Rep. Jason Smith told Newsmax that a Hennepin County small‑business relief program has exposed serious fraud concerns after officials flagged more than two‑thirds of about 300 applications. The county approved $2 million to help businesses affected by Operation Metro Surge; about 80 applicants received roughly $500,000 before the program was paused. Smith said his committee has uncovered large-scale pandemic unemployment and Medicare fraud and urged extending the statute of limitations for COVID‑era unemployment fraud prosecutions from five to ten years.
Rep. Jason Smith Says Minnesota Small-Business Relief Program Exposed 'Widespread' Fraud Concerns
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Rep. Jason Smith (R‑Mo.) told Newsmax that he believes Minnesota has become a "haven for fraud" after Hennepin County paused a $2 million small‑business relief program that officials set up for firms affected by federal immigration enforcement.
Program, Applications and County Response
In March, Hennepin County commissioners approved $2 million to cover two months of rent or commercial mortgage payments for small businesses they said were affected by Operation Metro Surge. The county received roughly 300 applications; local reporting indicates more than 200 were flagged for potential fraud. About 80 applicants received funds — an estimated $500,000 total — before the county halted the program. County officials say no money has been confirmed lost to fraud and that the sheriff's office has been asked to review the applications and disbursements.
Smith's Comments and Broader Oversight Claims
"It's just hard to believe that Minnesota has become such a great environment for fraud," Smith said on Newsmax's National Report. He added that investigators have uncovered "over $1 billion in fraud... just in the last year."
Smith, who chairs the House Ways and Means Committee, framed the Hennepin County case as part of larger oversight efforts. He said committee investigators have identified between $300 billion and $400 billion in pandemic‑era unemployment fraud and cited estimates of roughly $60 billion a year in Medicare fraud. He pointed to anecdotal examples from investigations — including instances where a burrito stand was listed as the headquarters of a hospice provider and where a tire shop was registered as a hospice center.
Legislative Response
Smith urged extending the statute of limitations for prosecuting pandemic unemployment fraud, calling it a comparatively simple step to help recover alleged losses. The House has passed the Pandemic Unemployment Fraud Enforcement Act, which would extend the federal deadline for prosecuting fraud in pandemic unemployment programs from five years to ten.
Context
Operation Metro Surge, an immigration enforcement initiative that began Dec. 1, 2025, prompted protests and heightened scrutiny after federal agents fatally shot two U.S. citizens in Minneapolis in January. Local officials say the aid program was intended to help businesses directly affected by increased enforcement activity.
What Comes Next
Hennepin County has paused the relief program pending the sheriff's review. Smith and other members of Congress continue oversight efforts into pandemic‑era and other federal program fraud, while county officials review flagged applications and internal controls.
Note: Figures cited in this report reflect statements by Rep. Jason Smith and local officials as reported by Newsmax and FOX 9. Some amounts were described as estimates or flagged as potential fraud and may be subject to change pending investigation.
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