Funding for Minnesota child care centers paused

"That money should be helping 19,000 American children, including toddlers and infants," Adams said. "Any dollar stolen by fraudsters is stolen from those children."

Adams said officials in Minnesota could not confidently confirm or deny the extent of the suspected fraud examples. 

Jim O'Neill, deputy secretary of Health and Human Services, said the department implemented required verification for all ACF child care payments. The verification process requires a justification, receipt or photo evidence before making a payment

"We believe the state of Minnesota has allowed scammers and fake day care centers to siphon millions of taxpayer dollars over the past decade," O'Neill said. 

O'Neill also demanded Democratic Minnesota Gov. Tim Walz conduct a thorough review of Minnesota's day care centers. 

"Regardless of rank or office, anyone who is involved in perpetrating this fraud against the American people should expect to be prosecuted to the fullest extent of the law," O'Neill said. 

The first allegations of fraud came in late November when reports stated millions of taxpayer dollars had been stolen from the state's welfare system and sent to a Somali-based terror group. 

Fraud allegations intensified when independent journalist Nick Shirley posted a video last week, claiming to reveal $110 million in fraud at Minnesota child care centers. 

HHS also launched a hotline for individuals to report fraud in the child care system in any state.