President Donald Trump’s administration on Tuesday warned the state of Mississippi that it could still face stiff penalties for misspending millions of welfare dollars.
The U.S. Department of Health and Human Services last year rescinded the $100 million penalty, which was originally imposed by former President Joe Biden’s administration, after the state said it could justify some of the allegedly fraudulent spending in the Temporary Assistance for Needy Families program.
In a letter sent Tuesday, the Administration for Children and Families at HHS, which administers the program, serves as a reminder that Mississippi could still face a substantial penalty. It’s likely also an effort to show the administration isn’t giving favorable treatment to a Republican-led state while it cracks down on alleged fraud in blue states.
“As noted previously, the misuse of federal TANF funds is a very serious concern to ACF and the federal government in general,” ACF’s Deborah List wrote to the Mississippi Department of Human Services in the letter, which was obtained by HuffPost. “Although the December 2024 penalty notice was rescinded for the limited purposes described above, MDHS will be subject to a future penalty based on ACF’s assessment of the amount of TANF funds that were misused.”
As HuffPost reported earlier this month, the Trump administration had seemingly left Mississippi off the hook for a massive welfare fraud scandal as it cracked down aggressively on Democratic states. The administration has flooded Minnesota with militarized immigration agents and announced an unprecedented suspension of TANF and other federal programs in Minnesota, plus four other Democratic-led states, in response to fraud in Minnesota.
Nick Gwyn, an expert on the federal government’s social safety net programs with the liberal Center on Budget and Policy Priorities, said the back-and-forth between Mississippi and the administration is still much friendlier than the approach taken with Democratic states.
“The ACF letter highlights the existing regulatory process to address fraud in the TANF program — which the Trump Administration ignored and violated in their five-state funding freeze,” Gwyn said in an email. “The result is allowing one state more than a year to contest a penalty based on documented fraud, while five states were threatened with immediate withholding of their TANF funds, without any evidence of misspending.”
The HHS letter asks Mississippi for an update on its efforts to substantiate the nearly $100 million in payments to nonprofit organizations that then funneled the money to not-so-needy individuals, including former NFL quarterback Brett Favre. (Favre has said he had no idea the funds he received, which he has paid back to the state, were intended help low-income families.)
Federal prosecutors in Minnesota have filed charges against nearly 100 people, most of them of Somali descent, for embezzling $250 million in federal nutrition funds without providing meals to low-income individuals since 2022. The Trump administration surged immigration agents to the state this month in response to a viral YouTube video purporting to show fraudulent day cares with no children inside.
In a lawsuit seeking to stop the federal government’s surge of federal law enforcement in Minnesota, which has terrorized residents and resulted in the deaths of two American citizens, the state government argued fraud was a mere pretext for an attack on Democrats.
“Defendants claim this unprecedented surge of immigration agents is necessary to fight fraud,” the state said in a court filing this month. “In reality, the massive deployment of armed agents to Minnesota bears no connection to that stated objective and instead reflects an alarming escalation of the Trump Administration’s retaliatory actions towards the state.”