Empty Daycares Took Millions

Scam text overlaid on distorted 100 dollar bill

A viral video sparks federal investigations into alleged fraud at Somali-run day care centers, igniting debates over immigration and Medicaid fraud.

Story Snapshot

Allegations of fraud at Somali-run day care centers in Minneapolis have gone viral, prompting federal scrutiny.
YouTuber Nick Shirley’s video accused the centers of receiving millions in federal funds without providing services.
State inspections found no immediate evidence of fraud, while federal investigations continue.
Accusations have reignited debates about immigration and systemic flaws in Medicaid.

Allegations of Fraud at Somali Day Care Centers

In December 2025, YouTuber Nick Shirley released a video highlighting alleged fraud at Somali-operated day care centers in Minneapolis. The video claimed that these centers, despite appearing empty, had received up to $100 million in federal funds through Medicaid-linked initiatives. This video quickly gained traction among conservative audiences, leading to a surge of federal investigations and state audits. However, state inspections have not uncovered immediate evidence of fraud at these centers, which dispute the claims.

Federal authorities, led by DHS Secretary Kristi Noem and FBI Director Kash Patel, have intensified operations in Minnesota, targeting what they label as “rampant fraud.” The U.S. Attorney’s Office has charged 92 defendants, a majority of whom are Somali Americans, in related schemes. The video has reignited conservative narratives linking immigration to welfare fraud, although state officials emphasize the need for thorough audits rather than community blame.

Background and Ongoing Investigations

Minnesota has a significant Somali-American population, a legacy of U.S. refugee resettlement efforts. This community has faced scrutiny for fraud since 2015, with issues like preschool overbilling and the Feeding Our Future scandal, which allegedly stole $300 million in child nutrition funds. The recent convictions and investigations into housing stabilization and autism services fraud have set the stage for the current situation.

In response to the viral video, Minnesota has launched a comprehensive audit and fraud hotline, with results expected by late January 2026. State inspections have confirmed the presence of children at the centers and no signs of fraud in recent months. Despite these findings, the investigations continue, with federal agents conducting door-to-door searches and expanding their probes.

Political and Social Implications

This case has significant implications for Somali-American communities and the broader political landscape. Economically, the investigations aim to recover lost funds and address systemic waste in Medicaid. Socially, the situation fuels division and anti-immigrant sentiment, while politically, it challenges Governor Tim Walz’s administration and bolsters narratives favored by Trump allies.

Experts argue that the core issue lies in a “broken Medicaid bureaucracy,” with poor state incentives that allow fraud to flourish. This situation highlights the vulnerabilities within national Medicaid systems and may prompt federal policy reforms. The narrative has varying interpretations, with conservatives focusing on immigrant-linked fraud and others advocating for systemic change.