Somali Scam: Deserted Daycares Rake In Millions

Minnesota’s Child Care Assistance Program (CCAP), a taxpayer-funded initiative intended to subsidize daycare for low-income families, has once again come under intense scrutiny amid allegations of widespread fraud involving “ghost” centers—facilities that claim to serve dozens or hundreds of children but show no visible signs of activity. The latest chapter in this long-running saga exploded into the public eye on December 26, 2025, when independent journalist Nick Shirley released a 42-minute video documenting visits to multiple Minneapolis facilities, many Somali-owned, that appeared completely deserted despite receiving millions in public funds.

Shirley, a 23-year-old content creator known for street-level investigative reporting, accompanied by a researcher identified as David, confronted staff at these sites and reviewed public records showing massive CCAP disbursements. The video quickly went viral, amassing tens of millions of views and drawing sharp reactions from Republican lawmakers, including House Majority Whip Tom Emmer (R-MN), who directly challenged Gov. Tim Walz (D) for explanations.

The Centerpiece: Quality “Learing” Center – A Symbol of Alleged Abuse

The most prominent example in Shirley’s investigation is the Quality Learning Center (sign prominently misspelled as “Quality Learing Center”) on Nicollet Avenue in south Minneapolis. Licensed for up to 99-102 children, the building features blacked-out windows, an empty parking lot, and no audible or visual evidence of childcare activity during midday visits.

When Shirley and his companion knocked and attempted to inquire about enrolling a child, a woman inside repeatedly shouted, “Don’t open up. It’s ICE!” and “Go away. Shame on you!” before slamming the door. Public records, as presented in the video and corroborated by reports from Fox News and KSTP, indicate the center received $1.9 million in CCAP funds in fiscal year 2025 alone, with totals approaching $4 million to $7.8 million since 2019.

Despite this, the Minnesota Department of Human Services (DHS) has documented 95 violations at the facility between 2019 and 2023, including inaccessible hazardous items, missing enrollment records for multiple children (e.g., no documentation for 16 kids), and inadequate supervision. The center’s license remains active through 2026, and payments have continued.

A longtime neighbor interviewed by Shirley, who has lived adjacent to the building since 2017, stated unequivocally: “I’ve never seen a single child there. None! Not at all… They’re stealing the money!”

Shirley claimed his one-day review of records uncovered over $110 million in payments to similar suspicious centers, many sharing patterns of high-capacity licenses, Somali ownership, and apparent inactivity.

Historical Context: A Scandal Decades in the Making

Allegations of CCAP fraud in Minnesota’s Somali community date back to at least the mid-2010s. A 2018 Fox 9 investigation alleged up to $100 million in potential losses, including claims of funds being transported overseas in suitcases. A subsequent 2019 report by the Office of the Legislative Auditor confirmed significant oversight gaps, overbilling, and lax record-keeping but could not substantiate the full $100 million figure or direct terrorism financing links at that time.

Prosecutions have been sporadic: Several providers faced charges for inflating attendance, paying kickbacks to parents for “recruiting” children, or operating shell companies. Patterns often involve billing for phantom children, falsified records, and international wire transfers, frequently to Kenya or Somalia.

By 2025, the issue has intertwined with broader social services fraud probes. Federal prosecutors, including First Assistant U.S. Attorney Joseph Thompson, have described investigations into 14 state programs, estimating total losses since 2018 could exceed $1 billion—potentially half of the $18 billion in federal funds allocated. Of 92 defendants charged across related schemes (including child nutrition and autism services), the vast majority are Somali-American.

Related scandals include the Feeding Our Future case (separate from CCAP but involving similar networks), where dozens were indicted for diverting hundreds of millions from child meal programs, with some funds allegedly reaching terror groups like Al-Shabaab.

Political Reactions and Broader Implications

The Shirley video prompted immediate backlash. Rep. Tom Emmer posted a clip, stating: “4 million dollars of hard-earned tax dollars going to an education center that can’t even spell learning correctly. Care to explain this one, Tim Walz?” Vice President JD Vance praised Shirley for delivering “far more useful journalism than 2024 Pulitzer winners.”

Critics, primarily Republicans, accuse the Walz administration of lax enforcement, citing fears of racism accusations as a barrier to aggressive oversight in the Somali-heavy Twin Cities diaspora (over 80,000 residents). President Trump has labeled Minnesota a “hub of fraudulent money laundering” and terminated Temporary Protected Status for Somalis.

Gov. Walz has responded by appointing a “fraud czar,” pausing payments to high-risk providers, and signing 2025 bipartisan reforms for enhanced data-sharing and stricter licensing. He has expressed fury over the fraud, arguing it erodes public trust, while cautioning against stigmatizing the entire Somali community.

DHS reports 62 active investigations into CCAP providers as of early 2025. Federal agencies, including HHS and Treasury, continue probes.

Community leaders emphasize that fraud involves individuals, not the diaspora as a whole, and warn against broad-brush accusations fueling division.

Patterns of Fraud and Systemic Vulnerabilities

Common tactics alleged in CCAP cases:

• Recruitment kickbacks to parents.

  
  

• Inflated or fabricated attendance records.

  
  

• Recruitment kickbacks to parents.

  
  

• Shell entities in shared buildings (e.g., one site housing 14-22 dubious “healthcare” or daycare companies).

  
  

• Overseas transfers for luxury assets.

Critics point to “trust-based” oversight—minimal site visits or verification—as enabling abuse. Reforms aim to mandate more rigorous checks, but Shirley’s footage suggests persistent gaps.

As federal and state probes deepen into 2026, the scandal underscores tensions over immigration, welfare integrity, and community relations in one of America’s most diverse states. With estimates of statewide fraud topping billions, the financial toll on taxpayers—and diversion from legitimate needy families—continues to mount.

Compiled from public records, DHS data, federal prosecutor statements, Nick Shirley’s video and posts, reports from Fox News, KSTP, Star Tribune, Breitbart, Gateway Pundit, and other outlets as of December 28, 2025.