Somali Fraud: Three Key Takeaways From Tuesday’s Senate Hearing

Authored by Janice Hisle via The Epoch Times (emphasis ours),

The magnitude of Minnesota’s Somali welfare-fraud problem has only begun to surface – and it is tied to other fraud in ways that many Americans do not realize, according to statements made during a Feb. 10 Senate hearing in Washington.

A subcommittee focused on immigration and border security held a two-hour hearing titled, “Somali Fraud in Minnesota—The Tip of the Iceberg.” Both houses of Congress are exploring the problem and its possible remedies.

Two witnesses who testified are former State Department employees who worked abroad as foreign service officers. Both men reported seeing weaknesses in America’s systems for verifying backgrounds and identities of foreigners who apply for U.S. immigration benefits.

Committee chair Sen. John Cornyn (R-Texas), announced he is preparing legislation to stop fraudsters from sending stolen U.S. taxpayer dollars overseas with no meaningful scrutiny.

The committee’s ranking member, Sen. Alex Padilla (D-Calif.) said, “No one is here to defend fraud.” But he accused Senate Republicans of “choosing to point to a few isolated incidents and using them to cast suspicion on entire communities.”

1. The ‘Tip of the Iceberg’

Prosecutors estimated that fraudsters bilked $9 billion or more from 14 of the state’s Medicaid programs since 2018—and “credible reports” indicate some Minnesota officials knew about fraud dating to 2011 yet allowed it to persist, Cornyn said.

The Justice Department has charged 98 defendants, 85 of whom are of Somali descent, in Minnesota fraud cases; 64 have been convicted. Prosecutors have issued more than 1,750 subpoenas, executed more than 130 search warrants and conducted more than 1,000 witness interviews, he said.

Despite those large numbers, Cornyn said, “This recent episode, unfortunately, appears to be just the tip of the iceberg.”

The depth of Minnesota fraud is still being uncovered—and more schemes are now coming to light in states such as California.

Sen. Amy Klobuchar (D-Minn.) said she has previously asked for more resources for the U.S. Attorney’s Office in Minnesota, which has brought the federal fraud charges.

Recently, 14 assistant U.S. attorneys left that office, Klobuchar said, citing news accounts indicating those prosecutors resigned over a controversy related to investigating the death of 37-year-old Renee Good, who was fatally shot by an Immigration and Customs Enforcement agent on Jan. 7.

“If we’re going to go after fraud, losing that talent is a huge problem,” she said.

Nationally, the Government Accountability Office estimates that between $233 billion and $521 billion are lost each year to “fraud and improper payments of federal benefits and other public funds,” Cornyn noted, repeating the numbers twice for emphasis.

Besides inflicting financial damage, fraud “directly affects the safety and security of Americans,” Cornyn said, adding that “much of the fraud is committed by aliens—many of them criminal aliens—and we don’t know what they’re doing with those stolen funds.”

Across America, illegal immigrants reap $8 billion in Medicaid fraud and $3 billion in earned-income tax credits per year, according to 2023 estimates from the Federation for American Immigration Reform (FAIR), Cornyn said.

2. Illegal Immigration Tied to Less-Obvious Fraud

Matt O’Brien, a former immigration judge who serves as FAIR’s deputy executive director, testified that many Americans do not realize that “immigration-related fraud represents a large and largely unacknowledged share” of the nation’s fraud losses.

That type of fraud includes “crimes committed to maintain life in the United States when someone lacks lawful status,” he said. Examples include identity theft, false U.S. citizenship claims, Social Security fraud, and tax fraud.

Migrants, facing pressure to succeed, “recognize opportunities created by weak oversight,” O’Brien said.

They also “may rationalize fraudulent conduct based on ideological narratives common in their home countries.”

“The result is widespread, repeated fraud that touches nearly every part of our government systems,” he said.

Yet data about immigration-related fraud is “remarkably scarce,” O’Brien said, noting the best figures are probably two decades old.

In addition, there is no “coordinated federal strategy” for detecting and prosecuting immigration fraud. Those responsibilities are “scattered across” state agencies and at least seven federal agencies.

Simon Hankinson, a senior research fellow who focuses on immigration issues for The Heritage Foundation, testified that in his former work as a foreign service officer, he was “lied to many times a day about every aspect of applicants’ cases.”

A U.S. consulate officer who interviews applicants serves as “the first line of vetting;” the next step involves checking U.S. databases for records about the person. But, he said, if the applicant comes from a nation that lacks accurate records or is unwilling to share the data, the records check is useless.

“Typically, the more corrupt and poor a country is, the more visa fraud,” he said, adding, “Somalia is as poor and corrupt as countries get.”

His former duties included supervising consular operations in Somalia. There, he routinely saw fraudulent marriage claims and unauthorized letters of support from the Somali government, among other falsifications.

Crime and corruption “seem to follow immigrant populations into host countries, at least in the first generation,” Hankinson said.

3. Low-Tech and High-Tech Solutions

Another former foreign service officer, Phillip Linderman, a board member of the Center for Immigration Studies, said it is a “supreme challenge” for consular officers to properly vet documents. And, he said, “there were always powerful voices in Washington constantly insisting that all visas be issued—and fast.”

A simple policy change could be effective, he said. “U.S. policy should curtail visa services in those countries that tolerate or are complicit in high levels of fraud,” Linderman said.

The State Department already tracks which countries have high visa fraud rates. But officials in that agency keep those records to themselves and “do almost nothing with them,” he said. “This is a big mistake.’

He urged the State Department to use that information in diplomatic relations with those countries.

Linderman also encouraged agencies to “apply the growing power of artificial intelligence and to look at fraud patterns in all immigration benefits—from visas all the way through to naturalization.”

In general, immigration benefits should be denied for people “whose identities we cannot verify and whose documents are unreliable and whose criminal records cannot be checked adequately,” he said.

Cornyn suggested both high-tech and low-tech measures.

“We can invest in fraud prevention and detection mechanisms … [and] require agencies to require biometric identification,” Cornyn said, before any applicant receives government money or benefits.

“Furthermore, we can require automated and recurrent identity verification, random audits and in-person identity verification” for programs that receive public funds, he said.

As a low-tech measure, Cornyn said he will propose the “Stop Somali Cash Fraud Act,” which addresses a problem that Homeland Security highlighted recently.

During the past two years, $700 million in cash—packed in suitcases—“has been flown out of the Minneapolis airport,” Cornyn said, noting many of those funds were “tied to Somali couriers.” Homeland Security officials said that practice has occurred for nearly a decade, Cornyn said.

That money “could be used to fund Somali terrorist organizations like al-Shabaab,” Cornyn said. The Treasury Department began investigating that possibility in December.

Under Cornyn’s proposal, noncitizens would be required to  disclose the source of large sums of cash they intend to transport overseas. They also would need to give additional background details 72 hours prior to scheduled air travel, which would give officials time to investigate.

David Bier, director of immigration studies at the Cato Institute and a former policy adviser for a Republican congressman, agreed with Democrats who said Somalis and other immigrants were being unfairly characterized.

After leaving “terrible conditions,” many immigrants start businesses and otherwise contribute to society, he said.

Bier proposed a sweeping change: “Congress should end the broken welfare systems—namely the oversight-free aid to states that led to all the fraud in Minnesota.”