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Fraud fallout forces Democratic Gov Tim Walz to abandon Minnesota re-election bid

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Fraud fallout forces Democratic Gov Tim Walz to abandon Minnesota re-election bid

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Gov. Tim Walz of Minnesota announced on Monday that he’s dropping his bid for an unprecedented third term as governor amid stinging criticism of the unsuccessful 2024 Democratic vice presidential nominee’s handling of his state’s massive welfare assistance fraud scandal.

“As I reflected on this moment with my family and my team over the holidays, I came to the conclusion that I can’t give a political campaign my all,” Walz wrote in a statement. “Every minute I spend defending my own political interests would be a minute I can’t spend defending the people of Minnesota against the criminals who prey on our generosity and the cynics who prey on our differences.”

“So I’ve decided to step out of this race and let others worry about the election while I focus on the work in front of me for the next year,” the governor added in his statement and in front of cameras a couple of hours later. The governor didn’t take any questions but said on Tuesday he would return to “take all your questions.”

And pointing to his efforts to deal with the growing fraud scandal, Walz charged, “The political gamesmanship we’re seeing from Republicans is only making that fight harder to win.”

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GOP LAWMAKER UNVEILS WALZ ACT AFTER BILLIONS LOST IN MINNESOTA FRAUD SCANDAL

Minnesota Gov. Tim Walz, at a news conference at the Minnesota State Capitol on Monday, Jan. 5, 2026, in St. Paul, Minn., announces he’s dropping his 2026 re-election bid. (Kerem Yücel/Minnesota Public Radio via AP)

Walz launched his bid for a third four-year term as Minnesota governor in September, but in recent weeks has been facing a barrage of incoming political fire from President Donald Trump and Republicans, and some Democrats, over the large-scale theft in a state that has long prided itself on good governance.

More than 90 people — most from Minnesota’s large Somali community — have been charged since 2022 in what has been described as the nation’s largest COVID-era scheme. How much money has been stolen through alleged money laundering operations involving fraudulent meal and housing programs, daycare centers, and Medicaid services is still being tabulated. But the U.S. attorney in Minnesota said the scope of the fraud could exceed $1 billion and rise to as high as $9 billion.

MEDIA ‘COMPLICITY’ BLAMED AS FEDS SAY MINNESOTA FRAUD CRISIS COULD REACH $9B: ‘SHOWN THEIR TRUE COLORS’

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Minnesota Gov. Tim Walz speaks at a press conference. (Christopher Mark Juhn/Anadolu via Getty Images)

Prosecutors said that some of the dozens that have already pleaded guilty in the case used the money to buy luxury cars, real estate, jewelry and international vacations, with some of the funds also sent overseas and potentially into the hands of Islamic terrorists.

“This is on my watch, I am accountable for this and, more importantly, I am the one that will fix it,” Walz told reporters last month, as he took responsibility for the scandal.

The governor took actions to stop some of the suspected fraudulent payments, and ordered an outside audit of Medicaid billing in the state.

But Trump repeatedly blasted Walz as “incompetent” and, during Thanksgiving, used a slur for developmentally disabled people to describe the governor.

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The sun shines on the Minnesota State Capitol. (Steve Karnowski/Associated Press)

The scandal, which grabbed plenty of national attention over the past two months, went viral the past few weeks following the release of a video by 23-year-old YouTube content creator Nick Shirley, who alleged widespread fraud at Somali-run daycare centers. Days later, the Trump administration froze federal child-care funding to Minnesota.

Reactions quickly began to pour in following the Walz announcement. 

“Good riddance,” Republican House Majority Whip Tom Emmer, who represents Minnesota’s 6th Congressional District, said in a statement.

Republican Governors Association Communications Director Courtney Alexander charged in a statement that “Walz’s failed leadership is emblematic of Minnesota Democrats’ agenda and whoever Democrats choose to replace Walz with at the top of the ticket will need to defend years of mismanagement and misplaced priorities.”

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Minnesota Republican state Rep. Kristin Robbins, a candidate for governor, released a statement saying, “Tim Walz and his staggering fraud could not outrun our investigations and the momentum we have in this race.”

“He knows he will lose in November, and would rather give up than take responsibility. Anyone Walz handpicks to run for governor will own the fraud and failures of this administration. Our campaign is building the coalition necessary to stop the fraud, protect our kids, and make Minnesota prosper. As Governor, I will dismantle the years of fraud Democrats allowed and ensure our tax dollars work for Minnesotans.”

Minnesota House Speaker Lisa Demuth, another leading Republican gubernatorial candidate, took to social media to argue, “If Democrats think they can sweep Minnesota’s fraud scandal away by swapping out Tim Walz, they are wrong.”

“We need transformational change across state government that only comes with a Republican governor. I will deliver that no matter who the Democrats decide to run,” Demuth emphasized.

Joe Teirab, a former federal prosecutor who worked on the Feeding our Future fraud case that was a key part of the unfolding fraud scandal, told Fox News Digital that Walz “allowed fraudsters to steal billions from taxpayers, and did nothing.”

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“The only fraud scheme Walz has chosen to end is his political career,” Teirab said. 

But Democratic Governors Association (DGA) chair Gov. Andy Beshear of Kentucky said in a statement, “No matter who decides to run or how much national Republicans want to spend, the DGA remains very confident Minnesotans will elect another strong Democratic governor this November.”

And Besehar praised Walz, a former DGA chair, as “a true leader who has delivered results that will make life better for Minnesota workers and families for years to come.”

Democratic National Committee chair Ken Martin, a former longtime state party chair in Minnesota, said the decision by Walz “is entirely consistent with who Tim is. Tim has always believed that leadership isn’t about preserving your own power — it’s about using it to make a difference for as many people as possible.”

“In the months ahead, Tim will continue doing what he’s done throughout his career: standing up to Donald Trump, defending Minnesota’s values, and fighting for working people,” Martin predicted.

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Walz met Sunday with Democratic Sen. Amy Klobuchar of Minnesota to discuss his decision to drop his re-election bid, a source familiar confirmed to Fox News’ Alexis McAdams.

Word of their meeting comes amid speculation that Klobuchar, a former Hennepin County attorney who’s been elected and re-elected four times to the U.S. Senate, may now run to succeed Walz.

Walz said he was “absolutely confident” that Democrats would “hold this seat come November.”

And the governor touted that if he had continued to seek re-election, “I have every confidence that, if I gave it my all, we would win that race.”

In the nation’s capital, the Republican chairman of the House Committee on Oversight and Government Reform, which is investigating Minnesota’s fraud scandal, took aim at Walz.

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“Though Tim Walz is not running for governor again, he cannot run from accountability,” Rep. James Comer of Kentucky charged in a statement. “The House Oversight Committee demands that he appear for a public hearing on February 10 to expose this fraud and begin the process of accountability. The American people deserve answers, and they deserve them now.”

The statement was echoed by the White House, with spokeswoman Abigail Jackson saying,”Tim should know, that dropping out of the race won’t shield him from the consequences of his actions.” 

 But Walz, firing back, claimed that “Donald Trump and his allies – in Washington, in St. Paul, and online – want to make our state a colder, meaner place. They want to poison our people against each other by attacking our neighbors. And, ultimately, they want to take away much of what makes Minnesota the best place in America to raise a family.”

“They’ve already begun by taking our tax dollars that were meant to help families afford child care. And they have no intention of stopping there,” the governor argued.

The 61-year-old Walz was raised in rural Nebraska and enlisted in the Army National Guard in 1981, soon after graduating from high school.

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Walz returned to Nebraska to attend Chadron State College, where he graduated in 1989 with a degree in social science education.

He taught English and American History in China for one year through a program at Harvard University before being hired in 1990 as a high school teacher and football and basketball coach in Nebraska. Six years later, he moved to Mankato, Minnesota, to teach geography at Mankato West High.

Walz was deployed to Italy to support Operation Enduring Freedom in 2003 before retiring two years later from the National Guard.

He was elected to the House in 2006 and re-elected five times, representing Minnesota’s 1st Congressional District, a mostly rural district covering the southern part of the state that includes a number of midsize cities. During his last two years on Capitol Hill, he served as ranking member of the House Veterans Affairs Committee. 

Walz won election as governor in 2018 and re-election four years later.

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Former Vice President Kamala Harris and Minnesota Gov. Tim Walz walk out on stage together during a campaign event on Aug. 6, 2024, in Philadelphia, Pennsylvania. (Andrew Harnik/Getty Images)

But Walz was unknown to many Americans when then-Vice President Kamala Harris chose the Minnesota governor as her running mate in the summer of 2024, soon after she replaced then-President Joe Biden as the Democrats’ presidential nominee.

Walz, during his three months as running mate, visually and vocally embraced the traditional role of political attack dog that has long been associated with vice presidential nominees.

But Harris and Walz fell short, losing the November 2024 election to Trump and now-Vice President JD Vance, as the Democratic Party ticket was swept in all seven crucial battleground states.

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Pundits considered Walz a possible contender for the Democratic Party’s 2028 presidential nomination. 

But Walz said in multiple interviews last summer that he had no interest in seeking the presidency.

And the ongoing fraud scandal and his decision to end his gubernatorial re-election bid seems to put an end to Walz’ recent tenure in national politics.

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Senate hopeful with deep Dem ties slapped with scathing complaint targeting alleged family payout ‘scheme’

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Senate hopeful with deep Dem ties slapped with scathing complaint targeting alleged family payout ‘scheme’

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FIRST ON FOX: A watchdog is urging the Federal Election Commission (FEC) to investigate Nebraska Senate hopeful Dan Osborn, alleging he is improperly steering campaign funds for personal use to nearly half-a-dozen of his relatives, including around a quarter-million-dollars to his wife alone, through his principal campaign committee and a web of political action committees.

Last month, Fox News Digital reported on Osborn’s spending that has come under scrutiny, showing that north of $370,000 had been disbursed to his wife, daughter, sister-in-law, and to himself through his campaign and a web of political action committees. 

A complaint filed with the FEC Monday by conservative watchdog Americans for Public Trust, is now calling on the FEC to investigate Osborn’s spending, and lays out even more relatives receiving money from Osborn’s campaign plus another consulting firm his wife works at that has been receiving funds. In total, the complaint says, Osborn, his wife Megan, daughter Georgia, sister-in-law Jodi, second sister-in-law Bridget and brother-in-law James have received $434,734.42.

Fox News Digital reached out to the Osborn campaign with questions about the payments, but many of them went unanswered. However, a campaign spokesperson did tell Fox News Digital that the campaign “is fully compliant with all FEC rules.”

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Independent Senate candidate Dan Osborn chats with attendees after speaking during his campaign stop at the Handlebend coffeshop in O’Neill, Neb., on Monday, October 14, 2024. Osborn is running againt Sen. Deb Fischer, R-Neb. (Bill Clark/CQ-Roll Call, Inc via Getty Images)

“We haven’t received any formal complaints, but what you describe are baseless, nuisance allegations designed to slow Dan’s momentum as he’s tied with Pete Ricketts in four straight polls,” the spokesperson said. 

While paying family members with campaign money is not necessarily a violation of campaign finance law, concerns have been raised about whether Osborn’s payments to his family members have followed the campaign finance laws that must still be adhered to, such as that the pay must be at fair-market value, it must be strictly for campaign services, must be transparently reported and must not be used for personal expenses, meaning expenses incurred irregardless of the ongoing campaign, like housing costs. 

Entities not controlled and operated by candidates can deal in what is called “soft money,” or money that does not need to comply with federal limits. However, that money cannot then be controlled by the candidate to help him directly with his campaign. Money from entities controlled by candidates, often referred to as “hard money,” must follow the FEC’s limits and other rules.

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Americans for Public Trust is accusing Osborn of using an end-around to funnel money to his relatives, including from a now-defunct campaign. They cite the fact that Osborn’s Working Class Heroes Fund (WCHF), which he launched in 2024, has a “join the movement” button that routes users to a form so they can be contacted by a different PAC called the League of Labor Voters. They also cite the involvement of Osborn’s custodian of records for his failed 2024 Senate campaign, Brandon Philipczyk, who was also listed as such in Statement of Organization for Osborn’s WCHF and LLV until just a few days ago.

Americans for Public Trust is alleging that these are not truly outside groups — they are effectively part of Osborn’s operation — and therefore shouldn’t be raising or spending money in ways that function like an end-around to bypass federal limitations.

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“Despite being established, financed, maintained, or controlled by federal candidate Dan Osborn and his agents, WCHF and LLV have solicited, received, directed, transferred, or spent funds that do not comply with FECA’s contribution limitations, source prohibitions, and reporting requirements, including receiving contributions from individuals in excess of $5,000 and receiving funds from prohibited sources,” the complaint letter to the FEC states.

Independent Dan Osborn, a challenger to two-term Republican Sen. Deb Fischer in 2024, chats with guests at a brewery in Beatrice, Neb. (AP/Margery Beck)

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Osborn’s wife, Megan, who reportedly was a former bar manager, has raked in around a quarter-million dollars from Osborn’s campaign and a web of political action committees tied to him. In some cases, Megan has gotten money directly from her husband’s campaign and in other cases she has received it from two firms, one called Independent Campaigns LLC, which Megan has a one-third ownership stake in, and Dark Forest LLC, which official candidate disclosures show Megan gets compensation from. 

Just two days after Independent Campaigns was set up, Osborn’s WCHF made its first $50,000 payment to the firm, according to local Nebraska news outlet the Lincoln-Journal Star. Thus far, per the FEC complaint, Independent Campaigns has received nearly $200,000 from Osborn and WCHF and another PAC called the League of Labor Voters (LLV), which Americans for Public Trust also alleges is controlled by Osborn.

In total, per the Americans for Public Trust complaint letter, Osborn’s wife has been able to rake in close to $300,00 for herself for things like “strategy consulting” and work reimbursements. 

Osborn’s daughter Georgia, a part-time dancer who Osborn says still needs help paying her bills, was given $4,200 between when Osborn’s first 2024 campaign lost, and before launching his 2026 bid. The money was for “assistant services” from the then-dormant campaign. 

Osborn’s sister-in-law, Jodi, received $1,400 for “treasurer services” from WCHF at the end of 2025, according to campaign disclosures which also show that she is listed as WCHF’s Treasurer.

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Meanwhile, the group also points to a $2,500 payment to Osborn’s brother-in-law, who served as treasurer of Osborn’s 2024 committee, as part of what it calls a broader pattern of family-linked payments that should be scrutinized for bona fide services and fair-market rates.

“Perhaps the Osborn family is teeming with previously undiscovered, dynastic political talent, akin to the Kennedys or Roosevelts,” the Americans for Public Trust letter to the FEC says. “Or perhaps Mr. Osborn has realized his ability to funnel large amounts of unchecked campaign cash to his own family.”

Caitlin Sutherland, Executive Director of Americans for Public Trust, added that Osborn “has become too comfortable blurring the lines between family, fortune, and campaign finance law.”

“Osborn has engaged in various tactics — including utilizing a defunct campaign account — to enrich members of both his immediate and extended family,” Sutherland continued. “In addition to lining the pockets of his close relatives, who appear to lack any notable professional campaign experience—Osborn is racking up federal campaign finance violations by orchestrating a scheme that seemingly finds him illegally running and controlling multiple federal PACs.”  

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Besides questions about how Osborn is paying himself and his loved ones, critics of the candidate have also balked at his decision to run as an Independent. Osborn has indicated he has no plans to caucus with either major party if elected and says on his website that, as an Independent, he is “uniquely positioned” to get things done in Congress. Meanwhile, speaking at a town hall, Osborn reportedly told Nebraskans that if his bid as an Independent didn’t work out, “there’s only one party I would caucus with.”

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When pressed on which political party he was speaking of, Osborn replied: “Not (Republican) Pete Ricketts’s party,” according to the audio reviewed by Nebraska news organization The Plains Sentinel. However, Osborn’s decision to cash in on national Democratic Party support, including utilizing the party’s main fundraising platform, ActBlue, have led to questions about how independent he really will be.

Labor Union leader Dan Osborn is running for a second election in a row to be a U.S. Senator after losing in 2024. (Leigh Vogel/Wire Image and Bill Clark/CQ-Roll Call, Inc via Getty Images)

In December, Osborn was slammed for hiring an anti-cop staffer seen at an anti-police event featuring severed pig heads, and the agency creating Osborn’s ads, Fight Agency, was also behind ads for the Zohran Mamdani, Sen. Bernie Sanders, I-Vt., Rep. Greg Casar, D-Texas, and other Democrats. 

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One of the firm’s leaders said they were struck by Osborn’s “over performance” in 2024, leading him to surmise “that Democrats need to run a lot of different kinds of campaigns.”

The consulting firm co-owned by Osborn’s wife, Independent Campaigns, has also worked with Democrat candidates. FEC filings show Nathan Sage, a Democrat running for Senate in Iowa, has paid thousands to Osborn’s wife’s consulting firm.

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Californians may need to mail ballots early as Supreme Court signals support for new election day deadline

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Californians may need to mail ballots early as Supreme Court signals support for new election day deadline

Californians may be forced to put their ballots in the mail well before election day to be certain they will be counted.

That’s the likely outcome of a Republican challenge to mail ballots that came before the Supreme Court on Monday.

The court’s six conservatives sounded ready to rule that federal law requires that ballots must be received by election day if they are to be counted as legal.

In the 19th century, Congress set a national day for federal elections on a Tuesday in early November, but it did not say how or when states would count their ballots. The Constitution leaves it to states to decide the “times, places and manners for holding elections.”

California and 13 other states count mail ballots that were cast before or on election day but arrive a few days late. And most states accept late ballots from members of the military who are stationed overseas.

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By law, California counts mail ballots that arrive within seven days of election day. In 2024, more than 406,000 of these late-arriving ballots were counted in California, about 2.5% of the total.

Other Western states — Washington, Oregon, Nevada and Alaska — also count late-arriving mail ballots.

But President Trump has repeatedly claimed that voting by mail leads to fraud, and the Republican National Committee has gone to court to challenge the state laws that allow for counting the legally cast ballots of citizens which are postmarked on time but arrive late.

GOP lawyers argued that the phrase “election day” has always meant ballots must be in the hands of election officials on that day. In their questions and comments, all six conservatives agreed.

Justice Samuel A. Alito Jr. saw a real prospect of fraud. There could be “a big stash of ballots” that arrive late and “flip the outcome,” he said.

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Democrats and election law experts say that the proposed new rule conflicts with more than a century of practice, because most states allowed for some people to vote by mail if they were traveling on election day. They argued that election day is like the federal tax day of April 15. While tax returns must be postmarked then, the tax returns are legal even if they arrive at the Internal Revenue Service a few days later.

The GOP filed its challenge in Mississippi, which accepts ballots that arrive up to five days after election day. A district judge rejected the claim, but a 5th Circuit Court panel with three Trump appointees ruled that ballots are illegal if they are not received by election day.

The case before the court is Watson vs. Republican National Committee.

California has been criticized for taking weeks to count all the votes, but that issue was not raised in this case.

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As cattle herds shrink and beef prices rise, investors back AI cow collars

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As cattle herds shrink and beef prices rise, investors back AI cow collars

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A startup putting high-tech collars on cows could soon be worth more than $2 billion, as investors bet the technology could help farmers cut costs and cope with labor shortages.

Halter, a New Zealand-based company, is in talks to raise new funding in a deal expected to be led by billionaire Peter Thiel’s Founders Fund, according to a Bloomberg report. The round is attracting heavy investor interest and is close to being filled, though final details are still being negotiated.

THE SINGLE CRUSHING PROBLEM AMERICAN CATTLE RANCHERS WISH TRUMP WOULD FIX INSTEAD

A ranch hand rounds up cattle by horseback and drive them into the pens at the Adams Ranch Inc. in St. Lucie County, Florida on July 9, 2013. (Ty Wright/Bloomberg/Getty Images)

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Farmers are increasingly looking for ways to lower expenses and boost efficiency — changes that could eventually affect food prices for consumers.

Beef prices are already soaring, and economists warn Americans shouldn’t expect relief anytime soon as the U.S. cattle herd has shrunk to its smallest size in 75 years.

The decline has been driven by years of drought, rising costs and an aging ranching workforce. Experts say rebuilding herds will take years, meaning beef prices are likely to remain elevated. 

According to U.S. Department of Agriculture data, the average price of beef in grocery stores climbed from about $8.60 per pound in February 2025 to $10.12 per pound a year later — a roughly 18% increase.

THE COST OF THIS GROCERY STAPLE IS NEARING RECORD HIGHS — AND AMERICANS CAN’T GET ENOUGH

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Against that backdrop, Halter is pitching technology aimed at helping farmers do more with less.

The company’s solar-powered, artificial intelligence-driven collars let ranchers herd cattle without fences, using GPS, sound and vibration signals controlled through a smartphone app. The system also tracks livestock health and movement in real time, giving farmers a way to manage herds remotely.

The goal is straightforward — fewer workers, lower costs and more efficient land use.

THE SURPRISING REASON WHY AMERICANS COULD FACE HIGH BEEF PRICES FOR YEARS

Cattle are shown in pens at the Cattlemen’s Columbus Livestock Auction in Columbus Wednesday, Oct. 8, 2025. (Melissa Phillip/Houston Chronicle/Getty Images)

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Halter is part of a broader push toward “precision agriculture,” where technology is used to modernize farming. But that sector has struggled in recent years, with a wave of startups collapsing and investors pulling back amid high costs and slow adoption.

The company has also expanded into the U.S., opening an office in Colorado and targeting American ranchers as a key growth market.

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If the latest round closes as expected, it would signal renewed confidence that AI can succeed in farming — an industry where many tech bets have fallen short.

Halter did not immediately respond to Fox News Digital’s request for comment.

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