Two of the country’s best-known church charities, Catholic Charities and Lutheran Social Services, were paid $62 million in government money to resettle Somali refugees in Minnesota, according to a New York Post report published Oct. 16, 2026. The Post’s reporting traces how a federally funded resettlement pipeline built Minnesota’s Somali community, which the Post says is the source of much of the welfare fraud that has engulfed the state.
None of this was done in secret. It was done in the open, with taxpayer money, through federal resettlement contracts stretching back decades.
A “very big pile of government money”
According to the Post, the two church groups have resettled an estimated 29,000 Somalis in Minnesota since 1993, collecting a reported $2,500 per refugee to cover food, initial housing and social workers. The $62 million figure appears in the Post’s headline; the article does not lay out a line-by-line breakdown of how that total was calculated.
Parker Thayer, an immigration researcher at the Washington-based Capital Research Center, told the Post that resettlement has turned into a business with many hands out. “This is a very big pile of government money and a whole bunch of different groups have come to get their own slice of it,” he said. Thayer put the total flowing into Minneapolis resettlement programs alone “in the hundreds of millions.”
He also pointed to the national level. Since 2021, Thayer said, the U.S. Conference of Catholic Bishops, which oversees Catholic Charities, has received $140 million in migrant resettlement contracts from the federal government.
That relationship has since collapsed. After the Trump administration suspended refugee admissions in January 2025 and suspended the bishops’ cooperative agreements to resettle refugees, the conference announced on April 7, 2025, that it would not renew its federal contracts. “For half a century, we have been willing partners in implementing the government’s refugee resettlement program,” Archbishop Timothy Broglio, the conference president, said at the time, adding that “we simply cannot sustain the work on our own at current levels or in current form.” A conference spokesperson said the bishops were still seeking more than $24.3 million in reimbursements for resettlement work.
How Minnesota became the destination
The Post traces the pipeline to the Vietnam era, when Minnesota became a test ground for resettling Hmong refugees from Laos; the first Hmong family arrived in the state in 1975. Church resettlement agencies, which had helped Christians displaced from war-torn Europe as far back as World War II, became the federal government’s natural partners. When Somalia fell into civil war in the 1990s, the Post reports, the Minnesota operation was “an established, well-oiled machine.”
The Post reports that Minnesota’s Somali population now tops 100,000, fueled by family reunification and by a state welfare system generous enough to draw Somalis who were first resettled elsewhere. “They picked Minnesota because it had extremely generous state social safety net policies and welfare programs, which of course made resettling refugees there easier,” Thayer said. “Refugees from Somalia then moved to Minnesota after they were resettled elsewhere, in places like South Dakota.”
His warning about what that concentration produces: “They’re creating multiple problems by resettling large numbers of people in one area at the same time they’re creating isolated ethnic enclaves across America, which seem to be causing some cultural problems.”
The fraud bill
That concentration is now the backdrop to what may be the biggest welfare fraud case in American history. In December 2025, First Assistant U.S. Attorney Joe Thompson said 14 Minnesota Medicaid services deemed “high risk” had billed about $18 billion since 2018, and that a significant share could be fraudulent. “When I say significant amount, I’m talking on the order of half or more,” he said. That put the potential loss at $9 billion or more. “I see more red flags than I see legitimate providers,” Thompson added.
The U.S. Attorney’s Office said more than 90% of the people charged in the major fraud cases announced before that December press conference were of Somali descent. Thompson said the exact amount is still under investigation, and Gov. Tim Walz said a state audit would give a better picture of the extent of the fraud.
The scandal has also reached the community’s most prominent politician. On Oct. 12, Homeland Security Investigations executed a judicially authorized search warrant at Rep. Ilhan Omar’s Washington, D.C.-area home as part of what the Justice Department called an ongoing criminal investigation. Sources told ABC News the probe relates to Omar’s immigration paperwork. Omar, who came to the United States as a Somali refugee, has not been charged, denies wrongdoing and called the search “an attempt to target political enemies and weaponize federal law enforcement.”
The other side, and the real question
The charities’ defenders have a point worth stating plainly. Resettlement agencies do not pick which refugees come to America; the federal government selects and vets them overseas. A North Dakota News Cooperative fact-check found that Lutheran Social Services receives a standard one-time grant of about $2,000 per refugee, regardless of nationality, and that agencies are not paid to bring specific groups to particular states. Nothing in the Post’s reporting shows that either charity took part in the Medicaid fraud.
The groups also aren’t what they were. A spokesperson for Catholic Charities Twin Cities told the Post it closed its refugee and immigrant programs in 2018. Lutheran Immigration and Refugee Service, the national Lutheran resettlement agency, renamed itself Global Refuge in January 2024. Lutheran Social Services of Minnesota did not respond to the Post’s request for comment.
But the question isn’t whether a church charity stole money. It’s whether anyone was responsible for what happened after the contract was paid. For three decades the federal government paid nonprofits to place tens of thousands of people in one state, and the state’s own programs paid out billions in benefits that prosecutors now suspect were defrauded on a historic scale. Kelsey Reinhardt, president of CatholicVote, put the moral side of it to the Post: “The gospel mandates the welcoming of strangers but there’s no unbridled welcoming of people, for example those who hate you or who are going to kill or steal from you.” She added: “What extent are we able to assimilate people? Is the vetting sufficient?”
Thayer also warned that the controversy is costing the charities themselves, telling the Post it is “hurting the ability of these organizations to fundraise in arguably more important areas of their work.”
Charity is a virtue when it’s your own money; when it’s the taxpayers’, someone has to answer for the results.
Sources
- New York Post: Two Christian groups were paid $62M to resettle tens of thousands of Somalis in Minnesota (Oct. 16, 2026)
- CBS News: At least $9B billed across 14 Medicaid services in Minnesota may be fraudulent, top prosecutor says (Dec. 18, 2025)
- Trenton Monitor (OSV News): USCCB ends cooperative agreements with US government after work suspended (Apr. 7, 2025)
- ABC News: Rep. Ilhan Omar's residence searched as part of ongoing criminal investigation, DOJ says (Oct. 12, 2026)
- North Dakota News Cooperative via Gigafact: Does Lutheran Social Services get special payments for bringing Somali immigrants into North Dakota and Minnesota?
- Global Refuge: Lutheran Immigration and Refugee Service becomes Global Refuge (Jan. 17, 2024)
