Key Takeaways
- •The hearing revealed systemic fraud and foreign influence in state and federal programs, with calls for increased accountability and prosecution to protect taxpayer dollars.
- •Witness Talcove estimated annual fraud losses at $1 trillion, funding terrorism and child trafficking, recommending front-end identity verification, recertification, third-party audits, and federal law enforcement.
- •Senator Hawley (Republican-MO) pressed Mr. Bruner (Witness) on foreign funding for anti-ICE protests, who cited Neville Roy Singham (pro-CCP) and Swiss billionaire Hansjörg Wyss.
- •Republicans (Hawley, Scott, Moreno, Johnson) emphasized foreign influence and state accountability for fraud, while Democrats (Kim) urged bipartisan, national solutions and protection of legitimate protest.
- •Chairman Hawley (Republican-MO) called for Department of Justice investigations and prosecutions of dark money groups and foreign actors funding illegal activities and protests.
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Hearing Analysis
Overview
On February 10, 2026, the Senate Homeland Security and Governmental Affairs Subcommittee on Disaster Management, District of Columbia, and Census held a hearing titled "Examining Fraud and Foreign Influence in State and Federal Programs." Chaired by Sen. Josh Hawley (R-MO), the hearing focused on two primary concerns: the systemic siphoning of taxpayer funds from social safety nets and the alleged role of foreign-funded dark money networks in orchestrating domestic civil unrest. The proceedings highlighted Minnesota as a "ground zero" for fraud, while also addressing a national crisis where witnesses estimated annual losses to the federal government could reach $1 trillion.
The hearing opened with Chairman Hawley detailing a "fraud epidemic" in Minnesota, alleging that $9 billion had been defrauded from Medicaid alone under the administration of Governor Tim Walz. Hawley cited reports of $700 million in physical cash being transported in suitcases out of Minneapolis-St. Paul International Airport to overseas destinations. Ranking Member Andy Kim (D-NJ) agreed that fraud is a critical issue requiring bipartisan solutions but cautioned against using fraud investigations as a pretext to target political opponents or delegitimize constitutional rights to protest, specifically referencing recent tensions following the deaths of American citizens during federal law enforcement actions.
Key Testimony
Mark Koran, a Minnesota State Senator and member of the Legislative Audit Commission, provided testimony on the collapse of oversight in his state. He alleged that state employees had backdated documents to mislead auditors and that the Walz administration had ignored repeated warnings about "Feeding Our Future," a program where hundreds of millions of dollars intended for hungry children were stolen. Koran emphasized that the fraud was not merely a result of incompetence but potentially "willful complicity," noting that the state’s reliance on "self-attestation"—allowing applicants to verify their own eligibility without documentation—made programs easy targets for criminal syndicates.
Partisan Dynamics
Haywood Talcove, CEO of LexisNexis Risk Solutions, provided a broader national perspective, estimating that the U.S. loses approximately $115 million every hour to fraud. He argued that 70 percent of these funds flow to transnational criminal organizations and foreign adversaries like China, Russia, and Iran, eventually funding terrorism and human trafficking. Talcove identified "self-attestation" as the primary vulnerability and proposed a four-point solution: front-end identity verification, mandatory recertification of all recipients, independent third-party audits, and increased involvement of federal law enforcement agencies like the U.S. Secret Service.
Key Testimony
The hearing also explored the intersection of government benefits and political instability. Seamus Bruner, Vice President of the Government Accountability Institute, testified about a "pipeline" he categorized as "Migrant Inc., Election Inc., and Riot Inc." Bruner alleged that a network of NGOs facilitates mass migration to secure government benefits, which then creates a dependency used for political mobilization. He specifically named Neville Roy Singham, an American citizen living in China with alleged ties to the Chinese Communist Party (CCP), and Swiss billionaire Hansjörg Wyss as major funders of "dark money" networks like Arabella Advisors and the Tides Foundation. Bruner claimed these networks fund "Riot Inc.," providing logistics and legal support for anti-ICE protests in Minnesota and elsewhere to raise the political cost of law enforcement.
Overview
In contrast, Dylan Hedtler-Gaudette, Acting Vice President of Policy and Government Affairs at the Project On Government Oversight (POGO), argued that fraud is a systemic "cancer" not limited to any one state or party. He defended the Government Accountability Office (GAO) and Inspectors General (IGs), criticizing recent proposals to cut their budgets or dismiss their leadership. Hedtler-Gaudette also dismissed the "Department of Government Efficiency" (DOGE) as a "foolhardy" endeavor that has failed to produce the savings it promised, suggesting instead that Congress modernize the "analog" architecture of usaspending.gov to improve transparency.
Several policy proposals were discussed during the session. Sen. Rick Scott (R-FL) announced the introduction of the "SNAP Data Transparency and Oversight Act," which would require states to provide recipient data to the USDA to prevent fraud. Sen. Bernie Moreno (R-OH) discussed his "STOP Act," which would prohibit individuals receiving federal social welfare benefits from sending remittances outside the United States. Sen. Moreno argued that states should be held financially liable for federal funds lost to fraud under their watch, suggesting the federal government issue "IOUs" to states like Minnesota to recoup losses.
Partisan dynamics were sharp throughout the hearing. Republican members, including Sen. Ron Johnson (R-WI), focused on the role of NGOs and foreign actors in destabilizing the country and creating a "one-party state" through migration and benefit dependency. Johnson highlighted a St. Louis Federal Reserve report estimating that NGOs hold $14.1 trillion in assets, questioning how much of that originated as taxpayer funds. Democratic members, led by Sen. Kim, emphasized that while fraud is a national security issue, the rhetoric used by the majority risked "throwing gasoline on the fire" during a period of high social tension and distrust in government.
Notable exchanges included Chairman Hawley’s visualization of the fraud scale, noting that $700 million in cash equates to "14,000 pounds of $100 bills" leaving the country. Sen. Moreno used a personal analogy, asking witnesses if they would "hunt someone down like a wild animal" if they were personally robbed of $4,000—the estimated per-taxpayer cost of annual fraud.
Key Testimony
The hearing concluded with Chairman Hawley calling for the Department of Justice to launch criminal prosecutions against the dark money groups and criminal syndicates identified in the testimony. He announced that the subcommittee record would remain open for 15 days, until February 25, 2026, for additional statements and questions.
Transcript
[Gavel sounds.] Well, let me call to order this third hearing of the Senate Committee on Homeland Security and Governmental Affairs Subcommittee on Disaster Management, which I am delighted to work on with my colleague, Ranking Member Kim. I want to thank, say a thank you to all of our witnesses for being here, as well as everybody who is in the room and joining us online. The title of today's hearing is "Examining Fraud and Foreign Influence in State and Federal Programs." And today's hearing is going to examine two pillars that are truly fundamental to our republic and to the confidence of the American people in our republic, and that is the integrity of our public funds and the integrity of our political system. Let me just start with the second one. As early as the Constitutional Convention, Alexander Hamilton warned that foreign powers would try to exploit America's freedoms to sow divisions inside our country. Threats from foreign influence, he said, should never be dismissed as idle or as hypothetical. And today, we are confronting a raft of allegations and reports that foreign influence and foreign money is making its way into the American political system and is financing activities that is not only destructive, detrimental, and divisive, but also potentially illegal. At the same time, more and more Americans are rightly concerned about the use of their tax dollars and where their tax money is being spent around the country. You know, I've often thought, watching and reading reports here in recent months, that if you are a hardworking American taxpayer, if you're somebody who wakes up every morning, goes to your job, plays by the rules, pays your taxes, you must feel like such an idiot. I mean, you must feel so taken advantage of because here we have reports, credible reports, and we're going to hear more about it today with some substantiation of billions of dollars of taxpayer money, your money, your tax funds being taken and spent on illicit activities, on foreign overseas activities, on other illegal and criminal activities. It's absolutely outrageous, and it's time that we got accountability for how Americans' hard-earned tax dollars are being spent and how the integrity of our political system is being protected. We're going to hear testimony that tens of billions of dollars intended to serve the public have been lost to fraud in the state of Minnesota alone. Organized criminal syndicates stole COVID-era disaster money to the tune of billions of dollars, and since then, they have defrauded money from every single federally funded program in the state of Minnesota. Let me say that again: every single federally funded program in the state of Minnesota. Programs intended for children, for the elderly, for the poor, for the sick, for the most vulnerable Americans. We're going to hear testimony that $9 billion has been defrauded in Minnesota from Medicaid alone. $9 billion vanishing into luxury cars, overseas vacations, billions going to fund foreign adversaries, billions shipped out of the country. In the last two years alone, get this now, nearly $700 million in cold hard cash was stuffed into suitcases and flown out of Minneapolis. $700 million. That is 14,000 pounds of $100 bills in suitcases flown out of our country overseas. We're going to hear testimony that American taxpayers nationwide are losing north of a trillion dollars a year in government programs. That's the Pentagon's entire budget. A trillion dollars a year. This isn't isolated cooks gaming the system. I wish it were. It's transnational criminal syndicates siphoning money out of America. 70 percent of that loot flows overseas, funding cartels, terrorists, adversaries like North Korea, China, Iran, Russia. Money meant for American grandparents, working families, the elderly, the sick is instead funding organized crime, arming our enemies, and subsidizing the trafficking of children. And the threats don't end there. In recent weeks, we have seen anti-ICE protests escalate into outright lawlessness. What we're going to hear testimony about today is these were not spontaneous protests in many cases. It's manufactured chaos. And who is behind it? Dark money networks and foreign actors, some of whom have ties to the Chinese Communist Party. We're going to hear testimony that these activities are funded and coordinated by a dense network of nonprofits and foreign-linked actors who use layer upon layer of pass-through entities to hide the money trail. A classic dark money money laundering to take foreign money and foreign influence and to dump it into our political system. It's sort of like Riot Incorporated. Pre-planned tactics designed not to protest, but to destabilize, to erode faith in our institutions, and to force political change through manufactured crises. Listen, at the end of the day, this hearing's about a simple question: is our government equipped to safeguard taxpayer dollars, protect the rule of law, and defend our institutions from exploitation? Because right now, it sure doesn't look like it. And it's time we got some answers for the American people. With that, I'll recognize my colleague, Senator Kim.
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