Minnesota Republicans Call for Governor Walz’s Resignation Following $9 Billion Fraud Allegations
St. Paul, Tuesday, 30 December 2025.
GOP legislators demand Governor Walz’s resignation, citing “nonfeasance” after allegations surfaced that fraud within Minnesota’s public programs may have reached a staggering $9 billion.
Escalation from Federal Scrutiny to State Crisis
The scrutiny surrounding Minnesota’s financial management has intensified sharply following reports that the FBI has surged resources to uncover an alleged “iceberg” of financial fraud. While federal law enforcement focuses on criminal culpability, the political fallout reached a critical juncture on Monday, December 29, 2025, when Minnesota House and Senate Republicans outlined specific demands for the administration, building upon a formal call for Governor Tim Walz’s resignation issued earlier in the week [3]. This legislative maneuver marks a significant pivot from external investigation to internal accountability, driven by allegations that fraud within state services—specifically Medicaid and child care programs—may have cost taxpayers as much as $9 billion [1][4].
Allegations of Nonfeasance
Leading the charge are State Senators Bill Lieske and Nathan Wesenberg, alongside State Representatives Marj Fogelman, Drew Roach, and Mike Wiener, who issued a joint statement citing Article 8, Section 6 of the Minnesota Constitution [2]. The coalition argues that Governor Walz’s failure to stem systemic fraud constitutes “nonfeasance”—a failure to perform required duties—rather than simple mismanagement [2]. While the legislators clarified they are not currently launching a recall effort, they contend that the governor had a fiduciary duty to oversee his administration and protect these programs, a duty they claim he failed to uphold as the crisis spiraled [2][3]. The lawmakers emphasized that this is the primary issue raised by constituents, stating, “Minnesotans have been watching the fraud crisis get worse and worse for years” [2][4].
The Scope of the Financial Hemorrhage
The scale of the alleged financial mismanagement is staggering. While Governor Walz previously acknowledged in the summer of 2025 that fraud across programs could total $1 billion, federal prosecutors and GOP leaders now suggest the figure is significantly higher [1]. First Assistant U.S. Attorney Joe Thompson indicated earlier in December 2025 that potentially over half of the $18 billion in Medicaid waiver programs could be fraudulent [3]. This aligns with FBI Director Kash Patel’s recent warning that previous arrests were merely the “tip of a very large iceberg” [1]. Compounding the pressure, a viral video by journalist Nick Shirley, viewed over 100 million times, recently exposed suspected fraudulent daycare locations, reportedly uncovering over $100 million in fraud within that sector alone [3][4].
Demands for Immediate Action and Oversight
On Monday, December 29, 2025, the Minnesota GOP, led by House Speaker Lisa Demuth, formalized their pressure by outlining six specific steps they require the Walz administration to take [3]. These demands include the immediate release of fraud-related documents and inspection records, a redirection of resources, and a review of funds directed to Non-Government Organizations [3]. Speaker Demuth characterized the situation as a direct result of taxpayer frustration, noting that the caucus has been working to expose these vulnerabilities for years [3]. Simultaneously, Department of Homeland Security Secretary Krisi Noem confirmed that federal agents are conducting a “massive investigation” into childcare and other rampant fraud in Minneapolis, reinforcing the state legislators’ claims with federal weight [1].
Administration’s Defense and Political Implications
In response to the growing fervor, Governor Walz’s office has maintained that the administration has been actively working to crack down on fraud for years [1]. A spokesperson highlighted recent corrective measures, including hiring an outside firm to audit payments, shutting down the Housing Stabilization Services program, and appointing a new statewide program integrity director [3][4]. The Governor’s office also noted that Walz has requested more authority from the state Legislature to take aggressive action and has supported criminal prosecutions [1][3]. However, political analysts suggest the damage may already be done; David Schultz, a professor of political science at Hamline University, noted that the reputational hit to Governor Walz will likely define his potential run for a third term in 2026 [1].