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FBI raids Twin Cities businesses suspected of ‘massive fraud’ in child food programs

The FBI alleges in search warrant affidavits that Feeding Our Future, the state’s largest independent sponsor of federal food programs, submitted false reimbursement records and conspired with business owners who stole and laundered funds as part of a “massive fraud” involving shell companies, kickbacks and dozens of bank accounts.

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A screenshot from a portion of the Feeding Our Future website. Federal authorities say Feeding our Future, a St. Anthony, Minnesota-based nonprofit, is suspected of defrauding two federal meals-for-kids programs out of many millions of dollars.
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ST. PAUL -- A Twin Cities nonprofit and a web of business operators stole tens of millions of dollars in federal funds that were supposed to help feed needy children while schools were closed during the coronavirus pandemic, according to court records.

More than 200 agents of the FBI and other state and federal agencies raided over a dozen locations Thursday, including the St. Anthony offices of Feeding Our Future and the Rosemount home of its director, Aimee Bock.

The FBI alleges in search warrant affidavits that Feeding Our Future, the state’s largest independent sponsor of federal food programs, submitted false reimbursement records and conspired with business owners who stole and laundered funds as part of a “massive fraud” involving shell companies, kickbacks and dozens of bank accounts.

“The companies and their owners received tens of millions of dollars in federal funds for use in providing nutritious meals to underprivileged children and adults,” an FBI agent wrote. “Almost none of this money was used to feed children. Instead, the participants in the scheme misappropriated the money and used it to purchase real estate, cars and other luxury items.”

No criminal charges have been filed, and the FBI said it did not arrest anyone Thursday.

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The Minnesota Department of Education on Thursday moved to terminate Feeding Our Future as a sponsor and cut off funding through the U.S. Department of Agriculture’s Summer Food Service Program and Child and Adult Care Food Program.

The department also suspended reimbursements for a second sponsor, Partners in Nutrition — also known as Partners in Quality Care — based on information in the search warrants. Bock used to work for Partners in Nutrition.

Pandemic rules

The two federal food programs typically provide meals for needy children during summer, when schools are closed, as well as meals and snacks for kids in child care and afterschool programs.

But early in the pandemic, when many schools closed to keep the virus in check, the USDA broadened eligibility for its food programs, letting restaurants participate, authorizing meals in higher-income neighborhoods and allowing for the distribution of multi-day packs of food to be eaten off-site.

Meanwhile, many employees in the Minnesota Department of Education, which oversees the food programs, were ordered to work from home.

“According to MDE officials, this left the program vulnerable to fraud and abuse,” the FBI wrote.

The education department’s workload soared as a result of the new USDA rules. It usually gets around 80 requests each year for new food sites. During the first half of 2021, it received 838 requests.

Concerned about its inability to verify claims, the department was preparing to dramatically reduce the number of food distribution sites last summer before relenting under pressure from anti-hunger advocates.

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Kickbacks, laundering

Bock’s Feeding Our Future has been a major beneficiary of the USDA’s pandemic waivers.

Formed in 2017, the nonprofit took in $3.5 million in food reimbursements in 2019, $42.7 million in 2020 and $197.9 million last year. The sponsor charged a 10 percent administrative fee on those reimbursements through its contracts with site operators, many of which were run by members of the East African diaspora.

Several site operators spent little or none of that money on food for children, the FBI alleges.

Feeding Our Future itself claimed to have operated a number of high-volume distribution sites, but visiting FBI agents found the parking lots empty.

The warrants say Feeding Our Future employees, as well as multiple business operators, set up shell companies they used to hide proceeds from the scheme.

The FBI also found evidence that Bock received a $310,000 kickback from one of the businesses and that her boyfriend, Empress Malcolm Watson Jr., created his own shell company to hide some $600,000 in federal money.

No one answered a call to the Feeding Our Future office Friday, and the company’s attorney did not return a phone message.

Lawsuit

Education department spokeswoman Ashleigh Norris said the office reported Feeding Our Future’s activities to the USDA’s regional office and inspector general when the nonprofit was unable to explain and document its rapid growth in summer 2020.

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Then, in November 2020, Feeding Our Future sued the education department for taking too long to approve its applications for dozens of new sites, claiming the agency was discriminating against minority-owned businesses and they families they served.

A month later, the department denied dozens of site applications for exceeding regulatory limits on the number of children served. It later declared the nonprofit “seriously deficient,” denied more applications to open new sites, and in March halted payments to Feeding Our Future while it worked to verify the reimbursement claims.

Among its concerns, the department said Feeding Our Future was submitting claims for the maximum number of meals each month and that the department had received complaints that some registered sites weren’t serving any meals.

Bock also was managing a huge amount of revenue on her own despite “no formal financial experience or education,” the agency said in response to the lawsuit. “ … It is not reasonable for a sponsor to have one person in charge of all operations and finances with a revenue of this degree.”

Contempt, investigation

Nonetheless, in April 2021, Ramsey County District Judge John Guthmann found the education department in contempt of court for violating its agreement to quickly approve new site applications.

The department was ordered to pay the nonprofit $47,500; the case still is pending.

That same month, the education department told the FBI that Feeding Our Future was “submitting fraudulent documents to support reimbursement of funds in addition to artificially inflating the number of children and low-income individuals receiving benefits,” according to a search warrant.

When the FBI began investigating in May, it obtained bank records that it said “showed a massive fraud scheme” and “several companies that were receiving a suspiciously high amount of reimbursements.”

Businesses named

The businesses named in the warrants include Safari Restaurant and Event Center in Minneapolis, which claimed it was serving 5,000 meals a day, seven days a week, in July 2020.

The FBI said Safari and related companies received more than $10 million in reimbursed funds and “almost none” was spent on food for kids.

One of the owners, Salim Said, allegedly spent misappropriated funds on a $950,000 house in Plymouth with an indoor basketball court, while another owner, Abdulkadir Nur Salah, gave Bock a $310,000 kickback. The FBI alleged Said and Ahmed Omar-Hashim spent $2.8 million on a Minneapolis office building.

Others reportedly connected to the Safari group are Abdihakim Ali Ahmed, Abdirahman Ahmed, Sagal Aden, Hadith Yusuf Ahmed, Ahmed Artan, Ahmed Ghedi, Abdinasir Abshir and Abdikadi Mohamud.

Feeding Our Future employees Abdikerm Abdelahi Eidleh and Hadith Yusuf Ahmed are suspected of setting up shell companies to hide money.

Other groups

Others named in the warrants include ThinkTechAct, a.k.a. Mind Foundry Foundation, operated by Mahad Ibrahim, which reportedly received over $16 million last year after claiming to have fed 160,666 kids a day at 10 locations.

The FBI said “little, if any” of that money actually was spent on meals for children.

Instead, the FBI said most of the money was laundered through multiple businesses and their owners — Abdiwahab Aftin, Mohamed Jama Ismail, Abdimajid Mohamed Nur and brothers Abdiaziz and Said Farah, of Bushra Wholesalers and Empire Cuisine and Market – who later bought cars and real estate in Minnesota and Kenya.

A major player appears to have been S&S Catering, led by Qamar Ahmed Hassan. The FBI says S&S received $13.8 million in federal funds, either directly from sponsors Feeding Our Future and Partners in Nutrition, or from other businesses, but spent little of it on food for kids.

Its partners included St. Paul’s Youth Inventor’s Lab, led by Bekam Merdassa, who received $3.6 million in reimbursements last year; Academy for Youth Excellence, run by Sahra Mohamed Nur, who received $4.1 million; Guhaad Said’s Advance Youth Athletic Development, aka Central Avenue Lofts, which got $3.2 million; and Filsan Mumin Hassan’s Youth Higher Educational Achievement, which got $1.4 million.

Mara H. Gottfried contributed to this report. 

Related Topics: CRIME AND COURTSNONPROFITS
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