A report published Monday by an appointee of Gov. Tim Walz to oversee program integrity found that state agencies have been repeatedly warned about vulnerabilities in state-run social services going back to at least the 1970s.

Tim O’Malley, who was designated the state’s Director of Program Integrity in December, said in a press briefing that the state has “long-standing vulnerabilities” that people have used to defraud state programs.

The 57-page report, titled “Roadmap to Program Integrity and Fraud Prevention,” includes a long list of recommendations, including for a “skilled independent monitor” who has “subject matter expertise and the requisite gravitas to drive home accountability.”

O’Malley, a veteran of the FBI and the Minnesota Bureau of Criminal Apprehension, didn’t explicitly answer a question about whether the monitor should be appointed by the governor, though he said that being appointed by Walz hasn’t influenced his own work. A legislative effort to establish an independent Office of Inspector General got broad bipartisan support in the Minnesota Senate in the 2025 legislative session, stalled in the House but has now been revived this year. 

The report comes days after the start of the 2026 legislative session, with fraud a central issue, though a closely divided Legislature and election year politics will make passing major legislation a challenge. O’Malley included recommendations for legislation in his report, including requiring fraud-prevention funding for every bill.

Another state-commissioned report published Feb. 6 in a separate anti-fraud effort included a list of policy recommendations that were completely redacted in public files; lawmakers Monday said in committee hearings that they still haven’t received the unredacted policy recommendations.

The new program integrity role is just one effort by the Walz administration to get a handle on fraud, waste and abuse in Minnesota’s social services, which has turned into a yearslong political scandal that began with revelations that hundreds of millions of dollars were stolen from a pandemic-era food aid program.

O’Malley said that his review found that the root of the state’s vulnerabilities to fraud goes back much farther.

“Problems that are a half-century in the making will not be solved easily,” O’Malley said.

The report includes a slew of warnings from audits and reports over the past 50 years. The earliest is a warning to the Department of Human Services from Feb. 17, 1977: “Regardless of a rule’s precision or stringency, the level of care available in facilities will not consistently meet requirements unless an active enforcement program exists.”

O’Malley said that plans were repeatedly put in place to strengthen the state’s protections against fraud and inefficiency, but they weren’t executed well. Services called out in warnings over the past several decades have drawn new scrutiny today for their vulnerability to fraud: group homes, child care assistance, personal care assistance and medical transportation.

Despite reviewing the state’s repeated failures to adequately address vulnerabilities, O’Malley said he has no doubt that “this can be fixed” given enough effort.

O’Malley also credited the state’s vulnerability to fraud on the culture of state agencies overseeing social services, which he said focused more on “compassion than compliance.”

The written report said that former Department of Human Services leaders have said that the agency should be “guided by 70% compassion and 30% compliance.” O’Malley called that mentality “misplaced” though understandable, since people working in social services want to care for the vulnerable.

The report also includes references to supervisors retaliating against state workers for raising concerns around fraud, among a list of violations by state employees, in line with whistleblower reports frequently referenced by Republican legislators in hearings.

The Walz administration has faced enormous criticism for yearslong complacency despite numerous red flags. O’Malley’s report indicates that the conditions for the current fraud scandal were laid out over time, with preventative measures “incrementally … not done literally for half a century,” he said.

O’Malley, a former superintendent of the BCA under Republican Gov. Tim Pawlenty, said that Walz has not interfered with his work. He told reporters that with the report finished, he’s “happy to continue advising” state officials, though he wouldn’t want to be the appointed independent monitor: “I have other things I’d like to do with my time.”

The Trump administration has repeatedly singled out Minnesota for fraud in its social services and sent 3,000 federal immigration agents to the state in an unprecedented immigration enforcement surge, citing fraud as a rationale. O’Malley described fraud in Minnesota as being “well-documented” and “extensive,” though he added that he doesn’t know whether the state’s fraud is disproportionate compared to other states and said that fraud is “a national problem.”

About the author

Alyssa Chen is a Reformer data reporter with a focus on health care policy.