On January 3, 2025, Governor Walz issued an executive order to establish the Financial Crimes and Fraud Section within the Department of Public Safety (DPS). To create this new fraud unit, the governor is moving Commerce Fraud Bureau (CFB) staff and funding from the Department of Commerce to the DPS Bureau of Criminal Apprehension (BCA). On Thursday, the Senate Commerce Committee held an informational hearing to better understand why the governor ordered this transfer. The committee heard testimony from Commerce Commissioner Grace Arnold, BCA Superintendent Drew Evans, and DPS Commissioner Bob Jacobson.

Senator Gary Dahms and committee members of the committee expressed strong concern about moving the CFB outside of the jurisdiction of Commerce. The main issue is whether the move is just a rebranding or if it expands the scope to tackle more types of fraud beyond insurance fraud. Currently, statutory funding for the CFB is tied to insurance fraud, with a limited scope dedicated to investigating insurance fraud, financial crimes, and auto theft. The worry is then that DPS could start using CFB funding to investigate other types of fraud, shifting its focus away from insurance fraud and leading to Minnesota policy holders paying higher premiums.

“The governor’s decision to move the Commerce Fraud Bureau to a new fraud unit within the Department of Public Safety is very problematic,” Senator Dahms said. “This just seems like a way for the governor to say he is tackling fraud without actually addressing the issue.”

Click here to watch the full hearing.