On January 9, the U.S. Treasury announced a series of measures aimed at addressing alleged widespread government benefits fraud in Minnesota, purporting that billions of taxpayer dollars were lost to what the Treasury deemed “complex fraud rings.” As part of these efforts, FinCEN issued a Geographic Targeting Order requiring banks and money transmitters in the Minnesota counties of Hennepin and Ramsey to report certain international transactions of $3,000 or more. FinCEN also issued an alert urging financial institutions to identify and report suspected fraud involving federal child nutrition programs, with a particular focus on Minnesota. The alert instructs financial institutions filing suspicious activity reports (SARs) to reference the alert in field two and in the narrative using the key term “FIN-2026-MNFRAUD,” select SAR field “34(z) (Fraud – Other),” and include “Federal Child Nutrition Programs” in the text box.
The Treasury’s announcement also noted that FinCEN issued investigative notices to four Minnesota-based money services businesses and that the Treasury directed the IRS to audit financial institutions linked to the movement of state funds, as well as to establish a task force to investigate possible misuse of pandemic-era tax incentives and nonprofit status.
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