The Office of the Legislative Auditor released its special review Child Care Assistance Program: Assessment of Internal Controls on Wednesday following up an initial investigation into daycare fraud allegations. The report found the Department of Human Services’ (DHS) program integrity controls are insufficient to effectively prevent, detect, and investigate fraud in Minnesota’s Child Care Assistance Program (CCAP).

“For over a year we have been trying to get to the bottom of the fraud ongoing within Minnesota’s Child Care Assistance Program. The recent reports have painted a disturbing picture of DHS’s operation illustrating an obvious lack of leadership or drive from the department to get to the bottom of these failures,” said Senator Justin Eichorn (R-Grand Rapids).  “These frequent government failures cannot continue to go unpunished as the average Minnesota family struggles to make it by. With the recommendations that we received from the OLA today the Senate will work to ensure that every dollar we would lose to fraud goes to serve its true purpose of helping Minnesota children and their families who need the support.”

Today’s OLA review also determined that DHS and local human services agencies must do more to develop, coordinate, and implement policies, processes, and resources to identify and respond to the risk of fraud in CCAP.

Earlier this session, the Legislative Auditor released its special review of the Child Care Assistance Program (CCAP) providing a broader view of daycare fraud allegations. The OLA’s report detailed widespread fraud in the program, lack of internal controls at DHS and a “serious rift” between the DHS Inspector General and CCAP investigators caused in part by DHS’s unwillingness to address the serious concerns about program integrity.

In response to OLA’s recent findings, Senate Republicans announced a plan this week to freeze spending on the controversial Child Care Assistance Program (CCAP) until the state can prove to the taxpaying Minnesotans that the rampant fraud has been sufficiently rooted out of the system.