Take a look at the actual 2019 OLA report McKenzie cites. This characterization is wrong in ways that matter.
The "50% fraud" claim? It comes from one investigator (Swanson) using what the OLA explicitly calls "a higher level view, a view that does not require the kind of proof needed in a criminal or administrative proceeding." His methodology? If kids are poorly supervised, "running from room to room while adult employees spend hours in hallways chatting".... he counts the entire payment as fraud. That's not "billing for phantom children" it's "I don't like how this daycare is run."
The OLA's actual finding: "We did not find evidence to substantiate the allegation that the level of CCAP fraud in Minnesota is $100 million annually." Proven fraud over several years was $5-6 million.
Terrorism? "We were unable to substantiate the allegation that individuals in Minnesota sent CCAP fraud money to a foreign country where a terrorist organization obtained and used the money." They checked with the U.S. Attorney's Office.. none of Minnesota's terrorism cases involved CCAP money.
McKenzie writes "beyond intellectually serious dispute" about claims the primary source he cites explicitly could not substantiate.
Meanwhile the president is posting videos of the Obamas as apes and calling Somalis "garbage", having federal prosecutors throwing out arbitrary $9 billion estimates in press conferences.
Look, this is a mostly reasonable, if slightly vague, article about investigating fraud and mechanisms by which you do so.
What it lacks is any concrete suggestion as to what should change, beyond some vague allusions that perhaps racial/ethnic profiling should make a comeback.
The real problem here though is that the entire article ignores the duty[1] the government owes its citizens.
It's "fine"[2] if stripe or visa or whoever flips a coin and if it's tails they decide this person isn't allowed to be a customer of their company. The company loses any profit they might have made and life goes on.
It's considerably more problematic when the government refuses to serve a citizen (or even worse, levies an accusation).
There's some famous quotes about how many innocent people are appropriate to harm in the pursuit of the guilty but I'll leave those up to the reader.
[1] duty feels like too weak of a word here. Obligation? Requirement? The only reason the government even exists is to benefit the citizens.
[2] it becomes rapidly less fine when the company essentially has a monopoly over a system requires to participate in modern life, but that's a different topic...
This article isn't vague at all. It references various sources, and uses precise language (if you can recognize it) to convey its message. Yes, innocent until proven guilty, but the fact that the government has "lesser" educated Fraud analysts, chooses to ask for reimbursement of overbilling, and many more nuanced topics talked about in the article is not vague.
It's very indirect. The message is "the government is soft on fraud, partially because of liberal values", but the author does everything possible to not actually say it.
So what is supposed to change based on that? Pay more for better fraud investigators? Accept a lower burden of proof like stripe et al do? What's the take away here?
If you want a TLDR; style take-away, the last paragraph is a good place to start:
>"Responsible actors in civil society have a mandate to aggressively detect and interdict fraud. If they do not, they cede the field to irresponsible demagogues. They will not be careful in their conclusions. They will not be gentle in their proposals. They will not carefully weigh consequences upon the innocent. But they will be telling a truth that the great and the good are not.
The public will believe them, because the public believes its lying eyes."
Is auditing state-subsidized service providers fascistic?
From this piece, it seems like the state auditor detected some fraud, but there was little follow-up from either the state or 'responsible journalists', so the sensationalists came in with a (predictably) extreme take, after which everyone started slinging mud. The sensationalism could have been forestalled by better auditing by the state, or journalism by large-scale media. I am not sure what part of this is fascist.
> [2] it becomes rapidly less fine when the company essentially has a monopoly over a system requires to participate in modern life, but that's a different topic...
That's the real thing here. Concentrated power is scary-- whether it's the federal government, Visa/Mastercard, Google, etc.
At least power concentrated under the control of a government might be held accountable to the people. With private, concentrated power: fat chance.
I've called the phenomenon of private corporations refusing service the "Maoists in the Risk Department" in the past.
The reason why risk departments all inevitably reinvent Maoism is because the only effective enforcement mechanism they have is to refuse service. Fraudsters are fundamentally illegible to businesses of this size. And as the article stated, recidivism rates in fraud are high enough that someone caught doing fraud should never be given the time of day ever again. So the easiest strategy is to pick some heuristics that catch recidivist fraudsters and keep them a jealously guarded secret.
This calculus falls apart for the government. If someone rips the government off, they can arrest them, compel the production of documents from every third party they've interacted with, and throw them in jail where they won't be able to rip anyone else off for decades. Obviously, if we gave the Risk Department Maoists these same permissions, we'd be living under tyranny.
Well, more tyranny than we already live under.
But at the same time, the fact that we have these legal powers makes Risk Maoism largely obsolete. We don't need to repeatedly reinvestigate the same people for the same crime "just in case".
Right now we have either some form of fine, and while this can be incredibly painful, usually is not, then we go straight to like multiyear prison sentences, with perhaps a few suspended sentences in between there.
I dunno, maybe a world where "you did a small bank fraud so now you have some kind of antifraud system attached to you" is genuinely worse than the one we live in now, but the idea of being able to target more specific aspects of someone rather than just prison/not prison seems interesting.
I guess we have stuff like "not allowed to use a computer for 5 years" (thanks hackers movie!), dunno how effective or practical that is.
On Shirely, and the reaction: there's a markedly different valence to a fraud 'investigation' seeking to arrest, try, convict, and imprison _fraudsters_ vs one seeking (through a thin veil) to mar an entire community and bring about their violent dispossession at the hands of unaccountable little green men. It would not be an unreasonable person that strongly supports the former and opposes the latter.
Patrick is too polite to mention it, but frauds work much better if the fraudsters are also fully integrated into the political machine of the people nominally investigating the fraud.
I don't think that's in evidence. Institutionalized and ideologically-driven apathy towards the fraud, sure, but that's not uncommon (see: the defense industry; the finance industry).
There was few social services at the time. It was a patronage system. Different rewards but buying votes all the same. My point is that patronage is a long storied American tradition so I don’t know why people are al shocked that such schemes are still ongoing. Republican and anti castro cubans is or was a similar patronage system.
> Responsible actors in civil society have a mandate to aggressively detect and interdict fraud. If they do not, they cede the field to irresponsible demagogues. They will not be careful in their conclusions. They will not be gentle in their proposals. They will not carefully weigh consequences upon the innocent. But they will be telling a truth that the great and the good are not.
Leaving this to the conclusion does the piece a disservice. One can quibble (and it would be good to here) the extent to which the government isn't pursuing the sorts of fraud discussed, but this as a thesis makes clearer the argument throughout for earlier and more aggressive pursuit.
> They will sometimes organize recruitment very openly, using the same channels you use for recruiting at any other time: open Facebook groups, Reddit threads, and similar. They will film TikTok videos flashing their ill-gotten gains, and explaining steps in order for how you, too, can get paid.
> As a fraud investigator, you are allowed and encouraged to read Facebook at work.
I tend to believe this, but it would be a lot more compelling with links to a case where Facebook/TikTok posts were useful evidence.
Is that contradictory? Seems like organized fraud would need a supply of random fools, and a viral trend, if you can manage one, isn’t a bad way to get that.
Organized fraud preys on disorganized fools, but this fraud didn't require or benefit from organization. You could just go do it on your own, and pocket the money until you got a visit from the cops.
According to OP, there is substantial evidence indicating about 50% of the daycares are scams. I've seen Nick Shirley's video, I don't think he demonstrated any concrete about any of the sites he visited (he's not a very good investigator), but if the 50% number is correct... well, the broken clock was probably right at least a couple of times that day.
The 2019 OLA report "Child Care Assistance Program: Assessment of Fraud Allegations" is what makes the claim that greater than 50% of reimbursements to child care providers under these specific programs were fraudulent. That estimate is broadly and bipartisanly considered to be directionally true.
> And I think journalism and civil society should do some genuine soul-searching on how we knew—knew—the state of that pond, but didn’t consider it particularly important or newsworthy until someone started fishing on camera.
In... the same section where he cites all of the evidence the government has put together against the fraudsters. What is the issue? That these investigations should have been more prominently featured in the mainstream news? Would that have helped or hurt investigations?
> Of course, as the New York Times very carefully wordsmithed recently:
>> Minnesota officials said in early January that the state conducted compliance checks at nine child-care centers after Mr. Shirley posted his video and found them “operating as expected,” although it had “ongoing investigations” at four of them. One of the centers, which Mr. Shirley singled out because it misspelled the word “Learning” on its sign, has since voluntarily closed.
> An inattentive reader might conclude from this paragraph that the Times disputes Shirley’s reporting.
The New York Times is literally quoting what the Minnesota officials said. What were they supposed to do, add on "but a kid on YouTube says differently"?
I don't think the serious response to Nick Shirley's "journalism" is that there was no fraud; rather, it's that he came into the situation with a thinly veiled agenda and fed his audience exactly what they wanted to hear. Did his video make it more or less likely that we'll be able to investigate and resolve the fraud situation in MN? I guess that depends on how serious you think the laughably corrupt Trump administration is, but the fact that they seized on this as an excuse to send in 3000 ICE agents is not exactly promising.
The report to the government about a more than 50% fraud rate was from six years ago. The Minnesota government was not serious about dealing with problem. Most businesses would not last that long with a 50% customer fraud rate.
Yes, there were some investigations and convictions, but nothing to on a scale that would deal with problem, nor any systematic change to a level paying huge amounts of money to scammers.
He cites the 50% number from Jay Swanson, a CCAP Investigations Unit manager, and then dismisses criticism of the number by saying the criticism requires an unreasonable standard (only criminal convictions).
But if you read the cited source of how Swanson came up with that number he said it wasn't just for over-billing (claiming more kids than the places actually had).
Instead, by his estimation, the employees working are not actually working because 'children are unsupervised, running from room to room while adult “employees” spend hours in hallways chatting with other adults' and so all of the funds to those providers are fraudulent. [1]
I think it's pretty easy to criticize the logic for that 50% fraud rate number without requiring criminal convictions.
5 years ago. And it looks like the state was actually taking pretty aggressive moves against the fraud including ongoing investigations and legislation to shut down the fraud. [1]
There was active prosecution ongoing literally right up until Shirly's video. That's taking the matter seriously.
The volume of prosecution that had occurred or was slated to occur was laughable compared to the amount of fraud known or reasonably believed to have occurred. When it is done at scale, prosecution is inefficient and much less effective than reforming processes so as to preempt fraud, which is not something that happened, as evidenced by the continuing fraud after the initial round of prosecution.
FTA:
> So-called “pay-and-chase”, where we put the burden on the government to disallow payments for violations retrospectively, has been enormously expensive and ineffective. Civil liability bounces off of exists-only-to-defraud LLC. Criminal prosecutions, among the most expensive kinds of intervention the government is capable of doing short of kinetic war, result in only a ~20% reduction in fraudulent behavior. Rearchitecting the process to require prior authorization resulted in an “immediate and permanent” 68% reduction. (I commend to you this research on Medicare fraud regarding dialysis transport. And yes, the team did some interesting work to distinguish fraudulent from legitimate usage of the program. Non-emergency transport for dialysis specifically had exploded in reimbursements—see Figure 1— not because American kidneys suddenly got worse but because fraudsters adversarially targeted an identified weakness in Medicare.)
>There was active prosecution ongoing literally right up until Shirly's video
Oh yeah, the prosecution was sooo active that all the daycares listed as operational and receiving funding, had no kids in them, had blacked out or boarded up windows, misspelled signs, and if you went in to ask for enrollment 3 angry men would come out shouting at you. How many legit daycares have you seen that look like that?
Yes, because when I enroll a child in a daycare I start by wandering around the facilities with a camera man and then I demand to see the children. But sure is suspicious that this place has no kids in it when I visit it outside it's posted operation hours.
Nick did a day worth of shooting, didn't follow up, and didn't check basic things like hours of operation.
Right, everybody, especially the author of this piece, agrees that what Shirley did was bad and stupid. And also unnecessary, because we had documentary evidence from the Minnesota government itself showing the scale of the fraud here.
I doubt Patrick is the world's biggest Nick Shirley fan, but that's not really how it's conveyed in the article.
Shirley gets acknowledged to have "poor epistemic standards" (which is an almost euphemistic way of describing his approach) but Patrick goes on to say that "the journalism develops one bit of evidence...." and even appears to insinuate the NYT erred in reporting it in the context of the Minnesota government's response that the state's own compliance checks had found them open shortly afterwards but that some of them were under investigation.
There's an interesting point to be made that detailed, bipartisan evidence collected by suitably qualified officials that some daycenters were closed at times they were claimed to be open gets less attention than a YouTuber with an agenda rocking up at nurseries at what may or may not have been their opening times, but that's not how it's actually expressed. Rather it seems to be arguing for face value judgements of his video and against journalists that felt compelled to point out that whilst evidence of daycare fraud by Somalis in Minnesota definitely existed, Shirley's videos probably shouldn't be considered part of it.
> journalists that felt compelled to point out that whilst evidence of daycare fraud by Somalis in Minnesota definitely existed, Shirley's videos probably shouldn't be considered part of it.
Ah they pulled out the classic 'this wasn't "real" journalism so you should all ignore it'.
Of course so called journalists in the legacy mainstream media would be compelled to say that, because people like Nick SHirley are a threat to their jobs, so their only defence to save face on how this happened under their noses while they failed to report on it when investigating stuff like this is their literal job, is to slander those independants like Nick SHirley that exposed their incompetence and threaten their multi billion dollar media empire who wishes to have the monopoly on what's "the truth" or what's "journalism".
The usual counter argument to this is "but the real journalists already reported once about the fraud six years ago, what more do you want?". And my answer to that would be Oh, so the fraud was knowingly going on for six years already and the authorities still hadn't done anything about it?! After how many years is it just incompetence, complacency and accessory to crime?
The mainstream media was reporting on it 6 years ago. They reported on the 50 convictions too, which people whose information environment is YouTube tend to be unaware of.
Of all the things that threaten the future of mainstream reporting, YouTubers running round Ohio for an hour trying to find people who think Haitians are eatinng the local pets isn't one of them.
>I start by wandering around the facilities with a camera man
How does one wandering around with a camera affect the fact that the daycares had blacked out or boarded up windows, misspelled signs, and if you went in to ask for enrollment 3 angry men would come out shouting at you?
Do you even hear yourself? Are they Schrodinger's daycares? Do they become compliant the moment you stop filming them?
To put it mildly I don't think there's a consensus among Minnesota DFL-types who paid attention to this that the state at any point took the matter seriously in proportion to its severity. There's a lot of evidence that they did the opposite thing. I try to avoid openly identifying my partisan commitments (see this whole thread for why) but: this shit is what we Democrats constantly dunk on the GOP for doing, and we're not acquitting ourselves well here.
It's annoying that we're talking about this in these terms, because the article is about public services fraud, and it's mostly technical, and it's an interesting subject. We shouldn't have to debate Tim Walz to engage with it.
First: assuming your goal is to stop the fraud, does making deliberately inflammatory YouTube videos get you closer to that goal? I think the government's response clearly shows that they're more interested in the optics of "blue state full of scammer immigrants" than any actual resolution.
Second: I think one of the points Patrick misses is that fraud did indisputably occur, but that doesn't mean we need to treat Shirley as a neutral observer who simply cares about fiscal responsibility. (If I'm wrong, I eagerly away his next video on red state fraud.)
> What is the issue? That these investigations should have been more prominently featured in the mainstream news?
Important points throughout the article include: relatively little prosecution or enforcement occurred despite the awareness of rampant fraud; officials were naive to the common wisdom in fraud-prevention circles that people committing fraud in the past correlates strongly with the same individuals committing fraud in the future; "pay-and-chase" policies don't preempt funding flows to individuals suspected of fraud until it's established and feel the need to account for every fraudulent dollar instead of just blacklisting known bad actors the way that actual financial institutions do. FTA in particular, all emphasis FTA:
> For example, the primary evidence of a child attending a day-care was a handwritten sign-in sheet of minimal probative value. Prosecutors referred to them as “almost comical” and “useless.” They were routinely fraudulently filled out by a 17 year old “signing” for dozens of parents sequentially in the same handwriting, excepting cases where they were simply empty.
> To refute this “evidence”, the state forced itself to do weeks of stakeouts, producing hundreds of hours of video recording, after which it laboriously reconstructed exact counts of children seen entering/exiting a facility, compared it with the billing records, and then invoiced the centers only for proven overbilling.
> On general industry knowledge, if you are selected for examination in e.g. your credit card processing account, and your submission of evidence is “Oh yeah, those transactions are ones we customarily paperwork with a 17 year old committing obvious fraud”, your account will be swiftly closed. The financial institution doesn’t have to reach a conclusion about every dollar which has ever flowed through your account. What actual purpose would there be in shutting the barn door after the horse has left? The only interesting question is what you’ll be doing tomorrow, and clearly what you intend to do tomorrow is fraud.
Moving on,
> I don't think the serious response to Nick Shirley's "journalism" is that there was no fraud; rather, it's that he came into the situation with a thinly veiled agenda and fed his audience exactly what they wanted to hear.
My take is that there's no good reason to suspect that, except for holding an opposed thinly veiled agenda. And there is no serious dispute of the fact that billions of dollars of fraud occurred.
> Did his video make it more or less likely that we'll be able to investigate and resolve the fraud situation in MN?
It clearly made it more likely, as demonstrated by federal senate hearings that have extensively referenced the video (I've seen a segment where a senator literally had a prop photo of the "Quality Learing Center").
> the fact that they seized on this as an excuse to send in 3000 ICE agents is not exactly promising.
Your premise is that a YouTube video published Dec 26, 2025 somehow motivated a federal law enforcement action that commenced on Dec 4, 2025. Also, this claim conflates ICE with CBP. Also, per Wikipedia, out of thousands of arrests, only 23 have been of Somalis; and it's been abundantly clear in all the press functions that the targets have overwhelmingly been Hispanic — because they're overwhelmingly represented among illegal immigrants in the US, including in MN.
He was able to show all the evidence David had. The evidence had to be leaked out of the government of MN because it was silent whistleblowers that had been turned down after doing internal investigations. The government of MN may be complicit in all of this. It could be that they were trying to be anti-racist, which is why a lot of the fraud is specifically being performed by Somalians. But it can also be pay for vote fraud - where the leaders of the Somalian communities tell everyone who to vote for, and they are doing this because Walz (or some other people) are shielding the daycares from being shut down.
There is literally nothing wrong with stating this, we ought not be political about this. There may also be conservatives being elevated from Fraud as well, all of it should be routed.
At this point it definitely warrants deep investigations, not more articles trying to destroy a 23 year old that went viral.
Let's recall some of the things that have happened in the US over the past year:
1. Executive steals congressionally-appropriated money and uses them for their own purposes
2. Presidential pardons are for sale
3. Naked bribery of the executive via ballrooms, crypto, chunks of gold etc
4. Open market manipulation via tariff pump and dump schemes.
5. Endless personal profiteering, including things like using the military to steal foreign assets and deposit them in personal bank accounts.
Any of them far more interesting and immensely consequential to the future of the country, but of course, none of this is to be found on Patio's blog. People like him are an essential pillar of any authoritarian dictatorship - like the mainstream media's endless passive-voice sane-washing of Trumps statements and actions, his job is to use his existing credibility to give credence to lies, half truths and distractions. After reading his blog, readers can rest easy knowing that Trumps actions in MN are perfectly fine and justified.
None of this has anything to do with what he wrote, which is about the largest fraud scheme in the history of the midwest. Fraud is part of BAM's beat.
Choosing what to pay attention to says a lot about who you are and what you think. The largest fraud in the history of the country is unfolding in Washington, there is endless potential BAM content that would be of incredible consequence, but you won't find any mention of anything like that on his blog. Anybody that knows who patio is knows where his bread gets buttered understands very well why he would never say anything on those topics. As it stands this article is the only 'politica' post he has over the last year.
This is essentially gish-gallop or Banon's flood but for an audience that thinks itself sophisticated. As long as you are only focused on discussing the minutia of carefully selected technical materials, you won't have to focus on anything else going on.
No, to all of this. Talking about the largest fraud scheme in the history of the midwest without taking on all of Washington corruption doesn't make you a "gish gallop" or "Banon's flood" (whatever that is). In fact, it's kind of the opposite of a gish gallop. It's a single coherent argument. If you can rebut it, do so.
"the history of the midwest" seems awfully specific and easy to redefine as required.
That being said, it was a fairly interesting article about fraud in general, but if this is the only fraud article he wrote, why is that? There's lots of public frauds going on right now, is he going to write about them next?
Give it any reasonable definition you like, it'll probably still hold! This is extremely not the only fraud article he's written, and if you don't know that, why are you offering any opinions on his site at all? It's fine not to know anything about it! Just don't pretend otherwise and you'll be OK.
A critical part of media literacy is not just evaluating a piece of work at face value, but considering who wrote it, why they wrote it, why they wrote it now, what they didn't write etc. The article itself is actually not really interesting, but why this person wrote this article now is interesting.
Notably there's no smoking gun proof for any of the claims, and equivalent stuff on the other side is dismissed as whataboutism. Clinton Foundation? Never heard of that Pokémon.
Yeah, the fraud’s been around for a while and the Biden DoJ was investigating it. One of the guys got fingered trying to bribe a juror¹ but he stole half the bribe money.
The politicization of the issue means that Democratic Party aligned people continually flag any reference to the scam on HN though. If anyone else said that someone broke in and stole all the records from a daycare days after it was accused of fraud it would be considered a bald-faced lie but because of the political alignment (this is VP candidate Walz’s state) everyone is forced to pretend there’s no scam.
¹ Paradoxically the one honest juror who reported the bribe was removed from the case. No others reported any bribe which obviously must mean they received none.
Rather than stating, without data, that Democratic Party alignment led to flagging of the story here on HN, one can look at the numerous overt statements by some of the most active users. These users claim they spend significant time flagging all political stories not tied to computing or science.
The reason that "the left" is rolling eyes at the fuss being made over this fraud is:
1. The fraud is in fact being investigated, people are being charged and convicted. Despite this, rightwing media institutions are acting as if fraud is being ignored and maybe even covered up and encouraged because
2. This is just another example of the decades long project by those who have lots of money and don't want to see it go to takes to paint social programs as a money-pipe from good hardworking people to fraud and waste.
Great article, ties in neatly with observations among many that fraud, grifting, and devolution of the social contract has escalated greatly since 2020.
> To the extent that Bits about Money has an editorial line on that controversy, it is this: if you fish in a pond known to have 50% blue fish, and pull out nine fish, you will appear to be a savant-like catcher of blue fish, and people claiming that it is unlikely you have identified a blue fish will swiftly be made to look like fools. But the interesting bit of the observation is, almost entirely, the base rate of the pond. And I think journalism and civil society should do some genuine soul-searching on how we knew—knew—the state of that pond, but didn’t consider it particularly important or newsworthy until someone started fishing on camera.
Does Patrick want to address the fact that this happened during school break and that Nick Shirley didn't prove much of anything?
The entire story of what happened in Minnesota, as agreed on by basically everybody involved including significant chunks of the government of Minnesota, is that convictions are not a reasonable measure of accuracy here. The story is that they didn't pursue fraud prosecutions in proportion to their severity. Responding to that with "but there weren't convictions" is literally just begging the question.
It's very annoying that I feel like I have to say this but: I'm a committed Democrat, and I feel like my anti-Trump anti-racism bona fides, including on this site, are quite solid. The Minnesota thing happened. We can debate the scale, but it happened.
Yes, fraud is bad. I agreed before I read the article.
I've learned (from the article) that there was apparently some fraud in Minnesota, some of which was successfully prosecuted and, possibly, some that wasn't.
If pressed, I would say the take away from the article is that the fraud investigators should have been more willing to use race/ethnicity and accept a lower standard of evidence before taking action.
Did you read the actual report? The part about how a single investigator didn't like how some daycares were run, the level of supervision, and then used that to extrapolate a hypothetical invalidation of all payments to those facilities as "fraudulent"?
Democrats have rationalized much worse things than this, for example the ethnic cleansing (genocide) in Gaza. So with all due respect frankly I'm not at all assuaged by your caveat.
Take a look at the actual 2019 OLA report McKenzie cites. This characterization is wrong in ways that matter.
The "50% fraud" claim? It comes from one investigator (Swanson) using what the OLA explicitly calls "a higher level view, a view that does not require the kind of proof needed in a criminal or administrative proceeding." His methodology? If kids are poorly supervised, "running from room to room while adult employees spend hours in hallways chatting".... he counts the entire payment as fraud. That's not "billing for phantom children" it's "I don't like how this daycare is run."
The OLA's actual finding: "We did not find evidence to substantiate the allegation that the level of CCAP fraud in Minnesota is $100 million annually." Proven fraud over several years was $5-6 million.
Terrorism? "We were unable to substantiate the allegation that individuals in Minnesota sent CCAP fraud money to a foreign country where a terrorist organization obtained and used the money." They checked with the U.S. Attorney's Office.. none of Minnesota's terrorism cases involved CCAP money.
McKenzie writes "beyond intellectually serious dispute" about claims the primary source he cites explicitly could not substantiate.
Meanwhile the president is posting videos of the Obamas as apes and calling Somalis "garbage", having federal prosecutors throwing out arbitrary $9 billion estimates in press conferences.
See for yourself: https://www.auditor.leg.state.mn.us/sreview/ccap.pdf
Look, this is a mostly reasonable, if slightly vague, article about investigating fraud and mechanisms by which you do so.
What it lacks is any concrete suggestion as to what should change, beyond some vague allusions that perhaps racial/ethnic profiling should make a comeback.
The real problem here though is that the entire article ignores the duty[1] the government owes its citizens.
It's "fine"[2] if stripe or visa or whoever flips a coin and if it's tails they decide this person isn't allowed to be a customer of their company. The company loses any profit they might have made and life goes on.
It's considerably more problematic when the government refuses to serve a citizen (or even worse, levies an accusation).
There's some famous quotes about how many innocent people are appropriate to harm in the pursuit of the guilty but I'll leave those up to the reader.
[1] duty feels like too weak of a word here. Obligation? Requirement? The only reason the government even exists is to benefit the citizens.
[2] it becomes rapidly less fine when the company essentially has a monopoly over a system requires to participate in modern life, but that's a different topic...
This article isn't vague at all. It references various sources, and uses precise language (if you can recognize it) to convey its message. Yes, innocent until proven guilty, but the fact that the government has "lesser" educated Fraud analysts, chooses to ask for reimbursement of overbilling, and many more nuanced topics talked about in the article is not vague.
It's very indirect. The message is "the government is soft on fraud, partially because of liberal values", but the author does everything possible to not actually say it.
So what is supposed to change based on that? Pay more for better fraud investigators? Accept a lower burden of proof like stripe et al do? What's the take away here?
If you want a TLDR; style take-away, the last paragraph is a good place to start:
>"Responsible actors in civil society have a mandate to aggressively detect and interdict fraud. If they do not, they cede the field to irresponsible demagogues. They will not be careful in their conclusions. They will not be gentle in their proposals. They will not carefully weigh consequences upon the innocent. But they will be telling a truth that the great and the good are not.
The public will believe them, because the public believes its lying eyes."
Ahh, reminds me of the classic appeal.
"If you don't do <fascist thing> now, the real fascists will take over!"
Is auditing state-subsidized service providers fascistic?
From this piece, it seems like the state auditor detected some fraud, but there was little follow-up from either the state or 'responsible journalists', so the sensationalists came in with a (predictably) extreme take, after which everyone started slinging mud. The sensationalism could have been forestalled by better auditing by the state, or journalism by large-scale media. I am not sure what part of this is fascist.
> [2] it becomes rapidly less fine when the company essentially has a monopoly over a system requires to participate in modern life, but that's a different topic...
That's the real thing here. Concentrated power is scary-- whether it's the federal government, Visa/Mastercard, Google, etc.
At least power concentrated under the control of a government might be held accountable to the people. With private, concentrated power: fat chance.
I've called the phenomenon of private corporations refusing service the "Maoists in the Risk Department" in the past.
The reason why risk departments all inevitably reinvent Maoism is because the only effective enforcement mechanism they have is to refuse service. Fraudsters are fundamentally illegible to businesses of this size. And as the article stated, recidivism rates in fraud are high enough that someone caught doing fraud should never be given the time of day ever again. So the easiest strategy is to pick some heuristics that catch recidivist fraudsters and keep them a jealously guarded secret.
This calculus falls apart for the government. If someone rips the government off, they can arrest them, compel the production of documents from every third party they've interacted with, and throw them in jail where they won't be able to rip anyone else off for decades. Obviously, if we gave the Risk Department Maoists these same permissions, we'd be living under tyranny.
Well, more tyranny than we already live under.
But at the same time, the fact that we have these legal powers makes Risk Maoism largely obsolete. We don't need to repeatedly reinvestigate the same people for the same crime "just in case".
My take is that we lack granular punishments.
Right now we have either some form of fine, and while this can be incredibly painful, usually is not, then we go straight to like multiyear prison sentences, with perhaps a few suspended sentences in between there.
I dunno, maybe a world where "you did a small bank fraud so now you have some kind of antifraud system attached to you" is genuinely worse than the one we live in now, but the idea of being able to target more specific aspects of someone rather than just prison/not prison seems interesting.
I guess we have stuff like "not allowed to use a computer for 5 years" (thanks hackers movie!), dunno how effective or practical that is.
On Shirely, and the reaction: there's a markedly different valence to a fraud 'investigation' seeking to arrest, try, convict, and imprison _fraudsters_ vs one seeking (through a thin veil) to mar an entire community and bring about their violent dispossession at the hands of unaccountable little green men. It would not be an unreasonable person that strongly supports the former and opposes the latter.
Patrick is too polite to mention it, but frauds work much better if the fraudsters are also fully integrated into the political machine of the people nominally investigating the fraud.
I don't think that's in evidence. Institutionalized and ideologically-driven apathy towards the fraud, sure, but that's not uncommon (see: the defense industry; the finance industry).
Its hilarious how short human memory is. To me Minnesota just seems like a replay of Tammany Hall in NYC
Then I think you need to read more about Tammany Hall, because it was not simply a widespread pattern of fraud in social services.
There was few social services at the time. It was a patronage system. Different rewards but buying votes all the same. My point is that patronage is a long storied American tradition so I don’t know why people are al shocked that such schemes are still ongoing. Republican and anti castro cubans is or was a similar patronage system.
> Responsible actors in civil society have a mandate to aggressively detect and interdict fraud. If they do not, they cede the field to irresponsible demagogues. They will not be careful in their conclusions. They will not be gentle in their proposals. They will not carefully weigh consequences upon the innocent. But they will be telling a truth that the great and the good are not.
Leaving this to the conclusion does the piece a disservice. One can quibble (and it would be good to here) the extent to which the government isn't pursuing the sorts of fraud discussed, but this as a thesis makes clearer the argument throughout for earlier and more aggressive pursuit.
> They will sometimes organize recruitment very openly, using the same channels you use for recruiting at any other time: open Facebook groups, Reddit threads, and similar. They will film TikTok videos flashing their ill-gotten gains, and explaining steps in order for how you, too, can get paid.
> As a fraud investigator, you are allowed and encouraged to read Facebook at work.
I tend to believe this, but it would be a lot more compelling with links to a case where Facebook/TikTok posts were useful evidence.
There are tons of these out there.
In late 2024 there was the whole "Infinite money glitch" tiktok trend that was just check fraud.
https://www.bbc.com/news/articles/c4gzp7y8e7vo
Good example, though my impression was that was a quasi-viral TikTok trend that caught up random fools, not organized fraud?
Is that contradictory? Seems like organized fraud would need a supply of random fools, and a viral trend, if you can manage one, isn’t a bad way to get that.
Organized fraud preys on disorganized fools, but this fraud didn't require or benefit from organization. You could just go do it on your own, and pocket the money until you got a visit from the cops.
You need a central actor who is benefitting from all the fools
Yeah, I fail to see the organization.
Here's a rap video, the entirety of which bragging about fraud against the government:
https://www.youtube.com/watch?v=K0ck7hTsug8
"I just been swipin' for EDD
Go to the bank, get a stack at least
This ** here better than sellin' Ps
I made some racks that I couldn't believe
Ten cards, that's two-hunnid large"
(For context, "EDD" is California’s Employment Development Department.)
With Google I can find out that he was prosecuted after his video came out. I'll count it. https://abc7.com/post/nuke-bizzle-rapper-edd-fraud/12024561/
It's interesting to note that some states restrict the use of rap music lyrics as evidence:
https://legalclarity.org/using-rap-lyrics-as-evidence-in-cri...
All I remember hearing about this is how creepy and racist it was to look for kids at a black-owned daycare. It was a scam the whole time?
According to OP, there is substantial evidence indicating about 50% of the daycares are scams. I've seen Nick Shirley's video, I don't think he demonstrated any concrete about any of the sites he visited (he's not a very good investigator), but if the 50% number is correct... well, the broken clock was probably right at least a couple of times that day.
The 2019 OLA report "Child Care Assistance Program: Assessment of Fraud Allegations" is what makes the claim that greater than 50% of reimbursements to child care providers under these specific programs were fraudulent. That estimate is broadly and bipartisanly considered to be directionally true.
Under "In which we briefly return to Minnesota":
> And I think journalism and civil society should do some genuine soul-searching on how we knew—knew—the state of that pond, but didn’t consider it particularly important or newsworthy until someone started fishing on camera.
In... the same section where he cites all of the evidence the government has put together against the fraudsters. What is the issue? That these investigations should have been more prominently featured in the mainstream news? Would that have helped or hurt investigations?
> Of course, as the New York Times very carefully wordsmithed recently:
>> Minnesota officials said in early January that the state conducted compliance checks at nine child-care centers after Mr. Shirley posted his video and found them “operating as expected,” although it had “ongoing investigations” at four of them. One of the centers, which Mr. Shirley singled out because it misspelled the word “Learning” on its sign, has since voluntarily closed.
> An inattentive reader might conclude from this paragraph that the Times disputes Shirley’s reporting.
The New York Times is literally quoting what the Minnesota officials said. What were they supposed to do, add on "but a kid on YouTube says differently"?
I don't think the serious response to Nick Shirley's "journalism" is that there was no fraud; rather, it's that he came into the situation with a thinly veiled agenda and fed his audience exactly what they wanted to hear. Did his video make it more or less likely that we'll be able to investigate and resolve the fraud situation in MN? I guess that depends on how serious you think the laughably corrupt Trump administration is, but the fact that they seized on this as an excuse to send in 3000 ICE agents is not exactly promising.
The report to the government about a more than 50% fraud rate was from six years ago. The Minnesota government was not serious about dealing with problem. Most businesses would not last that long with a 50% customer fraud rate.
Yes, there were some investigations and convictions, but nothing to on a scale that would deal with problem, nor any systematic change to a level paying huge amounts of money to scammers.
He cites the 50% number from Jay Swanson, a CCAP Investigations Unit manager, and then dismisses criticism of the number by saying the criticism requires an unreasonable standard (only criminal convictions).
But if you read the cited source of how Swanson came up with that number he said it wasn't just for over-billing (claiming more kids than the places actually had).
Instead, by his estimation, the employees working are not actually working because 'children are unsupervised, running from room to room while adult “employees” spend hours in hallways chatting with other adults' and so all of the funds to those providers are fraudulent. [1]
I think it's pretty easy to criticize the logic for that 50% fraud rate number without requiring criminal convictions.
[1] https://www.auditor.leg.state.mn.us/sreview/ccap.pdf#page=16
This is a great argument. I wish this is what we were discussing rather than Nick Shirley and the partisan politics of the issue.
5 years ago. And it looks like the state was actually taking pretty aggressive moves against the fraud including ongoing investigations and legislation to shut down the fraud. [1]
There was active prosecution ongoing literally right up until Shirly's video. That's taking the matter seriously.
[1] https://en.wikipedia.org/wiki/2020s_Minnesota_fraud_scandals
The volume of prosecution that had occurred or was slated to occur was laughable compared to the amount of fraud known or reasonably believed to have occurred. When it is done at scale, prosecution is inefficient and much less effective than reforming processes so as to preempt fraud, which is not something that happened, as evidenced by the continuing fraud after the initial round of prosecution.
FTA:
> So-called “pay-and-chase”, where we put the burden on the government to disallow payments for violations retrospectively, has been enormously expensive and ineffective. Civil liability bounces off of exists-only-to-defraud LLC. Criminal prosecutions, among the most expensive kinds of intervention the government is capable of doing short of kinetic war, result in only a ~20% reduction in fraudulent behavior. Rearchitecting the process to require prior authorization resulted in an “immediate and permanent” 68% reduction. (I commend to you this research on Medicare fraud regarding dialysis transport. And yes, the team did some interesting work to distinguish fraudulent from legitimate usage of the program. Non-emergency transport for dialysis specifically had exploded in reimbursements—see Figure 1— not because American kidneys suddenly got worse but because fraudsters adversarially targeted an identified weakness in Medicare.)
>There was active prosecution ongoing literally right up until Shirly's video
Oh yeah, the prosecution was sooo active that all the daycares listed as operational and receiving funding, had no kids in them, had blacked out or boarded up windows, misspelled signs, and if you went in to ask for enrollment 3 angry men would come out shouting at you. How many legit daycares have you seen that look like that?
Yes, because when I enroll a child in a daycare I start by wandering around the facilities with a camera man and then I demand to see the children. But sure is suspicious that this place has no kids in it when I visit it outside it's posted operation hours.
Nick did a day worth of shooting, didn't follow up, and didn't check basic things like hours of operation.
Right, everybody, especially the author of this piece, agrees that what Shirley did was bad and stupid. And also unnecessary, because we had documentary evidence from the Minnesota government itself showing the scale of the fraud here.
I doubt Patrick is the world's biggest Nick Shirley fan, but that's not really how it's conveyed in the article.
Shirley gets acknowledged to have "poor epistemic standards" (which is an almost euphemistic way of describing his approach) but Patrick goes on to say that "the journalism develops one bit of evidence...." and even appears to insinuate the NYT erred in reporting it in the context of the Minnesota government's response that the state's own compliance checks had found them open shortly afterwards but that some of them were under investigation.
There's an interesting point to be made that detailed, bipartisan evidence collected by suitably qualified officials that some daycenters were closed at times they were claimed to be open gets less attention than a YouTuber with an agenda rocking up at nurseries at what may or may not have been their opening times, but that's not how it's actually expressed. Rather it seems to be arguing for face value judgements of his video and against journalists that felt compelled to point out that whilst evidence of daycare fraud by Somalis in Minnesota definitely existed, Shirley's videos probably shouldn't be considered part of it.
> journalists that felt compelled to point out that whilst evidence of daycare fraud by Somalis in Minnesota definitely existed, Shirley's videos probably shouldn't be considered part of it.
Ah they pulled out the classic 'this wasn't "real" journalism so you should all ignore it'.
Of course so called journalists in the legacy mainstream media would be compelled to say that, because people like Nick SHirley are a threat to their jobs, so their only defence to save face on how this happened under their noses while they failed to report on it when investigating stuff like this is their literal job, is to slander those independants like Nick SHirley that exposed their incompetence and threaten their multi billion dollar media empire who wishes to have the monopoly on what's "the truth" or what's "journalism".
The usual counter argument to this is "but the real journalists already reported once about the fraud six years ago, what more do you want?". And my answer to that would be Oh, so the fraud was knowingly going on for six years already and the authorities still hadn't done anything about it?! After how many years is it just incompetence, complacency and accessory to crime?
The mainstream media was reporting on it 6 years ago. They reported on the 50 convictions too, which people whose information environment is YouTube tend to be unaware of.
Of all the things that threaten the future of mainstream reporting, YouTubers running round Ohio for an hour trying to find people who think Haitians are eatinng the local pets isn't one of them.
>I start by wandering around the facilities with a camera man
How does one wandering around with a camera affect the fact that the daycares had blacked out or boarded up windows, misspelled signs, and if you went in to ask for enrollment 3 angry men would come out shouting at you?
Do you even hear yourself? Are they Schrodinger's daycares? Do they become compliant the moment you stop filming them?
Tell you what, go get a camera man and go visit your local daycare center. Post on youtube how they respond.
I predict that they would not spontaneously board up the windows and introduce spelling errors into their signage.
You're beating it around the bush going offtopic and ignoring my question:
How does having a camera impact the daycare having a misspelled sign and boarded up windows?
To put it mildly I don't think there's a consensus among Minnesota DFL-types who paid attention to this that the state at any point took the matter seriously in proportion to its severity. There's a lot of evidence that they did the opposite thing. I try to avoid openly identifying my partisan commitments (see this whole thread for why) but: this shit is what we Democrats constantly dunk on the GOP for doing, and we're not acquitting ourselves well here.
It's annoying that we're talking about this in these terms, because the article is about public services fraud, and it's mostly technical, and it's an interesting subject. We shouldn't have to debate Tim Walz to engage with it.
First: assuming your goal is to stop the fraud, does making deliberately inflammatory YouTube videos get you closer to that goal? I think the government's response clearly shows that they're more interested in the optics of "blue state full of scammer immigrants" than any actual resolution.
Second: I think one of the points Patrick misses is that fraud did indisputably occur, but that doesn't mean we need to treat Shirley as a neutral observer who simply cares about fiscal responsibility. (If I'm wrong, I eagerly away his next video on red state fraud.)
He's not treating Shirley as a neutral observer; he's lamenting Shirley's involvement, which has impeded efforts to clean this up.
> What is the issue? That these investigations should have been more prominently featured in the mainstream news?
Important points throughout the article include: relatively little prosecution or enforcement occurred despite the awareness of rampant fraud; officials were naive to the common wisdom in fraud-prevention circles that people committing fraud in the past correlates strongly with the same individuals committing fraud in the future; "pay-and-chase" policies don't preempt funding flows to individuals suspected of fraud until it's established and feel the need to account for every fraudulent dollar instead of just blacklisting known bad actors the way that actual financial institutions do. FTA in particular, all emphasis FTA:
> For example, the primary evidence of a child attending a day-care was a handwritten sign-in sheet of minimal probative value. Prosecutors referred to them as “almost comical” and “useless.” They were routinely fraudulently filled out by a 17 year old “signing” for dozens of parents sequentially in the same handwriting, excepting cases where they were simply empty.
> To refute this “evidence”, the state forced itself to do weeks of stakeouts, producing hundreds of hours of video recording, after which it laboriously reconstructed exact counts of children seen entering/exiting a facility, compared it with the billing records, and then invoiced the centers only for proven overbilling.
> On general industry knowledge, if you are selected for examination in e.g. your credit card processing account, and your submission of evidence is “Oh yeah, those transactions are ones we customarily paperwork with a 17 year old committing obvious fraud”, your account will be swiftly closed. The financial institution doesn’t have to reach a conclusion about every dollar which has ever flowed through your account. What actual purpose would there be in shutting the barn door after the horse has left? The only interesting question is what you’ll be doing tomorrow, and clearly what you intend to do tomorrow is fraud.
Moving on,
> I don't think the serious response to Nick Shirley's "journalism" is that there was no fraud; rather, it's that he came into the situation with a thinly veiled agenda and fed his audience exactly what they wanted to hear.
My take is that there's no good reason to suspect that, except for holding an opposed thinly veiled agenda. And there is no serious dispute of the fact that billions of dollars of fraud occurred.
> Did his video make it more or less likely that we'll be able to investigate and resolve the fraud situation in MN?
It clearly made it more likely, as demonstrated by federal senate hearings that have extensively referenced the video (I've seen a segment where a senator literally had a prop photo of the "Quality Learing Center").
> the fact that they seized on this as an excuse to send in 3000 ICE agents is not exactly promising.
Your premise is that a YouTube video published Dec 26, 2025 somehow motivated a federal law enforcement action that commenced on Dec 4, 2025. Also, this claim conflates ICE with CBP. Also, per Wikipedia, out of thousands of arrests, only 23 have been of Somalis; and it's been abundantly clear in all the press functions that the targets have overwhelmingly been Hispanic — because they're overwhelmingly represented among illegal immigrants in the US, including in MN.
He was able to show all the evidence David had. The evidence had to be leaked out of the government of MN because it was silent whistleblowers that had been turned down after doing internal investigations. The government of MN may be complicit in all of this. It could be that they were trying to be anti-racist, which is why a lot of the fraud is specifically being performed by Somalians. But it can also be pay for vote fraud - where the leaders of the Somalian communities tell everyone who to vote for, and they are doing this because Walz (or some other people) are shielding the daycares from being shut down.
There is literally nothing wrong with stating this, we ought not be political about this. There may also be conservatives being elevated from Fraud as well, all of it should be routed.
At this point it definitely warrants deep investigations, not more articles trying to destroy a 23 year old that went viral.
Let's recall some of the things that have happened in the US over the past year:
1. Executive steals congressionally-appropriated money and uses them for their own purposes
2. Presidential pardons are for sale
3. Naked bribery of the executive via ballrooms, crypto, chunks of gold etc
4. Open market manipulation via tariff pump and dump schemes.
5. Endless personal profiteering, including things like using the military to steal foreign assets and deposit them in personal bank accounts.
Any of them far more interesting and immensely consequential to the future of the country, but of course, none of this is to be found on Patio's blog. People like him are an essential pillar of any authoritarian dictatorship - like the mainstream media's endless passive-voice sane-washing of Trumps statements and actions, his job is to use his existing credibility to give credence to lies, half truths and distractions. After reading his blog, readers can rest easy knowing that Trumps actions in MN are perfectly fine and justified.
None of this has anything to do with what he wrote, which is about the largest fraud scheme in the history of the midwest. Fraud is part of BAM's beat.
Choosing what to pay attention to says a lot about who you are and what you think. The largest fraud in the history of the country is unfolding in Washington, there is endless potential BAM content that would be of incredible consequence, but you won't find any mention of anything like that on his blog. Anybody that knows who patio is knows where his bread gets buttered understands very well why he would never say anything on those topics. As it stands this article is the only 'politica' post he has over the last year.
This is essentially gish-gallop or Banon's flood but for an audience that thinks itself sophisticated. As long as you are only focused on discussing the minutia of carefully selected technical materials, you won't have to focus on anything else going on.
No, to all of this. Talking about the largest fraud scheme in the history of the midwest without taking on all of Washington corruption doesn't make you a "gish gallop" or "Banon's flood" (whatever that is). In fact, it's kind of the opposite of a gish gallop. It's a single coherent argument. If you can rebut it, do so.
"the history of the midwest" seems awfully specific and easy to redefine as required.
That being said, it was a fairly interesting article about fraud in general, but if this is the only fraud article he wrote, why is that? There's lots of public frauds going on right now, is he going to write about them next?
Give it any reasonable definition you like, it'll probably still hold! This is extremely not the only fraud article he's written, and if you don't know that, why are you offering any opinions on his site at all? It's fine not to know anything about it! Just don't pretend otherwise and you'll be OK.
https://en.wikipedia.org/wiki/Flood_the_zone
A critical part of media literacy is not just evaluating a piece of work at face value, but considering who wrote it, why they wrote it, why they wrote it now, what they didn't write etc. The article itself is actually not really interesting, but why this person wrote this article now is interesting.
Notably there's no smoking gun proof for any of the claims, and equivalent stuff on the other side is dismissed as whataboutism. Clinton Foundation? Never heard of that Pokémon.
Yeah, the fraud’s been around for a while and the Biden DoJ was investigating it. One of the guys got fingered trying to bribe a juror¹ but he stole half the bribe money.
The politicization of the issue means that Democratic Party aligned people continually flag any reference to the scam on HN though. If anyone else said that someone broke in and stole all the records from a daycare days after it was accused of fraud it would be considered a bald-faced lie but because of the political alignment (this is VP candidate Walz’s state) everyone is forced to pretend there’s no scam.
¹ Paradoxically the one honest juror who reported the bribe was removed from the case. No others reported any bribe which obviously must mean they received none.
Rather than stating, without data, that Democratic Party alignment led to flagging of the story here on HN, one can look at the numerous overt statements by some of the most active users. These users claim they spend significant time flagging all political stories not tied to computing or science.
These statements are trivially found using https://hn.algolia.com.
The reason that "the left" is rolling eyes at the fuss being made over this fraud is:
1. The fraud is in fact being investigated, people are being charged and convicted. Despite this, rightwing media institutions are acting as if fraud is being ignored and maybe even covered up and encouraged because
2. This is just another example of the decades long project by those who have lots of money and don't want to see it go to takes to paint social programs as a money-pipe from good hardworking people to fraud and waste.
Great article, ties in neatly with observations among many that fraud, grifting, and devolution of the social contract has escalated greatly since 2020.
> To the extent that Bits about Money has an editorial line on that controversy, it is this: if you fish in a pond known to have 50% blue fish, and pull out nine fish, you will appear to be a savant-like catcher of blue fish, and people claiming that it is unlikely you have identified a blue fish will swiftly be made to look like fools. But the interesting bit of the observation is, almost entirely, the base rate of the pond. And I think journalism and civil society should do some genuine soul-searching on how we knew—knew—the state of that pond, but didn’t consider it particularly important or newsworthy until someone started fishing on camera.
Does Patrick want to address the fact that this happened during school break and that Nick Shirley didn't prove much of anything?
No? He dunks on Shirley. His point is that professional investigators found and documented much worse things.
As if: https://news.ycombinator.com/item?id=46916838
What if this article is just the rationalist version of the Nick Shirley hit piece?
Except for the part where when asked for proof he laughed off the idea of using convictions as a measure of accuracy.
The entire story of what happened in Minnesota, as agreed on by basically everybody involved including significant chunks of the government of Minnesota, is that convictions are not a reasonable measure of accuracy here. The story is that they didn't pursue fraud prosecutions in proportion to their severity. Responding to that with "but there weren't convictions" is literally just begging the question.
It's very annoying that I feel like I have to say this but: I'm a committed Democrat, and I feel like my anti-Trump anti-racism bona fides, including on this site, are quite solid. The Minnesota thing happened. We can debate the scale, but it happened.
My ultimate take on the article is "so what?"
Yes, fraud is bad. I agreed before I read the article.
I've learned (from the article) that there was apparently some fraud in Minnesota, some of which was successfully prosecuted and, possibly, some that wasn't.
If pressed, I would say the take away from the article is that the fraud investigators should have been more willing to use race/ethnicity and accept a lower standard of evidence before taking action.
Is there something I'm missing?
That's what I'm getting from this article too. It's giving "Nick Shirley in the style of lots of extra words".
Did you read the actual report? The part about how a single investigator didn't like how some daycares were run, the level of supervision, and then used that to extrapolate a hypothetical invalidation of all payments to those facilities as "fraudulent"?
Democrats have rationalized much worse things than this, for example the ethnic cleansing (genocide) in Gaza. So with all due respect frankly I'm not at all assuaged by your caveat.