Whoever coined the phrase “crime doesn’t pay” may want to steer clear of Minnesota, where some of the accused — and even convicted — in a $250 million fraud case still own real estate allegedly purchased with the stolen cash.
The fraud centers around Feeding Our Future, a non-profit that, according to the Justice Department, “opened more than 250 Federal Child Nutrition Program sites throughout the state of Minnesota.” (1) The group then collected hundreds of millions in taxpayer dollars during the COVID-19 pandemic as they “fraudulently claimed to be serving meals to thousands of children a day.”
Authorities called the $250 million case “a brazen scheme of staggering proportions” that marks “the largest pandemic relief fraud scheme charged to date.” (2)
It’s also one of several fraud operations in the state that law enforcement says stole more than a combined billion dollars in taxpayer funds.
But despite some of the perpetrators in the Feeding Our Future fraud being indicted and even convicted, a local news investigation discovered that the Minnesota real estate authorities say they bought with the scammed funds hasn’t been seized.
And that’s led some to question why they still have ownership over the homes, and when the government will get that money back.
Still benefiting from the fruits of fraud
The investigation into the Feeding Our Future accused and their real estate, conducted by Minnesota’s KSTP 5 Eyewitness News, focussed on three specific individuals. (3)
Sharon Ross, who directed a non-profit in St. Paul that worked with Feeding Our Future, was convicted and sentenced to 43 months in jail earlier this year after pleading guilty to wire fraud. (4) The KSTP investigation found that her husband is still listed as the owner of the house that authorities say she bought with money related to the scam. They added that “Federal prosecutors have not said specifically why the property has not been seized or when that might happen.”
They also pointed to a house still owned by Salim Said, despite his March conviction of various counts of wire fraud, bribery and money laundering in connection to Feeding Our Future. (1) The investigation said that Said “used fraud money to place a $952,000 down payment on the house in 2021” and that he and his wife are still listed as the home owners.
The third individual, Abdikerm Eidleh, also faces multiple wire fraud, bribery and money laundering charges after authorities say he “solicited and received bribes and kickbacks from individuals and sites under the sponsorship of Feeding Our Future” and “also created his own fraudulent sites.” (2) But the KSTP investigation says that, while his home “is identified in court records as subject to forfeiture,” and Eidleh himself “fled the country before he was named in the first wave of indictments,” his ex-wife and family still live there.
KSTP spoke with Mark Osler, a former Minnesota Assistant U.S. Attorney, who noted that the forfeiture process in such cases can be complicated and delayed by the legal process.
In Ross’ case, he said that taking back the real estate purchased with fraud gains “does need to be a priority” while, for Eidleh, he’s “sure” authorities are considering “go[ing] directly after the property” rather than extraditing the accused himself. And as for Said, the KSTP story noted that prosecutors said they can’t seize the property until he’s sentenced.
“The most likely outcome is that these properties will be seized,” Osler added reassuringly. “They’ll be sold, the public will get the money back.”
Must Read
- Dave Ramsey warns nearly 50% of Americans are making 1 big Social Security mistake — here’s what it is and the simple steps to fix it ASAP
- Robert Kiyosaki begs investors not to miss this ‘explosion’ — says this 1 asset will surge 400% in a year
- Vanguard reveals what could be coming for U.S. stocks, and it’s raising alarm bells for retirees. Here’s why and how to protect yourself
Join 250,000+ readers and get Moneywise’s best stories and exclusive interviews first — clear insights curated and delivered weekly. Subscribe now.
The difficulty of recovering stolen funds
Reassurances are nice but, when it comes to recovering stolen taxpayer funds, money talks loudest. The KSTP investigation notes that prosecutors say they’ve made headway in recovering “more than $60 million of the $250 million stolen from taxpayers.” Another story from the outlet in March, however, noted that around half of the $60 million came from the accused’s bank accounts, while the rest “is tied up in property including vehicles and real estate” both at home and abroad. (5)
And in October, when authorities said they’d recovered $70 million across three major Minnesota fraud cases, including the Feeding Our Future case, prosecutors specified that, again, the recovered amount “fluctuates” because some of the money was spent on items that decrease in value, like “luxury purses, boats and cars.” (6)
“We have property all over the state, in different parts of the country,” former acting U.S. Attorney for Minnesota Joe Thompson said at the time. “We recovered some property — a resort in Kenya on the Indian Ocean, for example. We recovered some property in Turkey. And we have to take efforts to liquidate that.”
All of which underscores the difficulty of retrieving money stolen through fraud — especially that which has already been spent.
Another such example arose in August, when a convicted Feeding Our Future collaborator named Abdiaziz Farah was sentenced to 28 years in prison and ordered to return almost $48 million in stolen funds. CBS News noted at the time, however, that the money had already been laundered internationally and “law enforcement agencies in the United States aren't able to get any money or real estate which are overseas.” (7)
Meanwhile, other fraud schemes orchestrated under the guise of pandemic relief have also struggled to recoup losses. In July, the Government Accountability Office (GAO) pointed to 19 different COVID-relief programs defrauded of more than a combined $300 billion. (8) Despite efforts from anti-fraud committees and congressional intervention, the GAO says that “over $16 million in recoveries” have been made as of last year.
Even former U.S. Attorney for Minnesota Erica MacDonald warned that, when it comes to the Feeding Our Future case, the stolen taxpayer money “isn’t going to all come back in.” She added that this situation should alert the public as to “why we need strong controls in place to make sure it doesn’t happen in the first place.” (5)
It’s little solace for Minnesotans who unknowingly got bilked out of a fortune in taxpayer cash, but MacDonald did note that the authorities attempting to recover the lost money will “use all the tools at their disposal to find every asset they can.
“I’ve worked with these folks in the U.S. Attorney’s office here in Minnesota,” she added, “and they are tenacious.”
Article sources
We rely only on vetted sources and credible third-party reporting. For details, see our editorial ethics and guidelines.
United States Attorney’s Office District of Minnesota (1, 2); KSTP-TV (3, 4, 5, 6); CBS News (7); U.S. Government Accountability Office (8)
You May Also Like
- Turning 50 with $0 saved for retirement? Most people don’t realize they’re actually just entering their prime earning decade. Here are 6 ways to catch up fast
- This 20-year-old lotto winner refused $1M in cash and chose $1,000/week for life. Now she’s getting slammed for it. Which option would you pick?
- Warren Buffett used these 8 repeatable money rules to turn $9,800 into a $150B fortune. Start using them today to get rich (and stay rich)
- Here are 5 easy ways to own multiple properties like Bezos and Beyoncé. You can start with $10 (and no, you don’t have to manage a single thing)
Mike Crisolago is a Staff Reporter at Moneywise with more than 15 years of experience in the journalism industry as a writer, editor, content strategist and podcast host. His work has appeared in various Canadian print and digital publications including Zoomer magazine, Quill & Quire and Canadian Family, among others. He’s also served as a mentor to students in Centennial College’s journalism program.
