Minnesota Audit Flags Massive Fraud Risk in Post-George Floyd Activism Contracts

A recent audit has identified substantial risks of fraud and favoritism in Minneapolis's contracting practices for violence prevention programs established in the wake of George Floyd's death. The report, which reviewed spending from 2020 to 2025, found that the city has not provided adequate oversight for more than $36 million allocated to these initiatives.

The Neighborhood Safety Contract Management Audit Report highlights that the city's weak contract controls create a heightened risk of fraud and improper payments. Auditors discovered that contractors frequently submitted invoices with insufficient supporting documentation, and the city sometimes continued payments despite missing records or unresolved issues. The department also lacked a standardized process for site visits to verify service delivery.

According to the audit, improvements are still needed in invoice reviews, contract record preservation, documentation of contractor communications, and procedures for escalating concerns.

Critics argue that these issues are not new. Bill Glahn, a policy fellow at the Center of the American Experiment, stated that similar findings would likely result from audits of other city-administered grant programs. Glahn's previous reporting in 2023 raised questions about the effectiveness and financial viability of the city's violence-interrupter program. He noted that in 2022-23, the city committed up to $7.5 million to the initiative, with an additional $13 million budgeted for 2024-28, yet substantive evidence of reduced violent crime was not publicly available.

Glahn's investigation also revealed that some participating organizations had annual revenues or staffing levels significantly lower than the grants they received. One group, We Push for Peace, had staff members involved in violent incidents, including one instance captured on video of a violence interrupter assaulting a homeless man. Glahn expressed concern that the city prioritizes dispersing funds quickly over ensuring grant recipients are capable, track their work, or that the work benefits residents and taxpayers.

This audit follows extensive criticism of Minnesota's handling of fraud, particularly in programs like Feeding Our Future and fraudulent Medicaid initiatives, where insufficient on-site visits were cited as a major failing.

State Sen. Mark Koran previously told Fox News Digital that simple site visits could have exposed issues in the Feeding Our Future program, where businesses claimed to operate out of locations that did not exist or were public spaces. Glahn suggested that even basic reviews of tax records and financial statements could have disqualified many vendors from the start.

A Minneapolis city spokesperson acknowledged the audit, stating the department appreciates the auditor's recommendations and has already taken steps to improve processes and oversight. The spokesperson emphasized the department's commitment to helping people and improving lives, including enhancing operational methods.

Despite the audit not identifying specific instances of fraud, it raised alarms about the potential for such activity due to lax oversight. Social media commentary has drawn parallels to previous fraud schemes in Minnesota, suggesting a pattern of prioritizing fund disbursement over accountability.

Former Navy intelligence officer Phillip C. Parrish posted on X, formerly Twitter, that the situation represented a consistent business model of establishing moral emergencies, channeling funds through politically connected nonprofits, neglecting due diligence, and then resisting scrutiny regarding fund allocation.