Texas Gov. Greg Abbott on January 5 directed two state agencies to investigate potential fraud in the state’s subsidized child care system, citing recent national attention on alleged misuse of child care funds in other states.
In a letter to the Texas Workforce Commission (TWC) and the Health and Human Services Commission (HHSC), Abbott said the action was prompted by reports of “potential systematic fraud in subsidized child care systems in states like Minnesota,” which he said had been uncovered by the Trump administration and independent journalists.
The scrutiny follows a December 26 video posted on X by independent journalist Nick Shirley, who alleged widespread fraud involving Somali immigrant-run child care and health care facilities in Minnesota. Shirley claimed that he visited multiple sites in a single day that had allegedly collected more than $110 million in fraudulent payments. The video was reposted by Elon Musk and Vice President JD Vance and has received more than 138 million views on the platform.
On December 31, the Trump administration announced it would pause child care funding to all states, stating that funds would be released “only when states prove they are being spent legitimately.”
In his letter, Abbott emphasized that Texas would take a proactive approach. “Such fraud will never be tolerated in Texas,” he wrote. “Today, I directed Texas state agencies to take proactive steps to prevent, detect, and eliminate misuse of taxpayer funds to protect the integrity of Texas’ Child Care Services Program.”
Abbott also pointed to existing state efforts, saying, “These strong anti-fraud measures have shown results as Texas’ percentage of improper payment rates is 0.43 percent, compared to Minnesota’s approximately 11 percent according to the most recently available federal data.”
Under the governor’s directive, HHSC and TWC are tasked with identifying high-risk providers and conducting site visits, reviewing current data collection practices, verifying reported enrollment numbers, and determining whether providers are meeting program standards. The agencies are also instructed to offer additional training where needed and to improve access to online reporting tools to make it easier for Texans to report suspected fraud.
The agencies must submit a progress report to the governor’s office by January 30 and a final report by February 27.
The issue has drawn responses from several Republican lawmakers. U.S. Sen. Ted Cruz of Texas defended Shirley on X following an interview Shirley gave to CNN, criticizing the network’s reporting and saying that Shirley “did the only real ‘journalism’ here.”
Rep. Chip Roy (R-TX-21) also weighed in during an appearance on Fox News, placing responsibility on Minnesota Gov. Tim Walz. “It defies all logic and reason to believe that Governor Walz was ignorant of what was happening in Minnesota... He was campaigning on it last year,” Roy said.
Walz, a Democrat, announced on January 5 that he would step down from the 2026 Minnesota governor’s race. In a statement, he criticized former President Donald Trump, saying Trump wanted to make Minnesota “a colder, meaner place,” and accused him of starting by taking “tax dollars that were meant to help families afford child care.”
While Walz criticized Trump and Republicans multiple times in his post, he also said, “We welcome ideas from anyone, in any party, who wants to help us continue to stay ahead of the criminals. And we welcome the involvement of the federal government.”
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