WASHINGTON — December 8, 2025.
Minnesota House Speaker Lisa Demuth, now a leading Republican candidate for governor, blasted Rep. Ilhan Omar (D-MN) on Friday, saying the congresswoman’s recent explanations for how a sprawling welfare fraud scheme ballooned to nearly $1 billion in Minnesota are “not credible” and fail to acknowledge systemic failures under Democratic leadership.

Appearing on Newsmax’s Finnerty, Demuth said she “is not buying” Omar’s claim that the unprecedented fraud largely stemmed from pandemic-era programs created too quickly and without sufficient guardrails. Instead, she said responsibility rests squarely with Gov. Tim Walz and senior state officials who, she argued, allowed widespread abuse through lax oversight.

“In Minnesota, we have record fraud because of a lack of oversight and a lack of accountability,” Demuth said. “This starts with Gov. Walz and every commissioner under whose agency this fraud took place.”

Her remarks come as federal prosecutors continue expanding charges in what the Department of Justice has described as one of the largest COVID-era fraud operations in the United States, centered on the nonprofit Feeding Our Future and dozens of affiliated vendors who claimed to distribute meals to needy children — claims prosecutors say were fabricated.

The DOJ estimates at least $250 million was stolen through the meal-reimbursement program alone, with the broader web of pandemic-related fraud across Minnesota potentially reaching $1 billion.

Omar: Fraud Grew Because COVID Programs Were Rushed

Omar has repeatedly condemned the scheme as “reprehensible” and said everyone involved should face prosecution. But when pressed on CNN last week about why the fraud continued unchecked for years, she suggested the emergency COVID programs had been deployed too rapidly.

“When you have new programs designed to help people, you’re oftentimes relying on third parties to facilitate,” Omar said. “A lot of the COVID programs were set up so quickly that the guardrails did not get created.”

Omar has insisted she was among the first to call for federal investigations. She denies any wrongdoing, and no evidence has linked her directly to the fraud. Federal indictments released Wednesday, however, show that some individuals connected to the scheme had donated to Omar, Walz, and Attorney General Keith Ellison; all have said those donations were returned years ago.

Demuth: Walz Administration Failed at Every Level

Demuth rejected Omar’s reasoning, arguing that the systemic failures long predated the pandemic and were made worse by Democratic mismanagement.

“I am not buying what was said about why the fraud might have gone on so long,” Demuth told Newsmax. “Minnesota has been taken advantage of by fraudsters because of the lack of internal controls and accountability.”

She highlighted that not a single Walz-appointed commissioner has been fired, reassigned, or formally reprimanded over the scandal despite repeated warnings dating back to 2020.

“What we don’t know is how deep this actually goes,” Demuth said. “We’re waiting for those investigations, and we’re waiting for more information to come forward.”

Could Omar Be Connected? “I Don’t Know,” Demuth Says

When asked whether Omar herself was involved in any wrongdoing, Demuth was cautious:

“No, I don’t know that she is directly involved.”

But she emphasized that Democratic leadership created “an environment ripe for abuse,” arguing that Minnesota’s reputation for generous social programs made it a target for those seeking to exploit weaker oversight systems.

Republican lawmakers in Washington have seized on the scandal as evidence of endemic mismanagement under Walz and Democrats statewide, while Walz maintains the fraudsters should be prosecuted but warns the GOP is weaponizing the issue.

The Road Ahead

With federal agencies — including the DOJ, IRS, and Treasury Department — accelerating their probes, Minnesota’s welfare fraud scandal has become a national flashpoint and a central issue in the state’s 2026 gubernatorial race.

Demuth’s appearance signals Republicans will continue tying the scandal to Democratic leadership at every level, including Omar, even as investigations are ongoing and no direct links to elected officials have been established.

The fallout is far from over — and Minnesota’s political landscape is bracing for more bombshells as federal investigators dig deeper.