A major state audit released this week affirms concerns of fraud in Minnesota, specifically in the Department of Human Services’ (DHS) Behavioral Health Administration (BHA) grant program.
The report revealed that between July 1, 2022, and December 31, 2024, DHS provided more than $425 million in grants to 830 organizations, many of which were nongovernmental. Furthermore, the audit found “incomplete financial reconciliations for 63 of 71 grant agreements,” including a lack of or no documentation. Auditors also discovered that some documentation appeared to be created after the report, suggesting that files were generated retroactively to show compliance.
Republican State Sen. Mark Koran commented on the audit, stating: “BHA failed to verify that grantees were providing the services they were paid for, failed to put basic financial controls in place, and then created documentation after the fact to mislead auditors.”
He declared that Minnesotans deserve “integrity from state agencies,” calling the retroactive documentation “unacceptable.”
“The audit makes clear that DHS leadership has failed at every level,” Koran added. “Employees were not properly trained, oversight was ignored, and accountability was missing, from Governor Walz, to Temporary DHS Commissioner Gandhi, to BHA managers. DHS needs a full reset, starting with leadership, training, ethics, and oversight.”
Meanwhile, the Deputy Secretary of the Department of Health and Human Services (HHS), Jim O’Neill, announced that Somalia’s diplomat to the United Nations is connected to a company scrutinized by authorities over Medicaid fraud. The matter marks the latest detail in an ongoing investigation in Minnesota following journalist Nick Shirley’s video exposing questionable daycares in the state.
