Treasury Head Dubiously Claims Recovered “Fraud” Funds Could Fund the Military

Treasury Secretary Scott Bessent has announced several initiatives aimed at combating supposed benefit fraud as the Trump administration is seizing upon the issue to amp up its violent immigration crackdown in Democratic-led states and cities.

The news comes after right-wing Youtuber Nick Shirley went viral for videos accusing Somali people in Minneapolis of deceptively collecting Medicaid grants to run fraudulent daycares. While some child care fraud has been uncovered in places like Minnesota, investigators have debunked most of Shirley’s videos, noting that he visited many of the daycare centers during irregular hours before claiming they don’t offer the services advertised.

The videos have prompted the Trump administration to push additional unfounded assertions of fraud — more recently, federal officials claimed that fraud in Minnesota could be as high as $9 billion over the past seven years. But that estimate is not based on any substantiated evidence, and state officials say fraud has been found in the tens of millions — not billions — of dollars.

“We don’t have evidence in hand to suggest that we have $9 billion in fraud in these benefits over the last seven years,” Minnesota Medicaid Director John Connolly said.

Nevertheless, the Trump administration is using the exaggerated claims of fraud to justify escalating federal immigration agencies’ invasion of cities like Minneapolis.

In an interview with right-wing media last week, Bessent piled onto these claims, saying his department would restrict some immigrants from sending money to family members outside of the U.S. — a common practice for immigrants around the globe who are seeking to keep their loved ones out of poverty.

“For individuals who want to wire money out of the country, they’re gonna have to tick a box whether they are or are not on public assistance,” Bessent said in his interview. “Then we’re going to start pushing, over the coming days and weeks, that if you’re on public assistance, you cannot wire money out of the country.”

Bessent then baselessly claimed that immigrants sending money to family members abroad are likely committing fraud.

In the past month, Bessent has claimed that the Treasury Department will provide funds to whistleblowers of fraud, though he has not provided details on how much they will be paid, nor how individuals can provide such information to the department. He’s also made grandiose claims about what supposed funds recovered from fraud schemes could be used for, including suggesting that they could help fund Trump’s goal of increasing military spending up to $1.5 trillion.

The administration has peddled debunked or exaggerated claims of fraud to justify blocking tens of billions of dollars in federal expenditures, specifically to Democratic-controlled states — giving the appearance that the Trump White House is not so much interested in fraud, but rather wants to punish those states for political reasons. Indeed, President Donald Trump has been generous with his pardon powers for those convicted of white collar crimes, including granting clemency to an individual who defrauded $205 million in Medicare funds earlier this year.

Beyond Bessent, Vice President JD Vance announced that a new assistant attorney general position within the Justice Department would soon be created, with broad authority to investigate “fraud” nationally.

The vice president did not detail how the position would function or the extent of its oversight.

“We’re looking into broad investigative authority, to a number of instances of wrongdoing that we’ve seen in Minneapolis,” Vance said.

The implication is that the investigation will focus on supposed wrongdoings by immigrants, a population that the vice president has long sought to scapegoat. During the 2024 presidential election, for instance, Vance furthered Trump’s racist lies about Haitian immigrants in Springfield, Ohio. Confronted with the fact that the story was completely bogus, Vance suggested he didn’t care about the validity of the claims so long as they furthered the Trump administration’s aims, stating in an interview he was fine with “hav[ing] to create stories” to do so.