Trump fraud czar nominee McDonald uses Minnesota fraud as DOJ blueprint

The campaign against fraud in Minnesota will serve as a blueprint for a new Justice Department office focused on protecting taxpayer dollars from fraud, the president said. Donald TrumpHe explained his choice to serve as the country’s “fraud czar” at his nomination hearing on Wednesday.

“The work in Minnesota has been pivotal. The work of the U.S. Attorney’s Office there, and the staff there, has been pivotal in highlighting the fraud problems that permeate our taxpayer-funded programs,” Colin McDonald, a nominee to be assistant attorney general for a new Justice Department division charged with rooting out fraud, said Wednesday.

He continued: “This type of effort… is what the National Fraud Section will look to undertake and expand its scope to an extent not seen before within the Department of Justice.”

Trump named McDonald as his nominee in January, just days after creating the Justice Department’s new National Fraud Enforcement Division that will “investigate, prosecute, and redress fraud affecting the federal government,” according to the FBI. The white house. The new office comes on the heels of a massive fraud scandal in Minnesota, where hundreds of millions of dollars were allegedly swindled from taxpayers through welfare and social services programs.

Colin McDonald appeared before the Senate Judiciary Committee on Wednesday morning, where lawmakers grilled the nominee about the new office, how it would operate and whether he would operate independently of the White House. (Graeme Sloan/Getty Images)

“I will be working with the general inspector community,” MacDonald continued. “With our federal agencies and our federal partners, and with our state and local partners to ensure that we find fraud where it occurs, that we have the resources to prosecute it, investigate it and prosecute it, and ultimately ensure that the fraud that we see annually, that is committed against these programs, is over.”

McDonald appeared before the Senate Judiciary Committee on Wednesday morning, where lawmakers grilled the nominee about the new office, how it would operate and whether he would operate independently of the White House.

Trump delivered his State of the Union address on Tuesday evening, announcing that Vice President J.D. Vance would lead the administration’s “war on fraud.”

McDonald explained that his office will work to address all cases of fraud that deplete taxpayers, citing Government Accountability Office data that estimates between $320 billion and $520 billion in taxpayer money is lost to fraud on an annual basis.

He continued: “My commitment is to work tirelessly to build a division, a national fraud enforcement division, where no fraud is too big for the Department of Justice, and no fraud is too small for the Department of Justice.”

Concerns about fraud surrounding Obamacare and seniors have been at the forefront of lawmakers’ minds.

Texas Republican Sen. John Cornyn noted that the GAO was unable to reconcile more than $21 billion in Obamacare marketplace subsidies in the 2023 tax year during his questioning of McDonald.

Sen. Chuck Grassley, R-Iowa and chairman of the Senate Judiciary Committee, left, and Sen. Dick Durbin, D-Illinois and ranking member of the Senate Judiciary Committee, during their confirmation hearing. (Graeme Sloan/Bloomberg via Getty Images)

The heavily revised review found that Minnesota Medicaid has widespread weaknesses

“I’m committed to working tirelessly to eliminate the kind of fraud that you’ve identified there, and to make sure that every dollar that’s supposed to go to these programs actually goes to the programs, to the beneficiaries, the intended beneficiaries of these programs, and not to the fraudsters. That’s my commitment,” McDonald told Cornyn during the hearing on potential fraud surrounding Affordable Care Act subsidies.

Scams targeting seniors were also highlighted throughout the hearing. Judiciary Chairman Chuck Grassley, R-Iowa, pressed McDonald on his efforts to protect seniors from scams, noting that America’s seniors lose $28 billion a year to financial schemes.

The fraud czar nominee pledged that the Justice Department would work to protect seniors from increasingly high-tech scams, which often involve using artificial intelligence to confuse and deceive people, noting that fraud affects entire families.

The Center for Quality Education in Minnesota has been found at the center of an alleged child welfare fraud scandal in the state. (Madeleine Foresti/Fox News)

“It is not just grandmothers and grandfathers, but also their family members who bear the brunt of these scams and the fraud being committed against them,” he added. “My grandmother, one of them, turns 89 in two days. I’ve witnessed these kind of efforts toward her. It’s a major issue that the Department of Justice is focused on, and we will use all the tools available to ensure that we combat this issue.”

Minnesota’s massive fraud case has reverberated across the country, as federal Republican lawmakers have reinvigorated calls to tighten and monitor the release of taxpayer money to various programs, most notably social and welfare offices.

Dr. Oz details ‘weaponization of fraud’ in Minnesota, estimates total Medicaid fraud at $100 billion

Trump highlighted the scams in his State of the Union address on Tuesday, claiming the scams are worse in states like California, Massachusetts and Maine.

“When it comes to corruption that is plundering — actually plundering America — there is no more stunning example.” MinnesotaMembers of the Somali community looted an estimated $19 billion from American taxpayers. “We have all the information,” Trump said Tuesday.

US President Donald J. Trump delivers the first State of the Union address of his second term before a joint session of Congress in the House chamber in Washington, DC, on Tuesday, February 24, 2026. Sitting behind him are Vice President J.D. Vance and Speaker of the House Mike Johnson (R-Los Angeles). (Kenny Holston/Pool via Reuters)

He continued: “In fact, the number is much higher than that, and the situation is worse in California, Massachusetts, Maine and many other states. This is the type of corruption that is tearing apart the fabric of the nation, and we are working on it in a way that you would not believe,” before appointing Vance as the head of the administration in charge of combating fraud.

The White House referred Fox Digital to Trump’s comments on the State of the Union and McDonald’s testimony when contacted for additional comment on federal anti-fraud efforts.

Federal welfare spending is a fraud — and taxpayers are paying the price

Vance joined Fox News Channel’s “America’s Newsroom” on Wednesday and said his efforts would include a “whole-of-government approach” to investigate fraud concerns, enlisting the Justice and Treasury Departments to lead the investigation into financial records.

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“There’s a whole set of tools that we have that have never been used, and the president and I talked about this a couple of months ago and said: What if we did everything we could to stop the fraud being committed against American taxpayers?” “The president said, ‘Great idea, let’s do it,’ and we’re going to work on that very aggressively over the next year,” Vance said.

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