MINNEAPOLIS — Federal prosecutors have indicted eight people for wire fraud related to an extensive scheme that drained millions from Minnesota’s Housing Stabilization Services (HSS) Program, a Medicaid-funded effort aimed at assisting at-risk groups in securing and keeping stable housing.
The indictments, revealed by Acting U.S. Attorney Joseph H. Thompson, represent what officials describe as the “first wave” of prosecutions in a continuing federal probe into the rampant misuse of the state’s housing initiative.
“What we see are schemes stacked upon schemes, draining resources meant for those in need,” said Thompson. “The depth of the fraud in Minnesota takes my breath away. The fraud must be stopped.”
About the Housing Stabilization Services Program
Launched in July 2022, Minnesota’s HSS Program was the first in the nation to provide Medicaid coverage for housing-related services. It was specifically created to assist:
- Seniors
- Individuals with disabilities
- People with mental illnesses
- Those recovering from substance use disorders
- The program covers four types of services:
- Housing consultation
- Housing transition services
- Housing sustaining services
- Moving expenses
Designed with low barriers to entry and minimal documentation requirements, the program was intended to expedite access to critical housing support services for those in need. But those same features, prosecutors say, made it highly vulnerable to fraud.
The Fraudulent Scheme
According to court documents, the defendants exploited the program’s weak oversight to submit fake and inflated claims for housing services that were never provided.
Key aspects of the alleged scheme include:
- Obtaining personal information of eligible Medicaid recipients from addiction treatment centers and other facilities.
- Submitting fraudulent reimbursement claims using those identities.
- Pocketing large sums of taxpayer money under the guise of providing housing support.
- Instead of using the funds to assist vulnerable individuals, the defendants allegedly used the money for personal enrichment.
The scale of the fraud was mirrored in the program’s ballooning costs. According to federal investigators:
The HSS Program was initially projected to cost $2.6 million annually.
Actual payouts soared to:
- $21 million in 2021
- $42 million in 2022
- $74 million in 2023
- $104 million in 2024
- $61 million in just the first half of 2025
Case 1: United States v. Moktar Aden et al. — Brilliant Minds Services LLC
Defendants:
- Moktar Hassan Aden, 30
- Mustafa Dayib Ali, 29
- Khalid Ahmed Dayib, 26
- Abdifitah Mohamud Mohamed, 27
From September 2022 to April 2025, the defendants allegedly operated Brilliant Minds Services LLC and submitted more than $2.3 million in fraudulent Medicaid claims, offering only a fraction of the services billed.
Top 10 biller in 2024 among HSS providers
Funds were allegedly used to pay $400,000 each to the defendants and nearly $500,000 in American Express charges
Mohamed also operated a second company, Foundation First Services, which submitted additional questionable claims
Case 2: United States v. Christopher and Emmanuel Falade — Faladcare Inc.
Defendants:
- Christopher Adesoji Falade, 62
- Emmanuel Oluwademilade Falade, 32
Father and son duo allegedly operated Faladcare Inc., submitting over $2.2 million in inflated and fake claims for services supposedly provided to around 100 Medicaid beneficiaries. Much of the money was allegedly diverted to employees and co-conspirators.
Case 3: United States v. Asad Ahmed Adow — Leo Human Services LLC
Defendant:
- Asad Ahmed Adow, 26
Adow is accused of running Leo Human Services LLC, where he allegedly encouraged employees to inflate hours and submit false service notes. His company received approximately $2.7 million in Medicaid funds for services provided to around 250 beneficiaries.
Allegedly used funds to buy real estate in Kenya, lease a 2024 BMW X4, and rent a Roseville apartment
Directed funds to co-conspirators, including his brother
Case 4: United States v. Anwar Ahmed Adow — Liberty Plus LLC
Defendant:
- Anwar Ahmed Adow, 25
Brother of Asad Adow, Anwar allegedly used the same methods at his company, Liberty Plus LLC, submitting over $1.2 million in false claims for about 200 beneficiaries.
Used proceeds to lease a 2023 Mercedes-Benz CLA, make investments, and fund a personal lifestyle
Widespread Scheme, National Attention
These four cases collectively represent a fraud scheme that looted over $8 million from a Medicaid program hailed as a national model. Authorities believe the fraud is far more extensive, with investigations still ongoing.
The Minnesota HSS Program, launched in 2022, was the first in the U.S. to provide Medicaid housing support for people with disabilities and mental health challenges. While the program was designed with low barriers to entry to facilitate access, officials now acknowledge those same features created opportunities for systematic abuse.
Law Enforcement Response
Statements from Federal and State Officials:
“Exploiting this program undermines the financial and physical security of the community amid a housing and addiction crisis,” said FBI Special Agent in Charge Alvin M. Winston Sr.
“Taxpayer dollars were stolen by greedy opportunists,” said Adam Jobes, Special Agent in Charge, IRS Criminal Investigation.
“This was a calculated effort to exploit a program meant to serve the most vulnerable,” said Mario M. Pinto, Special Agent in Charge, HHS Office of Inspector General.
“This is not just financial fraud — it’s a theft of opportunity, stability, and dignity,” added Drew Evans, Superintendent of the Minnesota Bureau of Criminal Apprehension.
Ongoing Investigation
The Justice Department made clear that these eight defendants represent just the beginning of a broader crackdown.
“This is just the first wave,” Thompson emphasized. “We are committed to holding every person accountable who stole from a system that was supposed to help our most vulnerable citizens.”
No names of the defendants have been publicly released yet, and the investigation remains active. Prosecutors have signaled that more arrests and charges are likely.
The accused are facing allegations of wire fraud, which is a federal crime that could result in a maximum sentence of 20 years in prison for each count. More charges might be added as the investigation progresses.
