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BELLEVUE—Washington State Republican Party Chair Jim Walsh criticized Democratic officials for their responses to an expanding federal investigation into alleged childcare fraud, accusing them of siding with potential wrongdoers over taxpayers amid claims the schemes have spread from Minnesota to states including Washington.

The Federal Bureau of Investigation (FBI) has launched a nationwide probe into phony childcare centers accused of bilking billions in taxpayer dollars for nonexistent services, with the U.S. Department of Health and Human Services (HHS) halting funds to at least one state, Minnesota, pending audits. What began as allegations centered in Minnesota has drawn scrutiny to similar operations in Maine, Ohio and Washington, prompting federal agents to broaden their efforts.

Walsh, in a statement released Tuesday, December 31, pointed to reactions from key Washington Democrats as evidence of misplaced priorities. Attorney General Nick Brown issued a statement addressing reports of harassment against daycare providers, saying, “Showing up on someone’s porch, threatening, or harassing them isn’t an investigation. This is unsafe and potentially dangerous behavior.”

Brown urged those facing threats to contact his office’s Hate Crimes & Bias Incident Hotline and directed concerned residents to the state’s Department of Children, Youth and Families. Walsh questioned this guidance, suggesting DCYF officials could be implicated if the fraud claims hold up. Brown made no mention of cooperating with the FBI, Walsh criticized.

Governor Bob Ferguson, meanwhile, met with Somali American community leaders to address fallout from the scandal, Walsh noted. In a written statement on X, Gov. Ferguson wrote, “I met with Somali American community leaders today to discuss the deep damage inflicted by Donald Trump’s harmful rhetoric. Here in Washington state, we recognize that diversity is a strength.”

Walsh described Ferguson’s response as deflecting to unrelated political rhetoric while ignoring the core fraud allegations.

State Sen. Lisa Wellman (D-Mercer Island) drew Walsh’s sharpest rebuke for pre-filing Senate Bill 5926, which would expand public records exemptions to shield personal information for all licensed or certified childcare providers. The measure, introduced amid a growing national fraud investigation, could limit public access to details about taxpayer-funded centers and their operators. Walsh called the timing of the proposed bill suspicious, likening it to a potential cover-up similar to the Minnesota schemes.

The Minnesota scandal erupted after a video by Nick Shirley, an up-and-coming independent journalist, exposed over $110 million in alleged fraudulent claims in a single day, showing empty buildings billed as daycares and funds diverted elsewhere.

FBI Director Kash Patel confirmed that the FBI had surged resources to dismantle such schemes, prioritizing them nationwide. HHS activated a “Defend the Spend” system requiring evidence for payments, freezing Minnesota’s federal childcare funds and demanding audits.

In Washington state, the FBI’s Seattle office is part of the expanded probe into similar fraud involving taxpayer funds, though specifics remain limited. Local daycares, particularly those serving Somali communities, have faced increased scrutiny and reports of harassment following the Minnesota revelations.

Walsh argued the Democrats’ responses reveal a pattern: assuming ill intent from the public, echoing talking points on rhetoric and diversity, and overlooking the fraud itself.

“This is a failure of state government,” he said. “Meanwhile, the FBI is investigating.”

Federal officials have tied the schemes to broader issues, including past convictions in Minnesota’s $250 million Feeding Our Future fraud during the pandemic. Federal investigations now encompass Medicaid, Small Business Administration, Department of Labor, and U.S. Treasury, with potential links to overseas transfers to terrorist organizations.

The US House Oversight Committee on December 31 announced two Hearings on the alleged fraud in Minnesota’s Social Services Programs. Minnesota Governor Tim Walz and AG Keith Ellison are to testify on February 10; Representatives Kristin Robbins, Walter Hudson, and Marion Rarick are to testify to Congress on January 7, 2026.

Below is the statement from Washington State GOP Chair Jim Walsh in its entirety on Washington state Democrats’ responses to Minnesota’s alleged childcare center fraud scandal:

The Federal Bureau of Investigation has announced a nationwide investigation into allegations of widespread fraud perpetrated by phony ‘childcare centers’ that receive taxpayer dollars. The alleged schemes—which involve phony or non-existent ‘childcare centers’ receiving taxpayer money for services never provided—are serious, credible and involve billions of dollars.

The Federal Department of Health and Human Services has stopped sending relevant funds to at least one state government until the alleged “childcare center” frauds are properly investigated.

While these “childcare center” fraud allegations were initially concentrated in one state—Minnesota—subsequent allegations have involved the states of Maine, Ohio and Washington. This is why the FBI is setting up its investigation as a nationwide project.

Here in Washington, some elected officials have reacted to this news inappropriately.

Washington’s chief law enforcement official, Attorney General Nick Brown, released a poorly-written statement that seems to take the side of the alleged swindlers and stand against concerned taxpayers and the general public. “Showing up on someone’s porch, threatening, or harassing them isn’t an investigation,” Brown’s grammatically challenged statement reads. “This is unsafe and potentially dangerous behavior.”

Brown then encourages alleged swindlers to contact his department’s widely-criticized “Hate Crimes & Bias Incident Hotline’ to report ‘experiencing threats or harassment.” Brown tells concerned taxpayers to contact the state’s Department of Children, Youth and Families (DCYF). Questionable advice: If the allegations are true—DCYF bureaucrats are complicit in the “childcare center” fraud.

Brown did not make any offer to assist or cooperate with the FBI’s investigation.

Current Governor Bob Ferguson hasn’t done much better. Unable to answer unscripted media questions coherently, he issued a written statement: “I met with Somali American community leaders today to discuss the deep damage inflicted by Donald Trump’s harmful rhetoric…. Here in Washington state, we recognize that diversity is a strength.”

In other words, Ferguson reverted instinctively to President Donald J Trump (who has little to do with this scandal) and the passive-aggressive race-baiting of appeals to “diversity.”

The worst reaction may have come from Democrat State Sen. Lisa Wellman. She has pre-filed Senate Bill 5926, “An Act Relating to expanding the public records exemption for personal information to all licensed or certified child care providers.”

The suspiciously-timed bill would remove the public’s ability to request information about childcare centers that receive taxpayer money—and the people who operate those centers. To many Washingtonians, Wellman’s bill looks like a cover-up of exactly the sort of fraud that’s been going on in Minnesota.

The responses of Ferguson, Brown and Wellman have been inappropriate—and consistently so. All three Democrats bolt to the side of alleged wrongdoers. And against wronged taxpayers. All three assume bad intent on the part of the public. All three parrot scripted talking points that criticize the “rhetoric” of others—while ignoring the alleged fraud at the core of the current scandal.

This is a failure of state government. Meanwhile, the FBI is investigating.

Author: Mario Lotmore