The director of the Feeding Our Future nonprofit and 47 other people were charged Tuesday in what federal prosecutors say was a "massive scheme" to defraud the government of more than $250 million meant to feed needy children during the pandemic.
In a news conference, U.S. Attorney Andrew Luger described the scheme as the largest pandemic fraud in the country and said the charges amount to one of the largest federal fraud cases ever brought in Minnesota.
"These 47 defendants engaged in a brazen scheme of staggering proportions," Luger said, hours before charges against another defendant were unsealed. "Their goal was to make as much money for themselves as they could while falsely claiming to feed children during the pandemic."
The defendants were charged with crimes including wire fraud, conspiracy, money laundering and bribery. The indictments allege that conspirators shelled out tens of thousands of dollars to join the criminal enterprise, and later tried to cover their tracks by submitting fake invoices and enrollment forms with fictitious names pulled from such places as listofrandomnames.com.
Luger described the wave of indictments unsealed Tuesday as "the first set of charges" in the continuing investigation. Several defendants were arrested Tuesday, but Luger said some have left the country.
Prosecutors contend that the leader of the scheme was Aimee Bock, executive director of Feeding Our Future, whom they accuse of personally recruiting many of the conspirators and knowingly submitting more than 125 million false meal claims.
Bock appeared in court Tuesday afternoon and pleaded not guilty. She was released with conditions.
"The indictment is the beginning of the criminal process," Bock's attorney, Kenneth Udoibok, said in a written statement. "There's relief in the allegations against my client because we now know the government's position. The indictment is not evidence of guilt or innocence. I'm surprised that my client has been indicted because she did not commit any crimes."
Co-conspirators are accused of using tens of millions of dollars to fund international travel, buy luxury cars and purchase homes in Minnesota, Ohio, Kentucky and along the coasts of Kenya and Turkey.
Tuesday's arrests mark the latest high-profile chapter in a federal probe that started more than a year ago and included a sweeping FBI search warrant operation in January that spilled into public view.
According to charges, the alleged scheme exploited changes in the federal child nutrition program that were intended to make sure needy children received adequate nutrition amid the pandemic.
As part of the changes, the U.S. Department of Agriculture allowed for-profit restaurants to participate in the federal food aid program. Regulators also let parents bring meals home instead of requiring children to eat on site. Prosecutors said the rule changes made it more difficult to oversee the meals program, rendering it vulnerable to fraud and abuse.
After becoming an approved sponsor in 2018, Feeding Our Future battled state regulators over its explosive growth plans, filing a lawsuit that ultimately forced the department to approve dozens of sites that had been held up in the approval process for months.
Luger said the conspiracy began in March 2020, in the early days of the pandemic, when the conspirators saw an opportunity to defraud the government.
As part of a "pay-to-play" scheme, Bock and other company employees solicited and received bribes from people and companies seeking to join the fast-growing criminal enterprise, according to the charges.
Many of the bribes were paid directly to Abdikerm Abdelahi Eidleh, a Feeding Our Future employee who was accused of receiving kickbacks ranging from $49,000 to $225,000, the charges say. Eidleh could not be reached for comment and court records indicate he does not have an attorney yet.
Eidleh is accused of depositing more than $5 million in kickbacks, bribes and other fraud proceeds into bank accounts opened in the name of his shell companies.
Many of the kickbacks were paid in cash or disguised as "consulting fees" paid to shell companies created by Feeding Our Future employees to conceal the true nature of the payments and make them appear legitimate, the indictment alleges.
Bock benefitted from the expanding fees collected by Feeding Our Future, which typically kept 10% to 15% of all reimbursement payments for administrative purposes, according to the charges. In 2021, when Feeding Our Future collected nearly $200 million in reimbursements, its share of the money amounted to $18 million, the charges say.
The indictment says Feeding Our Future also opened its own federal food aid sites in Minneapolis and Burnsville that falsely claimed to serve meals to thousands of children a day, seven days a week.
Altogether, Bock's nonprofit sponsored more than 200 federal food program sites throughout Minnesota, according to the charges.
"The sites fraudulently claimed to be serving meals to thousands of children a day within just days or weeks of being formed and despite having few, if any, staff and little to no experience serving this volume of meals," the indictment reads.
Bock told the Star Tribune earlier this year that she never stole money or saw evidence of fraud among her subcontractors.
The scheme was so lucrative that some conspirators were able to rent out restaurants at exorbitant prices just to create additional meal sites, according to the charges. In Willmar, for instance, conspirators paid more than $570,000 to rent the Faafan Restaurant for 11 months, almost three times the restaurant's annual sales before the pandemic. The site received more than $4 million in reimbursements, half of which was pocketed by the conspirators, according to the charges.
"No one participating in this program legitimately would ever imagine they could … make millions of dollars," Luger said. "It is not possible."
Prosecutors said the conspirators did a sloppy job of concealing their crimes, submitting fake attendance rosters that were filled with hundreds of made-up names that could not be verified by local schools. Typically, Luger said, just 1% to 2% of the names appeared to be legitimate.
In some cases, conspirators consulted websites to find names. But investigators found impossible fluctuations in the ages of the students listed on the rosters, noting that some kids went from 8 to 12 years old in a matter of months.
The meal sites allegedly submitted fake invoices purporting to document their food purchases. Some did purchase and serve small amounts of food but inflated the numbers, the indictment adds.
The indictment charging Bock also includes charges against three men — Salim Ahmed Said, Abdulkadir Nur Salah and Abdirahman Mohamud Ahmed — who run the Safari Restaurant in Minneapolis. They claimed to have served 3.9 million meals to children between April 2020 and November 2021, propped up by fake attendance rosters, prosecutors contend. Said, Salah and Ahmed could not be reached for comment.
According to charges, Safari received more than $16 million in federal money based on claims that it was feeding needy children. The charges noted that the restaurant generated no more than $600,000 in annual sales prior to the pandemic.
Said and Salah sent much of the $16 million to co-conspirators via shell companies used to launder proceeds, according to the charges. Safari's ownership also paid more than $350,000 in bribes and kickbacks to Bock and Eidleh for sponsorship, the charges say.
Minnesota Department of Education (MDE) officials began questioning Bock about the sudden boom in sites that her organization sponsored in 2020. Feeding Our Future sued the state and claimed the education department was discriminating against a nonprofit that worked with racial minorities after the department halted payments to the nonprofit by early 2021. The FBI's investigation into Feeding Our Future began in May 2021, after state education officials brought information to the bureau.
Though some state legislators have faulted MDE for not acting more aggressively on its fraud suspicions, Luger declined to assess the department's oversight.
"That is not for me to say," Luger said. "We are pleased by the thorough cooperation we got from MDE throughout this investigation."
Feeding Our Future's three board members voted in February to dissolve the organization in part because its bank accounts had been frozen by the federal probe.
According to court documents, the government has seized more than $3.5 million from a Feeding Our Future bank account and more than $185,000 held in Bock's personal bank accounts. Authorities also took $13,462 in cash and a 2013 Porsche Panamera during the Jan. 20 search warrant operation at Bock's home.
Luger said that the government has so far seized $50 million in property tied to the scheme, including 60 bank accounts, 45 parcels of real property, 14 vehicles, jewelry and other items.
At least one defendant — Fahad Nur — is accused of fleeing the United States shortly after the January FBI raids. Nur is charged with four others in one indictment that alleged a $25 million fraud scheme. Nur's The Produce LLC was sponsored by Feeding Our Future and took in more than $11 million in federal funds as a vendor and food supplier to sites involved in the program. Nur could not be reached for comment.
Prosecutors say he did not make any significant food-related purchases between initiating food operations around March 2021 through September of that year, yet received $3.5 million for food he claimed to have provided through the program. Days before registering the company with the state of Minnesota, Nur submitted fraudulent invoices to Feeding Our Future claiming to have provided 3,635 gallons of milk and more than 7,000 packed lunches to another co-defendant, the indictment says.
Most defendants did not yet have an attorney.
Others charged include:
• Abdiaziz Shafii Farah and Mohamed Jama Ismail, co-owners of Empire Cuisine and Market LLC in Shakopee, and who along with others opened more than 30 federal food aid sites around the state. The two are part of an eight-person indictment alleging a $40 million fraud scheme. Farah's attorney, Andrew Birrell, said in a statement Tuesday: "We have been conducting our own parallel investigation since the execution of the search warrants in January. We are grateful the matter is now before the Court and there can be a public presentation of Mr. Farah's side of the story to a federal jury. Rather than simply an indictment which is the product of a one sided presentation in secret by the government which reaches erroneous conclusions." Ismail could not be reached for comment.
• Liban Yasin Alishire, president and owner of Community Enhancement Services Inc., located in the JigJiga Business Center in Minneapolis. Alishire helped run Lake Street Kitchen LLC with Khadar Jigre Adan and Ahmed Yasin Ali. Alishire couldn't be reached for comment.
• Qamar Ahmed Hassan, owner and operator of S & S Catering Inc. in Minneapolis. Hassan and seven others are charged in an indictment outlining a $17.4 million fraud scheme. Hassan pleaded not guilty at a court appearance Tuesday. Her attorney could not be reached for comment.
• Sharmake Jama and Ayan Jama, who were the principals of Brava Restaurant & Café LLC in Rochester. They are charged in a six-person indictment with running a $5.6 million scheme. They couldn't be reached for comment.
• Haji Osman Salad, who operated Haji's Kitchen LLC in Brooklyn Park. He and four others are charged with carrying out a $25 million fraud conspiracy. Neither Salad nor his attorney could be reached Tuesday for comment.
Staff writer Kelly Smith contributed to this report.