Trump admin takes first steps after Nick Shirley's Minnesota Daycare fraud reveal; visas take hit

HHS has halted child-care payments to Minnesota due to allegations of funnelling taxpayer funds to fraudulent daycares.

Published on: Dec 31, 2025, 05:45:36 IST

By Shirin Gupta

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The U.S. Department of Health and Human Services has frozen all child-care payments to Minnesota amid serious allegations that the state “funnelled millions of taxpayer dollars to fraudulent daycares over the past decade."

Trump Administration takes first steps after Minnesota Daycare fraud investigation (AP Photo/Alex Brandon, File, Photographer: Hannah Beier/Bloomberg)

Jim O'Neill's statement

HHS Deputy Secretary Jim O'Neill announced the payment freeze on a X post, describing the move as an urgent measure to stop “the misuse of taxpayer funds” after Nick Shirley's video went viral.

O'Neill also said that he has “activated our defend the spend system for all ACF payments. Starting today, all ACF payments across America will require a justification and a receipt or photo evidence before we send money to a state.”

The administration also demanded a comprehensive audit of Minnesota's childcare system and pay attention to attendance records, licensing and inspections of centers cited in the video.

Additionally, O'Neill declared the launch of a dedicated fraud hotline and email address, childcare.gov. He added, “We have turned off the money spigot and we are finding the fraud.”

GOP calls for deportation and citizenship revocation

Tom Emmer, the GOP House Majority Whip, has demanded that Somalis connected to the quickly developing billion-dollar fraud scandal in Minnesota be denaturalized and deported.

“I have three words regarding Somalis who have committed fraud against American taxpayers: Send them home," he said.

The FBI and the Department of Homeland Security both claim to be stepping up their efforts to look into claims of massive fraud that have brought the state of Minnesota, home to the biggest Somali population in the US, to the attention of the country.

According to Attorney General Pam Bondi, 85 of the 98 people who have been charged thus far in relation to the fraud are Somali.

ABOUT THE AUTHOR
Shirin Gupta
Shirin Gupta is a content producer with the Hindustan Times. She covers everything between politics, entertainment and sports at the US desk. Shirin got interested in political journalism during her time as a web editor at her college newspaper NCC News in Syracuse when she first started seeing the effects of national politics in life of her fellow colleagues. Shirin has worked on a wide range of fast-moving and developing stories locally when she was at NCC editing accessible reports for the audience. Her current role requires her to track real-time updates, verify information and present balanced coverage across diverse beats. Covering US politics from an international newsroom perspective has further deepened her understanding of how domestic decisions can have far-reaching global consequences. With a keen interest in international affairs, Shirin continues to build her expertise in geopolitics, policy shifts, and cross-border developments. She aims to learn and evolve her reporting in matters of geopolitics and international issues. Outside the newsroom Shirin writes about books and music for her personal blog. She is an avid consumer of pop culture and reveres literature.Read More

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