Gov. Walz announces new position to combat fraud in Minnesota service programs

By: - December 12, 2025 3:21 pm

Tim O’Malley, the state’s new Director of Program Integrity, speaks at a Capitol press conference announcing his appointment Friday Dec. 12, 2025. (Photo by Alyssa Chen/Minnesota Reformer.)

Gov. Tim Walz announced a new role aimed at preventing fraud in state-run human services programs on Friday following years of widespread abuse that has siphoned away hundreds of millions of dollars intended to help vulnerable populations and created a crisis of confidence in his administration.

Tim O’Malley, a former superintendent of the Minnesota Bureau of Criminal Apprehension under Republican Gov. Tim Pawlenty, will be the state’s new Director of Program Integrity starting next month.

“I’m honored that Governor Walz has asked me to assist in combating fraud here,” O’Malley said at a news conference. “I’m not here to serve any individual, and I’m not here to serve a political party. I’m here to serve Minnesotans.”

He added that the governor had privately assured him that “all of us have the freedom and the autonomy to act to do whatever is necessary to solve this.”

Minnesota Republican lawmakers criticized the appointment as too little, too late.

Rep. Kristin Robbins, a Republican gubernatorial challenger to Walz and chair of the House fraud prevention committee, said in a statement, “The Walz fraud prevention program should be his resignation.”

O’Malley will begin the new role once he finishes his current role as interim chief judge of the Court of Administrative Hearings.

O’Malley said he doesn’t have specifics on what the work will entail, though he said, “I believe we’re well positioned to address this.”

Walz also announced a new contract with WayPoint, a firm based in White Bear Lake owned by Josiah Lamb, to develop a “toolkit” of procedures for state agencies to better prevent and address fraud. The contract is currently for up to $200,000, said Bureau of Criminal Apprehension Superintendent Drew Evans.

O’Malley worked at the Minnesota Bureau of Criminal Apprehension from 1989 to 2010. He has also been an FBI SWAT team member and sniper. In 2014, O’Malley was hired by the St. Paul-Minneapolis Archdiocese to oversee its response to clergy sex abuse.

Fraud in Minnesota’s human services has become a high-profile political issue, drawing attention from President Donald Trump, who has used the issue to attack Minnesota’s Somali-American community.

Federal authorities have already charged scores of people for allegedly defrauding a pandemic-era child nutrition program, an autism treatment program and Housing Stabilization Services. Former acting U.S. Attorney for the District of Minnesota Joe Thompson estimated the total amount in fraud in state programs could exceed $1 billion.

Meanwhile, Minnesota’s Department of Human Services has started addressing fraud in other services, pausing payments in a service called Integrated Community Supports starting in September and implementing a prepayment review process for 14 programs, including ICS, starting in December.

Integrated Community Supports is a Medicaid-funded service that helps people with disabilities live independently in the community rather than in an institution. In a statement late November, DHS confirmed that there were 50 active payment withholds affecting 17 ICS providers, citing credible allegations of fraud.

A repeated refrain of the press conference was that there are active investigations into human services fraud, which officials said limited what information they could openly discuss. Walz also referenced “a Medicaid program” where much of the fraud, in terms of money, is coming up.

Evans said to expect “additional prosecutions related to some of these Medicaid programs.”

“The bulk of what I would consider the most egregious and legitimate tips and referrals coming through that portal were absolutely related to this Medicaid program, which is not news to the state,” Evans added.

Neither Evans nor Walz returned questions clarifying whether they were referring to a particular Medicaid service or Medicaid programs as a whole.

DHS Temporary Commissioner Shireen Gandhi said that the Office of the Inspector General has more than 1,300 open cases and has identified over $50 million for recovery over the past 5 years. She said that DHS Inspector General James Clark, who was not present Friday, told her that “fraud schemes are evolving and DHS needs to do more to get ahead of criminals.”

“If you get caught stealing from Minnesota’s most vulnerable people, I hope you go to prison,” Gandhi said.

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Alyssa Chen
Alyssa Chen

Alyssa Chen is a Reformer data reporter with a focus on health care policy. Previously, she was a research assistant in health policy at Harvard Medical School. She graduated from Harvard with a degree in statistics.

Minnesota Reformer is part of States Newsroom, the nation’s largest state-focused nonprofit news organization.

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