State Senate GOP leader blasts education department for 'derelictions of duty' that led to massive fraud

The Minnesota Department of Education "greatly magnified" the amount of alleged fraud that took place at Feeding Our Future and its subcontractors through "inexplicable shortcomings and derelictions of duty," according to a new report by Senate Education Committee Chairman Roger Chamberlain, R-Lino Lakes.

The report, issued Monday, concluded that leaders of the education department [MDE] "either did not know how to responsibly manage" the federally funded meals program or "found the faithful execution of those duties burdensome and optional."

MDE officials declined an interview request, but spokesman Kevin Burns defended the department's oversight of the meals program, noting MDE reported its fraud suspicions to the FBI and the U.S. Department of Agriculture, which oversees the $200 billion meals program.

"MDE moved quickly and repeatedly raised the issue to federal authorities until we were able to find someone who would take the troubling spending as seriously as we were," Burns said in the statement.

"Even when MDE stopped payments to Feeding Our Future, a court informed MDE the payments must continue. Because of MDE's early action, the federal government opened an investigation, which we have fully supported."

Officials with the U.S. Department of Agriculture have declined to comment, citing the ongoing FBI investigation.

Sen. Charles Wiger, the ranking Democrat on the education committee, criticized Chamberlain for releasing his report without consulting the full committee. He accused Chamberlain of making a "partisan attack" aimed at hurting Democratic candidates in the fall elections.

"Could there have been additional things done? Yes," said Wiger, DFL-Maplewood. "And [MDE officials] have noted that more steps could have been done or should have been done. But it is under investigation now, and we are awaiting the findings."

More than 200 law enforcement officers raided the headquarters of Feeding Our Future and several of its key subcontractors Jan. 20, after the FBI accused the group of misappropriating more than $40 million from programs aimed at providing meals to low-income children.

Altogether, Feeding Our Future collected $197 million in federal reimbursements in 2021 as meal demand skyrocketed during the pandemic — up from $307,000 in 2018. The nonprofit shut down in February.

So far, a federal grand jury has not charged anyone with a crime related to the alleged fraud. Feeding Our Future Executive Director Aimee Bock has denied wrongdoing.

According to Chamberlain's report, the state education department failed to act on early warnings of fraud involving Feeding Our Future.

USDA officials received a complaint accusing Bock and Feeding Our Future of "forgery and theft" in a February 2019 letter from Kara Lomen, who was then the executive director of Partners in Nutrition, Bock's former employer.

In the letter, which was obtained by the Star Tribune, Lomen said Feeding Our Future was created by the leaders of Partners in Nutrition when the nonprofit was mired in a lengthy dispute with the MDE over its application in 2017.

After the Minnesota Court of Appeals rejected the department's ruling against Partners as "arbitrary and capricious," Lomen and her colleagues did nothing further with Feeding Our Future, conducting all business through Partners, according to the letter.

Lomen said Feeding Our Future was not revived until after Bock was "terminated for misconduct" from Partners in June 2018. Lomen said Bock "stole the electronic files associated with Feeding Our Future," and forged Lomen's signature on various corporate documents as part of Feeding Our Future's new application for the meals program.

"These are pretty serious allegations," Chamberlain said in an interview Monday. "They should have looked into it. You shouldn't just blow them off."

In the complaint, Lomen also accused Feeding Our Future of providing "false information" to her subcontractors about how the meals program was supposed to operate. For instance, Lomen said Feeding Our Future told subcontractors that they could claim reimbursement for meals "that are not actually served to children."

In affidavits supporting the search warrants in January, FBI officials said their investigation showed that some of Feeding Our Future's subcontractors received millions of dollars in reimbursements for meals that were never delivered.

Through her attorney, Kenneth Udoibok, Bock has declined to comment on Lomen's allegations.

"We wait for the federal government's charging decisions," Udoibok said recently in a written response to questions. "But we expect that Ms. Bock will not be charged because she did not commit any crimes."

In his report, Chamberlain faulted MDE for not putting extra scrutiny on large nonprofits, such as Feeding Our Future, that were obtaining millions of dollars in reimbursements each month. He said evidence collected by his committee shows that Feeding Our Future was treated the same as smaller nonprofits that were getting thousands of dollars monthly.

"That was a great surprise," said Chamberlain, the Senate assistant majority leader. "They completely failed at all of these levels. They didn't detect (the fraud). And they didn't do anything to prevent or stop it. The only thing they've taken credit for is notifying the FBI."

Other Republicans on the committee backed Chamberlain's findings.

"I am hopeful that everyone, including the Department of Education, can take away some lessons on how to provide better oversight in the future," said Sen. Zach Duckworth, R-Lakeville.

Chamberlain and Wiger agreed that the state legislative auditor should dig deeper into the MDE's oversight of the meals program.

"We are planning on conducting a special review related to the department's oversight of these funds, and we are hoping to kick off that review soon," Legislative Auditor Judy Randall said Monday.