The Department of Health and Human Services announced Tuesday that it was suspending all child-care payments for Minnesota over allegations that the state has allowed taxpayer dollars to go to fraudulent daycare centers statewide.

The order impacts the HHS' Administration for Children and Families payments, and requests Minnesota Gov. Tim Walz (D) approve comprehensive audits on the allegedly fraudulent daycare centers the department has identified.

Minnesota has also been accused of allowing widespread fraud schemes to infiltrate other publicly funded programs, such as the Supplemental Nutritional Assistance Program, and steal millions of taxpayer dollars.

"You have probably read the serious allegations that the state of Minnesota has funneled millions of taxpayer dollars to fraudulent daycares across Minnesota over the past decade," Deputy HHS Secretary Jim O'Neill said on X. "Today we have taken three actions against the blatant fraud that appears to be rampant in Minnesota and across the country."

O'Neill said the department has implemented new screening for all ACF payments, which now require justification and a receipt or photo evidence before money is sent to a state. It has also launched a dedicated fraud-reporting hotline and email address that can be found here. 

The move comes a day after the Small Business Administration said it was pausing its annual funding to Minnesota while it investigates alleged fraud in the COVID-era Payment Protection Program. 

Misty Severi is a news reporter for Just The News. You can follow her on X for more coverage.