The public has focused on Feeding Our Future ever since federal prosecutors charged 49 people last month in a wide-ranging food-aid fraud scandal. But a close read of 270 pages of criminal charges point to the alleged involvement of another similar organization.
Authorities allege in indictments that another organization separate from Feeding Our Future is responsible for at least $57.7 million of the $250 million of fraudulent claims identified by investigators. The documents don’t name that other organization, and instead refer to it as “Sponsor A.” The indictments allege that a former employee and board member of Sponsor A received illegal kickbacks from food sites and vendors using money from the federal Child Nutrition Programs.
Documents from a lawsuit, search warrant affidavits, and a federal complaint filed in May show that the indictments’ information about Sponsor A correlates with Partners in Quality Care, a St. Paul-based sponsor organization similar to Feeding Our Future. Additionally, a previous charge and search warrant affidavits in the federal investigation directly named Partners in Quality Care as an organization that food sites allegedly used to fraudulently obtain federal food-aid money.
No employees of Partners in Quality Care have been indicted in the case. Lawyers and a top staffer at Partners in Quality Care did not return phone calls and email messages seeking comment for this story.
One week after the indictments were announced, the Minnesota Department of Education filed legal documents identifying Sponsor A as Partners in Quality Care. Partners in Quality Care had filed a lawsuit against the department in early September demanding that the state allow it to regain access to federal food-aid money, which was cut off in January. A federal judge sided with the state earlier this week and denied Partners in Quality Care’s request.
Former federal prosecutor Mark Osler, a professor at the University of St. Thomas School of Law, said the federal government’s allegations suggest that both Feeding Our Future and Partners in Quality Care were responsible for “huge frauds.”
“Fifty-seven million dollars may not seem like a lot compared to $250 million,” Osler said, “but that’s a huge fraud in and of itself.”
A spokesperson with the U.S. Attorney’s Office declined to comment on the matter.
However, when Minnesota U.S. Attorney Andrew Luger announced charges on September 20 against several defendants in the food-aid fraud investigation, he hinted at more to come. Forty-nine people have been charged in the case.
Luger noted that the fraud scheme “extends beyond these defendants.”
“This $250 million is the floor,” he told reporters at the time, referring to the alleged dollar amount embezzled from the federal government by people reporting to use the money to feed underprivileged children. “Our investigation continues.”
Luger described Feeding Our Future and its former executive director, Aimee Bock, as “at the core of this fraud,” but said the indictments “don’t list a ringleader” of the alleged scheme.
Luger refused to answer questions about the roles similar sponsor organizations like Partners in Quality Care may have played in the fraud. Instead, he instructed reporters to read the indictments.
Employee comes under scrutiny
The indictments filed in September don’t name Partners in Quality Care. They refer generically to Sponsor A. According to the indictments, Sponsor A “dramatically increased” the number of food sites it distributed money to during the pandemic. Most of these sites working under Sponsor A “fraudulently inflated their claims in order to appear that they were providing more food to children than was true,” the indictments allege.
Partners in Quality Care grew just as rapidly as Feeding Our Future by sponsoring food sites during the COVID-19 pandemic. As a sponsor organization, it contracted with smaller organizations, reviewed paperwork from those groups reporting how many meals they served, and relayed that information to the Minnesota Department of Education in order to receive federal food-aid money. Sponsor organizations received the federal food-aid funds from the education department and distributed it to their contract organizations.
Prosecutors believe people along the chain of custody greatly exaggerated or completely invented the number of meals the organizations served so they would receive more money. Some food sites were created solely to embezzle money, prosecutors allege.
The indictments say Sponsor A received $5.6 million in federal food-aid compensation in 2019, and grew to more than $179 million in 2021. Similarly, Feeding Our Future grew from $3.4 million in 2019 to $198 million in 2021.
The indictments name four organizations that allegedly participated in the scheme using both Feeding Our Future and Sponsor A as sponsors at different times during the timeframe of the alleged fraud. The organizations are Empire Cuisine & Market, The Produce LLC, ThinkTechAct Foundation, and Minnesota’s Somali Community. The state education department’s subsequent legal documents state that these four organizations worked with Partners in Quality Care during the timeframe outlined in the indictments.
The indictments allege that Sponsor A funneled $57.7 million of fraudulently claimed food-aid money to The Free Minded Institute, ThinkTech Foundation, Haji’s Kitchen, The Produce LLC, Multiple Community Services, and Minnesota’s Somali Community.
On top of this, the indictments allege both Feeding Our Future and Sponsor A funneled a total of $28 million in fraudulently claimed food-aid money to Empire Cuisine, but the indictments aren’t clear about how much of that dollar figure went through Feeding Our Future and how much went through Sponsor A.
The indictments also identify an employee of Sponsor A by the initials “J.S.,” and accuse that person of allegedly using a shell company to receive $2.5 million in federal food-aid money from Sponsor A between October 2021 and January 2022.
Citing the federal indictments, attorneys for the Minnesota Department of Education named former Partners in Quality Care board member Julius Scarver in a September court filing. The state’s filing said Scarver had also worked for Partners in Quality Care in site support. The state accused Scarver of taking $13,400 in stolen food-aid money through The Free Minded Institute–a company he created that worked with Partners in Quality Care–and spending much of the money on restaurants, food, and liquor.
“Julius Scarver (referred to in the affidavit as J.S.), had a direct role in the fraud scheme through his shell company, The Free Minded Institute,” reads the education department’s filing.
In response to the education department’s claims, attorneys for Partners in Quality Care wrote in a legal filing that Scarver was a board member in August 2021.
“As a board member, Mr. Scarver had no ability or authority whatsoever to approve claims for reimbursement, nor was he individually involved in or specifically authorized to exercise any control over PIQC’s [Partners in Quality Care’s] finances or claims approval processes,” said Partners in Quality Care’s legal filing.
Scarver did not respond to an email message or a message left with a woman who answered the door at a home in St. Paul registered with The Free Minded Institute. The home is also listed as Scarver’s home address, according to court documents.
Partners in Quality Care named in May charges
Federal prosecutors first made the allegations against J.S. public in May when Empire Cuisine co-owner Abdiaziz Farah was charged with passport fraud as he allegedly tried to flee the country to avoid prosecution. Abdiaziz was also indicted on September 20 in the alleged financial fraud.
“The Free Minded Institute was created and controlled by Individual J.S., who is a member of the board of directors of Partners in Quality Care,” reads the May charges against Abdiaziz.
The passport fraud charges also say that transactions between Empire Cuisine, Partners in Quality Care, and The Free Minded Institute “suggest that Individual J.S. was going to be keeping approximately 5 percent” of the food-aid money from 150,000 meals that were reportedly served.
Why make allegations against J.S public in two charging documents without actually filing charges against him? Osler said there could be a number of reasons–one is that investigators don’t yet have the full picture of the alleged crimes J.S. is associated with, and are seeking more evidence.
“You can know that someone is taking kickbacks, but not know what the amount is, or who all they’re taking it from,” Osler said.
People who are accused of crimes in legal documents but who are not charged could be cooperating with investigators in exchange for more lenient sentences, he added. Or, charges against them could be just around the corner.
“The way that this has been structured is they’re charging a bunch of related conspiracies,” Osler said. “It’s not one big indictment that wraps everybody up. It’s several. And it could be that that individual is going to be in a different conspiracy that will be described in a new indictment.”
Another thing Partners in Quality Care has in common with Feeding Our Future, Osler noted, is engaging in aggressive legal tactics.
Less than two weeks before prosecutors announced the charges in the case, Partners in Quality Care filed its lawsuit to compel the Minnesota Department of Education to resume payments to the organization from federal food-aid programs. The department had halted Partners in Quality Care’s participation in the programs in January after the organization was named in search warrant affidavits unsealed that month unveiling the federal investigation.
Partners in Quality Care’s attorneys called the education department’s actions discriminatory. They accused the department of having a “vendetta” against the organization and using it as a “scapegoat” to make up for the department’s own “maladministration” of the federal funds.
Feeding Our Future sued the state in fall 2020 over similar actions and accused the education department of racial discrimination. That lawsuit was dropped earlier this year just after the allegations against Feeding Our Future went public in the January search warrants.
In legal filings responding to Partners in Quality Care’s lawsuit, attorneys for the state accused the organization of being “at the center of this fraudulent scheme.”
On Monday, October 3, U.S. District Judge John Tunheim denied Partners in Quality Care’s request for a restraining order that would have prevented the education department from terminating Partners in Quality Care’s participation in the food-aid programs.
“If Partners is indeed connected to the fraud, as the unsealed affidavits allege, MDE [Minnesota Department of Education] continuing to funnel money to an entity that knowingly or blindly served as a pass-through for the fraud is not in the public interest,” Tunheim wrote in his ruling.
A shared history and defense
The leaders of Feeding Our Future and Partners in Quality Care—Bock and Kara Lomen, respectively—were formerly close friends and business partners. They first worked together at the Minnesota Association for the Education of Young Children in the mid-2010s, where Bock managed accreditation for daycare organizations and Lomen trained and provided continuing education for daycare providers.
According to Sahan Journal’s prior interview with Bock in early 2022, incorporation papers, and police reports: In 2015, Lomen co-founded Partners in Quality Care; Bock joined the organization the same year. They also founded Feeding Our Future together in 2016 with a third business partner. But by 2018, the two had a falling out, and Lomen asked Bock to leave Partners in Quality Care. Bock took a hold of Feeding Our Future and ramped up its operations.
Lomen alerted state officials in 2020 to an alleged “fraud ring” centered around Feeding Our Future and Safari Restaurant. The restaurant’s co-owners were indicted in September.
Lomen and her attorneys did not respond to emails and phone calls seeking comment.
Feeding Our Future and Partners in Quality Care have taken identical strategies in defending the increasingly large amount of food-aid money they received. Both organizations have separately stated publicly that the rapid growth of food sites under their sponsorships reflected the need to feed hungry children at a time when schools were closed during the COVID-19 pandemic.
Luger pushed back against those assertions during his press conference last month.
“What’s public knowledge is that a lot of these school districts actually were continuing to serve meals during this fraud, and so these sites were not necessary,” he said.