Somali nonprofit got a million-dollar cut from Feeding Our Future fraud, prosecutors say
Diana E. Murphy federal courthouse is shown in Minneapolis Friday, May 17, 2024. Photo by Nicole Neri/Minnesota Reformer.
A nonprofit created 25 years ago to help Somali refugees and immigrants get on their feet received over $1 million overseeing other nonprofits that claimed to give out free food to children during the pandemic, according to evidence presented Wednesday in the federal Feeding Our Future trial.
A dizzying array of nonprofits were created or revived to participate in a U.S. Department of Agriculture program to provide free meals to children during the pandemic. Prosecutors have painstakingly laid out just a portion of what they say was a $250 million scam, in which people falsely claimed to have given out meals, in order to get rich quick. The first seven of 70 defendants are on trial this week, the fourth week of testimony in a trial that could last six weeks or more.
Prosecutors have detailed how the seven defendants were connected to 50 food distribution sites that claimed to serve 18.8 million meals, for which the defendants were paid $41 million.
One of the nonprofits that has shown up sporadically during 17 days of testimony is Somali Community Resettlement Services, which was formed in Rochester in 1999 “to directly respond to the needs of Somali refugees and immigrants, with an emphasis on personal capacity,” according to its website. A year later, it added a second location in Faribault, and in 2019, another in Minneapolis.
About a month ago, Rep. Hodan Hassan, DFL-Minneapolis, withdrew two bills that would’ve given the Somali nonprofit $6.5 million in grants. Hassan, who announced in February she will not seek re-election in November, did not respond to a request for comment, but evidence prepared for the federal trial linked the nonprofit to the Feeding Our Future case.
Now it’s more clear how the nonprofit is connected: It sponsored eight distribution sites in Minnesota cities where the defendants claimed to serve thousands of meals and snacks daily in 2020 and 2021, for which it was reimbursed over $2.9 million via sponsoring nonprofit Partners in Nutrition, which submitted claims to the state Department of Education, which administered the USDA program. Of that, the Somali nonprofit paid the defendants and their various entities purporting to be serving meals $1.83 million, meaning it kept nearly $1.1 million, according to evidence presented by prosecutors.
For example, Somali Community Resettlement Services sponsored a Faribault site that claimed to serve 2,000 snacks and meals per day, and a Minneapolis site at Madina Market & Grocery that was reimbursed after claiming to serve 3,000 snacks and meals every day.
Somali Community Resettlement Services, which did not respond to a request for comment, has not been charged with a crime.
The nonprofit took in less than $500,000 in revenue in 2019, and ended the year with a deficit, but its revenue went up to $1.2 million in 2020, then shot up to $4.1 million in 2021 and nearly $3 million in 2022, the last year available. The nonprofit had enough money to buy the 24,245-square-foot, historic Gale Mansion in Minneapolis in 2022 for $2.6 million.
An online state database of government spending, Open Checkbook, indicates the nonprofit gets about a half million dollars annually from several state agencies.
Hassan’s bills would have added considerably to that total. Three bills she authored would’ve given the nonprofit $7.5 million in grants for a mixed-use Minneapolis project, job training and workforce development.
Hassan made motions on the House floor to recall two of the bills, whose Senate companion bills were sponsored by Sen. Zaynab Mohamed, DFL-Minneapolis. One bill would have given the nonprofit a $5 million grant from the Department of Employment and Economic Development to address a “critical need for affordable housing and commercial space for the Somali community.” The money was earmarked to buy a three-acre parcel from the city of Minneapolis to develop a mixed-use residential and commercial development with at least 60 affordable apartments and 10 retail spaces.
Another Hassan bill would have appropriated $1.5 million in DEED workforce development funds for job training and placement. And an earmark in the Workforce Development Finance and Policy Committee’s finance bill included a $1 million grant for the Somali nonprofit for job training and placement before it was stripped from the bill.
Two Minnesota nonprofits are at the center of the case — Feeding Our Future and Partners in Nutrition — in what prosecutors say was the nation’s biggest pandemic relief fraud.
The defendants on trial this week are all connected to a Shakopee halal market called Empire Cuisine & Market, which enrolled in the federal program in April 2020 and opened distribution sites across the state. Prosecutors’ evidence has shown the defendants used the federal money to travel and buy cars, real estate, jewelry, property in Kenya and linens and tires from a Chinese company.
FBI forensic accountant Pauline Roase testified Wednesday that the largest food distribution site out of the 50 sites connected to the defendants was at the Dar Al-Farooq mosque in Bloomington, where they claimed to serve 1.9 million meals in 2021, for $4.9 million in reimbursement.
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