Updated: 2:35 p.m.
Federal prosecutors in Minneapolis have charged another 10 people in connection with an alleged $250 million scheme to defraud government child nutrition programs.
Last fall, the U.S. Attorney's office charged 50 people allegedly tied to the nonprofit Feeding Our Future with using phony documents and shell companies to steal funds meant for children in need. So far six people have pleaded guilty.
The charges are spread across multiple indictments and criminal information documents, and include charges of conspiracy, wire fraud, money laundering, and bribery.
One of the new defendants — Lul Bashir Ali — operated a small storefront restaurant in Faribault. Authorities say Ali falsely claimed to have served 700,000 meals to children.
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Mohamed Ali Hussein, the founder of the nonprofit Somali American Faribault Education, allegedly claimed to have served 1.2 million meals over a 10 month period in 2021.
Prosecutors say the two received more than $5 million in federal money.
Ali and Hussein are charged by criminal information, indicating they’ve waived their right to a grand jury indictment and are expected to plead guilty.
Authorities say that Feeding Our Future and its founder Aimee Bock were at the center of this alleged scheme, and conspired with dozens of other people who had restaurants or other food service businesses. Bock, like most of the defendants, has pleaded not guilty to the charges, but six of the 60 defendants have entered guilty pleas in recent months.
Luger said previously that this is the nation’s largest COVID-19 fraud scheme. It involved two programs operated by the U.S. Department of Agriculture and managed at the state level by the Minnesota Department of Education.
The Summer Food Service Program and Child and Adult Care Food Program have been around for decades and typically run through schools and day care centers. But when schools were closed at the start of the pandemic, the USDA loosened the rules and allowed restaurants to participate. Prosecutors say the defendants took advantage of these new rules.
Luger said a third defendant, Kawsar Jama, 41, of Eagan, submitted $3.7 million in fake claims and spent at least part of the money on personal items.
“She wasn't buying food,” Luger said. “Ms. Jama used phony invoices that she got from others to make it appear as thought she was buying food for these 2,560 people.” He said she set up a meal site in Pelican Rapids — a town in northern Minnesota with a population of about 2,500.
Luger said investigators are continuing to seize assets allegedly purchased with stolen taxpayer money. He said Monday that the value of seized assets has grown to nearly $67 million, up from $50 million when the first group of defendants was charged.
Assets under government control include bank accounts, real estate and $4 million worth of vehicles. The U.S. attorney said the total cost to taxpayers of the alleged fraud is “up from” the initial $250 million estimate, but he said investigators are still working to determine an exact figure.