Republicans have made Minnesota central to their crusade against fraud in federal government programs. Now, both gubernatorial candidates are arguing they’re better equipped to right the ship.
The stakes are high for Minnesota’s federal programs: The White House is currently withholding close to $200 million in federal Medicaid payments over fraud concerns in Minnesota’s public health programs, and Trump has accused outgoing Gov. Tim Walz, a Democrat, of allowing the state to become a “hub of fraudulent money laundering activity.” The state’s large Somali population also faced an intense immigration crackdown operation last winter, with officials in part citing allegations of fraud in public programs.
Democratic Sen. Amy Klobuchar on Tuesday tried to make an early entry in the lane Republicans have dominated for the last year as voters turn to the general election. Her first general election TV ad promises “a top-to-bottom audit of state government” to rid the state of “the waste and the fraud and the abuse” — a phrase that’s typically been used by conservatives, including the Trump officials who have rescinded the state’s federal funding.
“She knows it’s a massive issue,” Amy Frederiksen, a Republican strategist and former state Senate majority leader, told NOTUS. Frederiksen says Democrats across the country haven’t been as vocal about combatting fraud, but “sometimes there’s just local issues that rise up that even obscure some of the national pressures.”
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Republican nominee Lisa Demuth — who has made fighting fraud a legislative priority during her time as state House speaker — says she’ll implement an updated anti-fraud plan during her first 90 days as governor. She also proposes firing all existing commissioners and replacing them with experts who are “committed to ending the culture of fraud,” restructuring state program eligibility requirements and establishing an independent state inspector general’s office.
Throughout her campaign, Demuth has tied Klobuchar to Walz, saying the senator’s tenure would be like a “Walz third term.” The governor dropped his bid for another term amid ongoing criticism for his administration’s handling of fraud in Minnesota’s state programs, and did not endorse Klobuchar in the primaries.
“By finally cleaning up the fraud and working with the federal government, I will be able to lift the federal freeze that’s been impacting the legitimate providers harmed by the failed leadership of Tim Walz and Amy Klobuchar,” Demuth said during a Tuesday news conference.
Demuth is likely to keep trying to tie her opponent to Walz, Frederiksen said — but the link might not resonate with voters because she “wasn’t overseeing programs and these departments” while serving the state in D.C.
As a senator, Klobuchar says she successfully pushed for more prosecutors to handle cases related to the Feeding Our Future scandal, in which a child-nutrition program submitted fraudulent records to secure more than $240 million in federal funds.
“While others were just talking about fraud — I took action,” she wrote in a Tuesday post on X.
Last December, conservative YouTuber Nick Shirley posted a viral video alleging sweeping fraud at daycare centers run by the Somali community in Minnesota, and the state saw a surge in federal law enforcement presence soon after. Demuth said Minnesota’s Republican caucus had worked directly with Shirley and agency whistleblowers “to get the information out to the public and to hold the Walz administration accountable.”
Fraud has since become an increasingly salient issue for state voters, with 81% of respondents saying they were “very” or “somewhat” concerned about the level of fraud in state social services programs in a June poll. The same poll showed 45% of likely voters trusted Republicans to combat fraud, while 38% picked Democrats.
While Klobuchar had maintained a close friendship with Walz for years — including introducing the then-vice presidential candidate at the 2024 DNC — she began to distance herself as the governor’s political profile soured. Throughout her gubernatorial campaign, Klobuchar has contrasted their records to defy Republicans’ attempts to tie her to Walz’s fraud troubles.
“You are right to be angry about the fraud. It is unacceptable and it must end. It should never have happened to begin with,” Klobuchar said at a May news conference announcing her anti-fraud plan.
As governor, Klobuchar says she’ll establish a state “Do Not Pay” database to automatically block entities convicted of fraud from accessing grants or contracts, conduct unannounced inspections of groups receiving funds and modernize state technology systems. She also supports creating an inspector general’s office to coordinate across agencies.
Frederiksen thinks speaking out against fraud is “a message that works dually” for both parties. Fighting fraud involves both Republicans’ desire to protect taxpayer money and Democrats’ priority of safeguarding federal assistance programs, she said.
“I just don’t understand why the Democrats haven’t been more vocal on it, and I think that Senator Klobuchar must feel the same because I think the message works on a lot of levels,” Frederiksen said. “It’s certainly not just a GOP message, or shouldn’t be, but it has been.”
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