'A brazen scheme' in Minnesota: 47 charged with siphoning $250 million from COVID-19 child meal program

WASHINGTON – Federal authorities unveiled charges against 47 people accused of siphoning $250 million from a coronavirus pandemic relief program designed to provide meals for children.

Prosecutors on Tuesday described "a brazen scheme of staggering proportions" that exploited a federally funded program to serve needy children in Minnesota during the pandemic.

U.S. Attorney Andrew M. Luger, the chief federal prosecutor in Minnesota, said the suspects used a local nonprofit known as "Feeding Our Future" as cover to claim reimbursements for meals never provided, and allegedly used the federal money to buy luxury cars, houses, jewelry and resort property abroad.

"I commend the work of the skilled investigators and prosecutors who unraveled the lies, deception, and mountains of false documentation to bring this complex case to light," Luger said.

The fraud may have been even larger than is now known, he said.

“This $250 million is the floor,"  Luger said at a news conference. “Our investigation continues.”

U.S. Attorney General Merrick Garland described the federal action as the most extensive fraud case to emerge from the government's massive pandemic relief effort.

FBI Director Christopher Wray said the allegations represented "an egregious plot" led by suspects who "went to great lengths" to divert a quarter-billion dollars to enrich themselves.

More: Iowa businessman charged with fraud, failure to pay over $440,000 in employment taxes

The Minnesota nonprofit, according to court documents, redirected money provided by the Federal Child Nutrition Program, administered by the U.S. Department of Agriculture, to provide free meals to children in need.

Federal prosecutors said the operation allegedly was overseen by Aimee Bock, founder and executive director of the local nonprofit, whose federal aid disbursements dramatically increased from $3.4 million in 2019 to nearly $200 million in 2021.

The organization, according to court records, "fraudulently claimed to be serving meals to thousands of children a day within just days or weeks of being formed."

"The defendants created dozens of shell companies to enroll in the program as Federal Child Nutrition Program sites. The defendants also created shell companies to receive and launder the proceeds of their fraudulent scheme," prosecutors said.

One example described a small storefront restaurant in Willmar, in west-central Minnesota, that typically served only a few dozen people a day. Two defendants offered the owner $40,000 a month to use his restaurant, then billed the government for some 1.6 million meals through 11 months of 2021, according to one indictment. They listed the names of around 2,000 children — nearly half of the local school district's total enrollment — and only 33 names matched actual students, the indictment said.

Prosecutors accused the suspects of submitting false meal counts, fake food purchase invoices and fabricated attendance rosters, some of which were drawn from a website that produces lists of random names.

"Because the program only reimbursed for meals served to children, other defendants used a computer formula to insert random ages, between 7 and 17, into the age column of the rosters," officials said.

“These children were simply invented,” Luger said. He said the government had so far recovered $50 million in money and property and expects to recover more.

When the Minnesota Department of Education sought to verify the nonprofit's activities, Bock allegedly "gave false assurances" that the organization was monitoring its 250 sites across the state and was serving the meals as claimed.

"When MDE employees pressed Bock for clarification, Bock accused MDE of discrimination and unfairly scrutinizing Feeding Our Future’s sites," prosecutors asserted.

Bock's group, according to court documents, went as far as filing a lawsuit against the state when the Education Department began denying the group's applications for future feeding sites. Bock's group accused the state of discrimination in violation of Minnesota's Human Rights Act. That case has since been dismissed.

Bock’s attorney, Kenneth Udoibok, said the indictment “doesn’t indicate guilt or innocence.” He said he wouldn't comment further until seeing the indictment.

In interviews after law enforcement searched multiple sites in January, including Bock’s home and offices, Bock denied stealing money and said she never saw evidence of fraud.

The Associated Press contributed to this report. 

This article originally appeared on USA TODAY: 47 charged with siphoning $250M from COVID-19 child meal program