Tim Walz Let Fraudsters Steal $12 Million From Minnesota Students and Nobody Got Fired

June 18, 2026 Cat2, The Media
Alexander Lukatskiy via shutterstock

Tim Walz watched fraudsters loot $350 million meant to feed children and told investigators a judge made him keep the payments going.

That same fraud culture just surfaced in Minnesota's colleges.

Seven thousand seven hundred ghost students pocketed $12.5 million in financial aid and vanished before anyone noticed.

7,700 Fake Students Filled Classrooms Meant for Real Kids

The scam is exactly what it sounds like.

Criminals steal an identity, use it to enroll in a community college, apply for federal financial aid, collect the check, and are gone before the school knows what happened.

In one online class at a Minnesota college, a professor opened registration expecting students – and within two minutes, all 50 spots were gone.

Forty-eight of those students were fake.

Jennifer Kerber, a fraud expert at Socure who investigated the scheme, put it plainly: "The student never existed, but the money is real."

Across 33 Minnesota state college campuses, investigators have identified more than 7,700 suspected ghost students.

That financial aid was supposed to help low-income Minnesotans get an education.

Instead it funded a fraud operation that shut real students out of classes they needed.

McMahon Warned Walz in December and He Did Nothing

This is not a new problem.

Last December, Education Secretary Linda McMahon sent a letter directly to Tim Walz warning him about the crisis.

She told him the scheme had already cost taxpayers over $12 million and that his state had been handed $3 million specifically to verify student identities and shut the fraud down.

That money was allocated months ago.

The fraud is still running.

House Republicans had to pass the No Aid for Ghost Students Act – federal legislation requiring the Department of Education to run every FAFSA application through an identity fraud detection system – because states like Minnesota refused to handle it themselves.

The bill passed 249-172 on June 10.

Thirty-six Democrats crossed over to vote yes.

That is how obvious this problem is – even Democrats could not defend it.

This Is What a $9 Billion Fraud Culture Looks Like

The ghost student scam is not an isolated incident in Minnesota.

It is one more branch of a fraud operation that the Minnesota House Fraud Prevention Committee just described in an 84-page final report as "massive and unprecedented."

Federal prosecutors estimate that serial fraudsters stole up to $9 billion in Medicaid funds and $300 million in federal child nutrition money under Walz's watch.

The committee found that Walz's administration did not just fail to stop the fraud – it actively retaliated against state employees who tried to blow the whistle.

Minnesota state Rep. Walter Hudson testified to the House Oversight Committee that fraud had stopped being a criminal exception in Minnesota and had become a business model.

Walz blamed the fraudsters.

He blamed a court order for continuing payments to Feeding Our Future – the fraudulent food program at the center of the scandal.

The presiding judge publicly clarified he never issued that order.

Walz made up the excuse.

The ghost student scandal is what happens when a governor builds a culture where fraud is tolerated, whistleblowers get fired, and the money keeps flowing until somebody outside the state forces it to stop.

Trump's Education Department stopped over $1 billion in fraudulent student aid in its first year.

Walz couldn't stop $12.5 million in his own backyard.

He was one election away from the vice presidency.

Think about that.

Sources:

  • Julia Cassidy, "Minnesota's Latest Fraud Scandal: 7,700 Ghost Students, $12.5 Million Gone," Townhall, June 15, 2026.
  • Congressman Tom Emmer, "Emmer, House Republicans Pass Ghost Student Anti-Fraud Bill," Emmer.house.gov, June 10, 2026.
  • House Committee on Oversight and Government Reform, "Oversight Committee Releases Bombshell Report Exposing Rampant Fraud Plaguing Minnesota's Taxpayer-Funded Social Programs," Oversight.house.gov, June 2026.
  • Fox News, "Final Walz Fraud Report Rips Culture of Tolerance as Minnesota Taxpayers Face Billions in Alleged Losses," FoxNews.com, May 2026.
  • Fox Baltimore, "Minnesota Lawmakers Accuse Walz of Allowing Culture of Fraud to Flourish," FoxBaltimore.com, January 7, 2026.
  • Deseret News, "U.S. House Passes Utah Republican's Bill to Crack Down on Ghost Students Stealing Financial Aid," DeseretNews.com, June 11, 2026.