A state regulator testified Tuesday in the first trial of Feeding Our Future that it was involved in fraud in government child nutrition systems after seeing a large increase in meal reimbursement claims during the COVID-19 pandemic.
Seven other people allegedly connected to the small Shakopee restaurant, Empire Cuisine and Market, are accused of stealing $47 million as part of what the U. S. Attorney’s Office in Minnesota says is a much larger plot to defraud federal food systems for young people in need.
Emily Honer, who oversees statewide systems at the Minnesota Department of Education, said that before COVID, a daycare could serve food to a hundred or two hundred young people a day. When the federal government allowed restaurants to participate, Honer said Empire’s owners introduced programs to serve 2,000 young people a day, an “incredibly high number” that set off red flags.
Responding to questions from Assistant U. S. Attorney Joseph Thompson, Honer said the U. S. Department of Agriculture is not in charge of the U. S. Department of Agriculture. The U. S. Food and Drug Administration, which runs summer food service and food programs for child and adult care, gave up on covering key needs during the pandemic to ensure young people continued to get meals.
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Because daycare centers, YMCAs, and other eating places were closed, the USDA suspended the requirement that children eat together in “congregate” places. The branch has also made it possible for parents to pick up food in bulk.
Honer said Partners in Nutrition, a nonprofit that sponsors eating places, asked the MDE in early 2020 if dining places could simply participate in the summer food service program. After consulting with the USDA’s regional office, Honer told nonprofit officials that dining venues were allowed to participate.
“It wouldn’t have been allowed before COVID because a site needed to be operational primarily for childcare,” Honer said.
In the summer of 2020, Honer testified that she was involved in the huge number of requests for food and beverage sites by restaurants. After checking the Minnesota Secretary of State’s business registration website, Honer said he learned that many restaurants, including Empire Cuisine, had just opened.
“Our questions were: Is this site open? Can this site serve the many young people you’ve implemented it for?” said Honer.
She said the new eating places began to generate uneasy bills for the food they claimed to have served, and that the amount of food and dollar amounts were unusually high.
“The claims were either the maximum amount of food claimed or incredibly high amounts that generated federal reimbursements. “
Honer noted that before the pandemic, Feeding Our Future was asking for refunds of about $40,000 at a time. But in the fall of 2020, the organization requested invoices of $1 million each before requesting a one-time payment of $8 million in December. for a week’s worth of meals.
By comparison, Honer said, public schools in Minneapolis, one of the state’s largest districts, earned $17 million in federal reimbursement for the food they served to youth in 2020.
Honer testified that when she and her team couldn’t get “reasonable answers” from Feeding Our Future and Partners in Nutrition, they contacted the USDA inspector general.
After the USDA told the MDE that restaurants were not complying with the program’s rules, Honer said the MDE stopped allowing restaurants to participate as food service sites.
But that didn’t stop the MDE taxpayers’ money from going to Empire Cuisine. Honer said the company continues to file refund requests not as a place to eat, but as a food vendor for other sites. He claimed that the amount of Empire’s claims higher each month.
Honer said he continues considerations with the leadership of the MOU and USDA, and in early 2021 signed notifications to Feeding Our Future and Partners in Nutrition that they had a “serious gap” in program compliance. He also contacted the FBI.
Honer said he also passed orders to suspend bills for Feeding Our Future, but in 2021, amid a lawsuit filed through Feeding Our Future against the MDE, a Ramsey County ruling told the company it didn’t have the authority to block bills.
Defense attorneys say their clients operated valid businesses and followed the program’s regulations.
On cross-examination of the suggested Frederick Goetz, representing the defendant Mukhtar M. Shariff, Honer admitted that the USDA has also waived many compliance requirements, such as follow-up, in favor of “document audit” reviews of foods and their sponsors. . ‘ Administrative procedures.
Despite the considerations he expressed to his superiors, the USDA and the FBI, Honer admitted that he never conducted a table audit. He also said the MOU approved a food site application and reimbursements for food purchases through the ThinkTechAct Foundation, which claimed to serve food. several thousand young people every day at a mosque in Bloomington.
Prosecutors say the defendants used the base as a means to launder money, but Honer admitted that his company paid the claims by reviewing the underlying documents.