Politics
Real, fake or overblown? Sorting fact from fiction in fraud allegations surrounding Newsom, California
SACRAMENTO — The year opened with President Trump declaring that “the fraud investigation of California has begun,” a move that quickly set off a barrage of allegations from his administration and Republican allies questioning the integrity of state programs and the leadership of Gov. Gavin Newsom.
The accusations, amplified across social media and conservative outlets, have pushed California and its Democratic leadership to the center of a broader national political fight over waste, fraud and abuse.
Newsom has dismissed the claims as politically driven, arguing that the administration is singling out Democratic-led states while ignoring similar problems elsewhere. The governor also responded by highlighting fraud cases in Republican-led states and by criticizing Trump’s own record and business dealings.
Against that backdrop, it has become increasingly difficult to separate substantiated fraud from fabricated or recycled claims, to distinguish old findings from newly raised allegations and to determine who can credibly claim credit for uncovering wrongdoing — all amid a toxic and deeply polarized political climate.
Dan Schnur, who teaches political communications at USC and UC Berkeley, said allegations of malfeasance in California is a particularly ripe target for Republicans because Democrats have controlled the state Legislature and governor’s office for years.
Democrats hold a supermajority in both the Assembly and the Senate, meaning they hold at least two-thirds of seats in both houses, and not a single Republican has been elected to statewide office in California since 2006, when Gov. Arnold Schwarzenegger and Insurance Commissioner Steve Poizner were reelected.
“There is no shared responsibility here for Republicans,” Schnur said. “If you had a state in which Republicans were actually competitive, they would bear some responsibility for these problems.”
Audits and prosecutions show that California has experienced its share of fraud, particularly in complex programs involving emergency aid, healthcare and unemployment insurance. The state paid out billions of dollars in fraudulent unemployment claims during the COVID-19 pandemic, and the California State Auditor has issued repeated warnings about state agencies that are “at high risk for waste, fraud, abuse, or mismanagement.”
Along with recycling a barrage of years-old allegations of financial malfeasance in California and other Democratic states, the Trump administration elevated claims of child-care fraud in Minnesota last month, prompting Gov. Tim Walz to drop his reelection plans to focus on the growing political crisis in his state.
Fraud allegations are increasingly being deployed as a political weapon against Newsom, a leading Trump critic and a potential 2028 Democratic presidential contender. Politicians have always railed against government waste, fraud and abuse, but now those issues are being “weaponized into a partisan issue,” Schnur said.
For the public, it can be hard to discern the truth. Here is a look at three of the central fraud allegations — and what the evidence shows.
Child-care funding
President Trump used his social media platform, Truth Social, to accuse California of widespread fraud last month, drawing a link between his administration’s investigation into child-care spending in Minnesota and programs in the Golden State, and announcing a major federal “fraud investigation” into the state’s actions.
“California, under Governor Gavin Newscum, is more corrupt than Minnesota, if that’s possible???” wrote Trump, using a disparaging nickname for the governor.
The Trump administration then moved to freeze $10 billion in federal funding for child care in five Democrat-led states — California, New York, Colorado, Illinois and Minnesota — over “serious concerns about widespread fraud and misuse of taxpayer dollars.”
In a trio of Jan. 6 letters addressed to Newsom, the U.S. Department of Health and Human Services said it was concerned there had been “potential for extensive and systemic fraud” in child care and other social services programs that rely on federal funding, and had “reason to believe” that the state was “illicitly providing illegal aliens” with benefits.
The letters did not detail evidence to support the claims. The governor’s office dismissed the accusation as “deranged.”
A federal judge subsequently blocked the Trump administration temporarily from freezing those funds. In that ruling, U.S. District Judge Vernon Broderick said he didn’t understand why the government was making it harder for states to access child-care money before any wrongdoing had been discovered.
“It just seems like the cart before the horse,” he said.
Hospice funding
Days after Trump’s social media post about alleged corruption under Newsom’s watch, Dr. Mehmet Oz, administrator for the Centers for Medicare & Medicaid Services, and Bill Essayli, the top federal prosecutor in Los Angeles, held a joint news conference on public benefits fraud, but offered few details about the scope of their investigation.
The officials accused “foreign actors” of draining billions from public healthcare programs in California, referencing bogus hospice providers first exposed by The Times in 2020 and later investigated by California Atty. Gen. Rob Bonta.
Essayli placed the blame for bad actors squarely on Newsom, calling him “the fraud king.”
Weeks later, Oz released a video of himself walking in the Los Angeles neighborhood of Van Nuys as he questioned why dozens of alleged hospices were operating along four blocks. He blamed the “Russian Armenian Mafia” and made his remarks while pointing to an Armenian bakery, prompting accusations of racism from the Armenian community.
Newsom’s office last week hit back by highlighting state efforts to fight fraud, while pointing to a 2025 Axios story on the Trump administration’s decision to pause a federal program to crack down on bad hospice operators.
Bonta’s office said it has filed criminal charges against 109 individuals over hospice fraud-related offenses and launched dozens of civil investigations.
Newsom, speaking at a Bloomberg event Thursday in San Francisco, said the allegations have been recycled and misrepresented. Later that day, he filed a civil rights complaint against “baseless and racist allegations against Armenian Americans in California” made by Oz.
“Hospice, we’ve been after that for years and years before Oz was even on the scene,” Newsom said. “In 2021, we did a moratorium on new hospice programs, 280 we shuttered.”
The Center for Medicare & Medicaid Services said earlier this year that — in addition to California — Arizona, Nevada, Texas, Ohio and Georgia are being monitored following allegations of fraud and waste.
EDD fraud
The state’s Employment Development Department, known as EDD, reported in 2021 that approximately $20 billion was lost due to fraud, largely in the federal Pandemic Unemployment Assistance (PUA) program.
While unemployment fraud was rampant across country during the pandemic as governments rushed to provide support, California’s problems stood out.
The state itself admitted in 2021 that it failed to take precautions that had been implemented in other states, including using software to identify suspicious applications and cross-checking benefit claims against personal data on state prison inmates.
Rep. Kevin Kiley (R-Rocklin) said department mismanagement and fraud often overlap and cited EDD as a prime example.
“When there is a lack of internal controls, a lack of diligence of how funds are used, that makes it easier for those who want to take advantage of the system to profit,” Kiley said.
EDD’s own tracker said the state has recovered more than $6 billion in stolen funds and opened more than 2,300 unemployment fraud investigations since the pandemic began, leading to nearly 1,000 arrests and more than 670 convictions.
The department said it has expanded fraud enforcement through partnerships with law enforcement, new identity-verification technology and a dedicated fraud task force.
But, reports of mismanagement at EDD have continued. A recent audit also found EDD wasted $4.6 million by paying monthly service fees for more than 6,200 cellphones that went unused for at least four consecutive months between November 2020 and April 2025 — including some devices that were inactive for more than four years.
At the same time, “EDD continues to have high rates of improper [unemployed insured] payments, including fraudulent payments, and it needs to improve the customer service it provides to UI claimants,” another report found.
What’s next?
Newsom said there is a reason the Trump administration is not pointing to fraud in Republican-led states.
“This is about polarization, politicalization, weaponization,” Newsom said Thursday.
Asked what the Trump administration will discover in probing California for fraud, Newsom said investigators will find a state “taking that issue very, very seriously.”
“We absolutely are here to be a partner, to go after waste, fraud and abuse,” Newsom said.
State audits show vulnerabilities persist. The California State Auditor has repeatedly flagged Medi-Cal eligibility discrepancies that have exposed the state to billions of dollars in questionable payments, while also warning that weaknesses in information security across state agencies remain a high-risk issue.
Curtailing waste could be particularly important during the upcoming year as California and its state-funded programs head into a period of volatile fiscal uncertainty, driven largely by events in Washington and on Wall Street. Newsom’s own optimistic budget proposal projects a $3-billion state deficit for the next fiscal year despite no major new spending initiatives.
The nonpartisan Legislative Analyst’s Office warned in November that California faces a nearly $18-billion budget shortfall.
It will also be a key issue in upcoming elections. A group of Republicans running for statewide offices, including California gubernatorial candidate Steve Hilton, pegged that the state’s annual estimate of fraud, waste and abuse across state programs at $250 billion, an estimate that includes unverified public tips submitted to a campaign-run website.
The group cited the estimate as justification for creating their own “California Department of Government Efficiency,” or CAL DOGE, a nod to a similarly named federal initiative promoted by Elon Musk that generated headlines but has not produced documented savings or formal audit findings. CAL DOGE is not currently a state department, despite its name.
Who deserves credit when fraud is prosecuted has also become a point of contention. After a man was arrested last month for fleecing L.A.’s homeless services program for $23 million, critics of Newsom were quick to blame the governor. Newsom responded by saying the case was uncovered by local investigators working with law enforcement, which he added is “exactly the kind of accountability and oversight the state has pushed for.” (The Los Angeles district attorney’s office ran a parallel, independent investigation.)
Essayli responded on social media by saying no one made an arrest until Trump and Atty. Gen. Pam Bondi “appointed me to investigate and charge fraud offenses in California.”
Kiley, the California Republican congressman, said despite the partisan fighting over fraud, the issue should rally both parties.
The “easiest” way to solve the state’s budget problems and improve government services for taxpayers is to “minimize and eventually eliminate fraud,” said Kiley.
Virginia’s top court on Friday struck down a congressional map drawn by Democrats and recently approved by voters, dealing a major blow to the party as it struggles to keep pace with Republicans in the nation’s redistricting battle.
The ruling will wipe out four newly drawn Democratic-leaning U.S. House districts in Virginia and means that Republicans will enter the midterm elections with a structural advantage from their moves to carve out more red districts across the country.
Congressional maps have for generations been drawn once a decade, after the census, to account for population shifts. But last year, President Trump started a rare, mid-decade gerrymandering war when he persuaded Texas officials to draw a new map to help Republicans as they face midterm headwinds. California countered with a map favoring Democrats. Other red and blue states followed.
After the Virginia map passed in a statewide referendum late last month, Democrats thought that they had battled Republicans to a draw, or that they had even eked out a small advantage. Then a ruling by the U.S. Supreme Court prompted several Southern states to work to pass new maps, which will favor Republicans.
Now, the rejection of the new Virginia map means that across the country, Democrats stand to lose half a dozen safe seats, and possibly more, from redistricting alone.
Still, Republicans face a challenging political environment in their bid to retain control of their slim House majority, including worries about the economy, the unpopular war with Iran, high gas prices and Mr. Trump’s sagging approval ratings.
In its 4-to-3 decision, the Virginia Supreme Court wrote that Democratic legislators had violated the state’s constitution with their move to enact a new map meant to give their party 10 out of the state’s 11 U.S. House seats, up from the six it currently controls. Virginia voters approved a constitutional amendment to allow for the map in a referendum.
The problem, the court’s majority suggested, was that the first vote on the amendment in the General Assembly, which would authorize Democrats to redraw the map, occurred days before last fall’s legislative elections — meaning that some Virginians who cast their ballots early did so without knowing how their state lawmakers would vote on the new map.
That, the justices wrote, violated the process in the State Constitution.
“This constitutional violation incurably taints the resulting referendum vote and nullifies its legal efficacy,” the majority wrote.
Mr. Trump and Republicans celebrated the decision.
“Huge win for the Republican Party, and America, in Virginia,” the president posted on his social media site.
Democrats seemed despondent over the decision after eight months and nearly $70 million invested in passing the referendum.
Representative Hakeem Jeffries of New York, the House minority leader, who lobbied Virginia legislators to advance their redistricting push and then campaigned for the referendum, said that “the decision to overturn an entire election is an unprecedented and undemocratic action that cannot stand.”
He added: “We are exploring all options to overturn this shocking decision.”
What those options are was not clear in the immediate aftermath of the decision.
Some legal experts believe that the Virginia Supreme Court’s ruling may be the final word on the state’s maps before the election. That is because the case involved a state law challenge about whether state lawmakers had followed rules laid out in the Virginia Constitution, not a question of federal law or the U.S. Constitution.
Gov. Abigail Spanberger, a Democrat, said in a statement that “I am disappointed by the Supreme Court of Virginia’s ruling, but my focus as governor will be on ensuring that all voters have the information necessary to make their voices heard this November.”
Since the U.S. Supreme Court’s ruling late last month that further weakened the Voting Rights Act, Republicans in Tennessee, Alabama and Louisiana have taken steps to draw new maps before the midterms. Those efforts could net Republicans a handful of additional safe seats before voters cast a ballot in November. South Carolina is also exploring a new map before November.
While Democrats have themselves grown more ruthless about gerrymandering, they are broadly struggling to keep up.
In part that is because years ago, some Democratic-controlled states like Virginia installed independent commissions to oversee their map-drawing process in an effort to insulate it from politics. But Republicans kept the power in state legislatures, allowing states like Texas, Florida, North Carolina and Missouri to enact partisan maps with few logistical hurdles.
In Virginia, voters approved the amendment to override the independent commission by about three percentage points after the General Assembly had passed it twice. But Republicans challenged nearly every aspect of the process. Most of these lawsuits were filed before in a county court in the rural southwestern corner of the state, where a judge repeatedly ruled in the Republicans’ favor. These rulings were appealed to the State Supreme Court.
In lawsuits, Republicans argued that the language in the amendment was misleading, that the new districts were not drawn compactly, that it was improper to vote on redistricting at a legislative session that had convened to discuss budget issues and that a state law required county clerks to post notices about the amendment months before it was actually voted on.
One of the most critical questions concerned the sequence of events in Virginia’s complex amendment process. Before voters weigh in on an amendment to the State Constitution, the General Assembly must approve it twice, with an election for the state’s House of Delegates taking place between the two votes. The first vote for this amendment was on Oct. 31, just days before the state election. With hundreds of thousands of Virginians having already voted, Republicans argued that the legislative action had come too late.
The court sided with that argument.
“Early Virginia voters unknowingly forfeited their constitutionally protected opportunity to vote for or against delegates who favor or disfavor amending the Constitution by not anticipating a legislative vote on a constitutional amendment four days before the last day of voting,” the court’s majority wrote in its ruling.
But Democrats’ loss in Virginia is likely to only further stoke more redistricting battles. Already, the party’s lawmakers in New York and Colorado have signaled a desire to try and redraw their maps before the 2028 elections, and Virginia Democrats are likely to be in a similar position, since the court mainly took issue with the process, not with the resulting map.
Abbie VanSickle contributed reporting.
Politics
Gorsuch says ideological divides on Supreme Court come down to ‘how you read law,’ not politics
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Supreme Court Justice Neil Gorsuch said differences among his colleagues on the high court are often less about politics than they are about diverging approaches to constitutional interpretation — a dynamic, he said, that influences both the court’s rulings and its internal relations.
“That has nothing to do with politics,” Gorsuch told Fox News Digital in a recent interview. “That has to do [with] how you read law. Interpretive methodologies.”
Gorsuch, who was nominated by President Donald Trump in 2017, has described himself as a “textualist,” noting his approach focuses on interpreting legal texts based on the ordinary meaning of the words as written. The philosophy is linked to originalism — or the view that the Constitution should be interpreted based on its original public meaning when it was adopted.
Other justices have different interpretations, including ones that allow for evolving interpretations over time. Gorsuch stressed that differences, while significant, are not inherently personal.
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U.S. Supreme Court Justice Neil Gorsuch speaks at the Reagan Library on May 5, 2026, in Simi Valley, Calif. (Getty Images)
“At the end of the day, you’re trying to get to the right answer under the law,” he said, adding that disagreement is an expected, and healthy, part of the process.
His remarks come as the federal judiciary and members of the Supreme Court have come under increasing scrutiny in recent years, including by Trump and his allies, who have criticized the courts for impinging on what they see as the duties of the executive branch.
Trump took to Truth Social last month to criticize the Supreme Court’s conservative majority for showing him “very little loyalty” in blocking his so-called “Liberation Day” tariffs in February.
He also suggested they might block his executive order seeking to end so-called “birthright citizenship” in the U.S.
“Certain ‘Republican’ Justices have just gone weak, stupid, and bad, completely violating what they ‘supposedly’ stood for,” Trump said.
JUSTICE GORSUCH HIGHLIGHTS HUMANITY, HISTORY IN CHILDREN’S BOOK CELEBRATING AMERICA’S 250TH ANNIVERSARY
President Donald Trump greets Chief Supreme Court Justice John Roberts as he arrives to deliver an address to a joint session of Congress in 2025. (Win McNamee/Getty Images)
He contrasted this with liberal justices on the court, whom Trump said “stick together like glue, totally loyal to the people and ideology that got them there.”
Gorsuch, for his part, stressed that the justices often share plenty of common ground, even if their interpretation of the Constitution prompts them to reach different conclusions.
That approach, he suggested, carries over into how the justices work together behind closed doors — where collaboration and debate are central to the high court to perform its constitutional duties.
FEDERAL JUDGE BLOCKS TRUMP’S BIRTHRIGHT CITIZENSHIP BAN FOR ALL INFANTS, TESTING LOWER COURT POWERS
The U.S. Supreme Court building is shown in Washington, D.C., on Nov. 13, 2023, as the court unveiled a new ethics code following scandals involving gifts and vacations received by some justices. (Mandel Ngan/AFP)
“The framers understood that people would come to the table with different views,” Gorsuch told Fox News Digital. “The goal is to reason together.”
While ideological divides can be sharp, Gorsuch emphasized that culture at the high court is built on mutual respect.
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“If you sit and listen to someone long enough, you’re going to find something you can agree on,” he added. “Maybe you start there.”
Two press freedom groups that own shares in Paramount Skydance are demanding to see the company’s books and internal documents, citing allegations that the company’s leaders may have promised favors to the White House to win approval for Paramount’s deal to acquire Warner Bros. Discovery.
The letter, sent Thursday to Paramount chief legal officer Makan Delrahim, says that media reports alleging that Paramount owner David Ellison and others promised favors to the Trump administration “create credible concern that Paramount leadership has offered, solicited, or effectuated a corrupt exchange,” which the groups argue would “constitute a breach of fiduciary duties” and open the company up to a “range of potential civil and criminal penalties.”
The letter cites Delaware law that allows stockholders to inspect the company’s books and records “for any proper purpose.”
Paramount declined to comment on the letter.
Among the issues raised in the letter are promises reportedly made by David Ellison and his father, Oracle billionaire Larry Ellison, that they would make “sweeping” changes at the news network CNN, which is owned by Warner Bros. Discovery.
The Ellison family acquired Paramount, which includes CBS and the storied Melrose Avenue film studio, last summer.
The letter cites changes implemented in CBS since their acquisition, including their decision to end late night television house Stephen Colbert’s show days after he characterized a settlement Paramount reached with Trump as a “big fat bribe.”
Under Ellison’s ownership, the letter says, numerous high-profile reporters have left the network and its ratings have dropped to “historic lows.”
Larry Ellison, who is backing the financing of Paramount’s proposed takeover of Warner, reportedly told White House officials that Paramount would “implement the CBS playbook” at CNN if the merger is approved, and remove anchors and commentators at the cable news network that Trump doesn’t like, according to the letter.
The effort comes just two weeks after Warner Bros. Discovery shareholders overwhelmingly approved the proposed merger. Investors have supported the Larry Ellison family takeover, which would become the biggest Hollywood merger in nearly a decade. The deal would pay Warner stockholders $31 per share — four times the stock price a year ago.
The letter was written on behalf of the Freedom of the Press Foundation, which develops secure communication tools for journalists and tracks violations of press freedom, and Reporters Without Borders, which tracks press freedom globally.
The organizations are being represented by former federal prosecutor Brendan Ballou, who established the Public Integrity Project this year to challenged alleged government corruption, as well as Delaware attorney Ronald Poliquin.
The missive, which could be a precursor to a lawsuit, opens another avenue of attack against the controversial $111-billion deal, which would transform the smaller Paramount into an industry titan.
With Warner Bros. Discovery, the Ellisons would also control HBO, TBS and the vast film and TV library of Warner Bros., which includes the Harry Potter, DC Comics, and Scooby-Doo, in addition to CNN.
Paramount, led 43-year-old David Ellison, wants to finalize its Warner Bros. takeover by the end of September. President Trump favors the deal; he has long agitated for changes at CNN.
But the proposed merger would saddle the combined company with $79 billion in debt, stoking fears that Paramount would be forced to make steep cost cuts to juggle such a large debt load.
Politicians, unions and progressive groups separately have pressed California Atty. Gen. Rob Bonta to scrutinize the proposed merger, hoping that he brings an antitrust lawsuit in an attempt to upend the deal.
More than 4,000 film industry workers, including Ben Stiller, Bryan Cranston, Ted Danson, J.J. Abrams, Jane Fonda and Kristen Stewart, have signed an open letter imploring Bonta and other regulators to block the merger. The group lamented the proposed tie-up, saying it “would reduce the number of major U.S. film studios to just four.”
Opponents fear the consolidation would lead to massive layoffs and diminish the quality of programming that Warner Bros., CNN and HBO are known for.
Hollywood has sustained thousands of layoffs over the last seven years since Walt Disney Co. swallowed Fox’s entertainment assets in another huge merger. In addition, the film production economy hasn’t recovered from shutdowns during the 2023 labor strikes. An estimated 42,000 entertainment industry jobs were lost from 2022 and 2024.
On Thursday, 34 California Democrats in Congress also sent a letter to Bonta, encouraging him to look closely at the merger.
The deal is expected to become one of the largest leveraged buyouts ever.
Ballou, who is working with the press freedom groups, previously served as a Justice Department special counsel with expertise in private equity transactions.
He resigned from the Justice Department in January 2025 when Trump returned to office. In his book, “Plunder: Private Equity’s Plan to Pillage America,” Ballou examined large leveraged buyouts and found that many of which resulted in bankruptcies.
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