U.S. Launches ‘Defend the Spend’ Initiative to Prevent Child Care Fraud

Health and Human Services Assistant Secretary Alex Adams, who oversees the Administration for Children and Families (ACF), announced Wednesday that federal funds will be distributed to states only after rigorous verification of legitimate use.

Adams revealed that a $9 billion welfare fraud scandal in Minnesota has impacted Americans nationwide.

“One of the programs under investigation is the Child Care Development Fund,” Adams stated during an interview on “Finnerty.”

“American taxpayers allocate $185 million annually to Minnesota for child care support and workforce participation initiatives,” Adams added.

“When funds fail to reach children or are diverted by fraudsters, they lose their intended purpose,” Adams emphasized. “Taxpayers deserve accountability for these resources.”

The ACF has implemented multiple safeguards to prevent financial diversion. A reporting line is now active at childcare.gov for fraud, waste, and abuse complaints.

“Within hours of launching, the tip line generated over 75 reports from across multiple states,” Adams reported.

Under the new ‘Defend the Spend’ initiative, payments will require photo evidence or receipts demonstrating legitimate use—such as payroll records or attendance vouchers.

Adams noted that ACF has requested specific documentation from Minnesota daycares suspected of fraudulent activity.

“We sought licensing inspection reports and internal fraud investigation records,” Adams explained.

Adams criticized Minnesota Governor Tim Walz for his role in what many describe as the nation’s largest fraud scandal.

“He is not taking action,” Adams stated. “We will address this issue thoroughly.”

Previously, ACF sent letters to Minnesota seeking details about subsidy allocations but received no response.

“We had to issue a follow-up request and temporarily halt disbursements until verifiable information is provided,” Adams said.