California Congressman Accuses Governor of Widespread Budget Fraud and Illegal Payments

Rep. Ro Khanna, D-Calif., is escalating his public dispute with California Gov. Gavin Newsom over state budget practices.

Khanna has criticized Newsom for alleged widespread fraud in the state’s budget, stating that “one common concern I have heard from constituents all week who have flooded my inbox is about fraud, waste, and abuse in Sacramento.”

The Silicon Valley congressman announced plans to request hearings on state government programs he claims have led to illegal payments and eligibility errors. He also vowed to introduce legislation demanding a full independent audit of California’s budget.

“I believe we can and must ask those Americans who have done well to pay more so everyone has healthcare and education. In turn, we must provide an accountable and transparent government,” Khanna stated.

Khanna previously accused the state of squandering $72 billion in taxpayer dollars.

Both California Democrats are viewed as potential candidates for the 2028 presidential race.

Newsom has countered by criticizing Khanna’s support for a billionaire tax initiative the governor opposes. Known as the 2026 Billionaire Tax Act, this proposal would levy a one-time 5% tax on all “forms of personal property and wealth, whether tangible or intangible” held by billionaires in California during 2026 to fund state healthcare programs like Medi-Cal.

A Newsom spokesperson dismissed Khanna’s fraud claims. Director of Communications Izzy Gardon stated: “The Governor takes fraud seriously. He also takes accuracy seriously. We wish all elected leaders did, too.” Gardon added that they look forward to learning more about the ideas proposed on social media platforms.