Treasury Fraud Probe Seeks Info From Minnesota Money Transmitters

As part of this effort, the department’s Financial Crimes Enforcement Network (FinCEN) has notified some businesses that they are under investigation for fraud centered around COVID-era tax incentives, U.S. Treasury Secretary Scott Bessent announced Friday (Jan. 9).

“Complex fraud rings in Minnesota have stolen billions of dollars from state programs for their personal enrichment in the United States and abroad,” the department said in a news release.

The release added that FinCEN has issued a Geographic Targeting Order that requires banks and money transmitters located in Hennepin and Ramsey counties, which include Minneapolis and St. Paul, to report additional information about funds sent outside the U.S. These businesses will be required to report transactions of $3,000 or more where the beneficiary is based outside of the United States.

Speaking during a news conference, Bessent reportedly declined to name the businesses in question. He said the goal was to stop an alleged social welfare fraud scheme in Minnesota the government says may have diverted funds to Somalia’s Al-Shabaab terrorist group.

“We have traced where the money went and are examining it,” Bessent said during a virtual news conference after meeting with several Minnesota financial institutions, per Reuters.

The effort comes as the U.S. government is increasing its presence in Minnesota, with thousands of Immigration and Customs Enforcement (ICE) personnel conducting enforcement operations in Minneapolis. Tensions in the city reached a flashpoint last week when an ICE officer shot and killed Renee Good.

A report by CBS News includes comments from Minnesota Attorney General Keith Ellison’s office, which said it “categorically rejects the premise that the ‘underlying reason’ Trump has ordered the outsized presence of ICE in Minnesota is because of fraud,” and added “Ellison does have extensive experience in successfully fighting fraud.”

Meanwhile, the recent PYMNTS Intelligence report “2025 State of Fraud and Financial Crime in the United States,” commissioned by Block, found that financial institutions are coming to terms with the fact that fraud is a “networked phenomenon,” as covered here last week.

Criminal groups, that report said, share tools, mule accounts, compromised credentials and customer service scripts. 

“They test defenses collaboratively, iterating on what works and abandoning what does not. In many cases, the same infrastructure is used to target multiple firms across industries,” PYMNTS wrote. “This reality undermines the assumption that fraud can be contained within organizational boundaries. A weakness in one company can become an entry point into an entire sector.”