A 43-year-old Brooklyn Park man on Tuesday became the sixth person to plead guilty in the $250 million federal child nutrition fraud case connected to the Minneapolis nonprofit Feeding Our Future.
Liban Yasin Alishire admitted in a Minneapolis federal courtroom to pocketing more than $700,000 as part of a conspiracy in which he and others grossly overstated how many underprivileged children his Community Enhancement Services and Lake Street Kitchen sites served under the Federal Child Nutrition Program from late 2020 to early 2022 while under the sponsorship of Feeding Our Future.
Alishire pleaded guilty to conspiracy to commit wire fraud and money laundering. He is one of 50 people to be charged in the massive fraud case since last September.
"He realizes he made a terrible mistake," attorney Matthew Forsgren said after Alishire's plea hearing. "Obviously he accepts responsibility; he knows it."
Alishire's plea agreement calculated an expected sentencing guidelines range of 41 to 51 months, but U.S. District Judge Nancy Brasel reminded Alishire that she was not bound by that agreement and could impose a different sentence after further review of his pre-sentencing investigation.
According to Alishire's plea agreement, he submitted fake invoices and attendance rosters to prop up bogus claims that his federal child nutrition sites were serving meals to thousands of children daily. Community Enhancement Services claimed to have served more than 70,000 meals from December 2020 to April 2021. Alishire meanwhile created a distribution company called Ace Distribution Services Inc., which falsely claimed to have served more than 800,000 meals to children from February to October 2021.
"But in reality Community Enhancement Services and Lake Street Kitchen served a small fraction of the meal counts that were claimed, correct?" Assistant U.S. Attorney Joseph Teirab asked Alishire during Tuesday's hearing.
"Correct, yes," Alishire responded.
Alishire fraudulently claimed more than $2.4 million in child nutrition funds, and Feeding Our Future paid out more than $1.7 million to him and his co-conspirators. More than $700,000 of that total went to Alishire, he admitted Tuesday.
Alishire said he used another shell company, called Hoodo Properties, to launder proceeds from the fraud scheme. In November 2021, he said, he conducted a wire transfer of $216,300 toward the purchase of the Karibu Palms Resort in Diani Beach, Kenya.
Under Alishire's plea agreement, he also agreed to pay $712,084 in restitution and give up a sports boat, bunk trailer, a 2018 Ford F-150 truck, an apartment property in Nairobi, Kenya, and the beach resort he purchased.
Forsgren said Alishire was "focusing on what he did wrong" and "not trying to reduce his sentence by cooperating or providing information to others."
"He's really just focusing on his crime and trying to go forward," he said.
Alishire told Brasel in court that he was aware that his actions at the time were illegal. After accepting his guilty plea, the judge said she would set a sentencing date later.
Alishire is also one of 14 people indicted in the case who also managed one of 11 day-care centers to have received at least $22 million from the state Department of Human Services (DHS) in the past five years, according to a Star Tribune review of secretary of state filings and DHS payment records.
Alishire was CEO of a separate company called Lakes Adult Day Care on East Lake Street in Minneapolis, corporate records show. In January, the records show, the DHS informed Alishire that Lakes' license was being put on conditional status for two years after inspectors documented 13 violations.
Since 2018, Lakes received nearly $5 million in public funding from the DHS, more than any of the 11 centers identified by the Star Tribune. In a written response to questions, Forsgren told the Star Tribune that Alishire is no longer an owner of Lakes Adult Day Care, noting that Alishire "divested himself" from the corporation before the indictment against him in the meals case was unsealed in September.
Star Tribune staff writer Jeffrey Meitrodt contributed to this report.