Latest fraud charges filed against suspects in Minn. housing, child care schemes

Sarah Nelson, The Minnesota Star Tribune on May 20, 2026

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Federal prosecutors have leveled their latest fraud charges against a group of people accused of stealing millions from Minnesota’s housing and child care programs.

Fahima Egeh Mahamud faces one count of conspiring to defraud the United States, alleging that from October 2022 through December 2025, she collected $4.6 million by submitting false claims purporting to collect co-payments for her child care center, Future Leaders Early Learning Center. Mahamud was already charged with wire fraud after being accused of receiving more than $854,000 in funds through the federal child nutrition program by submitting false or inflated invoices.

The Minnesota Star Tribune discovered that Future Leaders Early Learning Center operated as a meal site under Feeding Our Future, the nonprofit at the center of the largest pandemic-era fraud in the U.S. Mahamud was charged in connection with the food fraud investigation in February when she tried to board a flight to London. She is the 79th defendant in the sprawling $300 million Feeding Our Future million scheme.

The U.S. Attorney’s Office also brought charges against another day care owner on Wednesday.

Jillaine Mertens was charged with one count of wire fraud alleging she inflated the number of hours worked by staff at her day care centers and submitted false applications to rake in funds from Minnesota’s Great Start Compensation Support Payment Program. The Minnesota-funded program provided child care educators with supplemental pay based on the number of full-time equivalent staff who regularly care for children.

Prosecutors in charging documents allege Mertens was paid $425,000 from November 2024 through May 2025 by making false claims to the Minnesota Department of Children, Youth and Families through her three child care centers: Creative Stars Academy in Rochester and Kasson, Minn., and Tree of Life Academy in Ramsey.

Online court records show Mertens will enter a plea during her first court appearance on June 4 in U.S. District Court in Minneapolis.

Prosecutors also brought charges against two men accused of defrauding the state’s housing program.

Mustafa Dayib and Abdulbasit Ibrahim are each charged with one count of conspiracy to commit health care fraud after federal prosecutors say they defrauded the state’s Housing Stabilization Services program by receiving $975,000 in Medicaid money for services they did not provide.

The Minnesota Star Tribune has reached out to attorneys for each of the accused.

Dayib and Ibrahim are among the more than dozen people charged in the massive scheme to defraud the state’s Housing Stabilization Services program. The state program was meant to help find housing for older adults and people with disabilities, including those with mental illness and substance-use disorder. Minnesota was one of the first states to launch the benefit in 2020.

The Minnesota Department of Human Services ultimately terminated the program last year due to widespread fraud.