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Eight Charged in $281 Million Minnesota Housing Program Fraud Scheme: ‘First Wave’ of Federal Cases

(KNSI) – Eight people have been federally charged with wire fraud in connection with a massive scheme that drained millions of dollars from Minnesota’s Housing Stabilization Services program. 

According to Acting U.S. Attorney Joseph H. Thompson, the charges represent “the first wave” in what appears to be widespread fraud targeting a program designed to help Minnesota’s most vulnerable residents find and maintain housing. 

The Housing Stabilization Services program launched in July 2022, making Minnesota the first state to offer Medicaid coverage for housing assistance. The program was intended to help people with disabilities, seniors, and those struggling with mental illness and substance abuse disorders by providing housing consultation, transition services, ongoing support, and moving assistance. However, federal investigators say the program’s design made it vulnerable to fraud.

 With low barriers for new providers and minimal requirements for reimbursement, the system lacked basic safeguards like requiring service notes for payment claims. 

Originally projected to cost about $2.6 million per year, the program instead paid out over $42 million in 2022, $74 million in 2023, $104 million in 2024, and another $61 million in just the first six months of 2025. 

Investigators found that fraudulent providers would acquire names of eligible beneficiaries, often from addiction treatment centers, then submit inflated or completely fake reimbursement claims for services that were never provided or greatly exaggerated. 

The eight defendants charged include four men connected to Brilliant Minds Services LLC: Moktar Hassan Aden, 30; Mustafa Dayib Ali, 29; Khalid Ahmed Dayib, 26; and Abdifitah Mohamud Mohamed, 27. 

Between September 2022 and April 2025, their company submitted claims totaling approximately $2.3 million, making it one of the top ten highest-billing providers statewide in 2024. Each defendant allegedly pocketed between $300,000 and $400,000, and the group ran up nearly half a million dollars on a shared Platinum American Express card paid for with company funds. 

Christopher Adesoji Falade, 62, and his son Emmanuel Oluwademilade Falade, 32, operated Faladcare Inc. and are accused of receiving over $2.2 million for services supposedly provided to about 100 beneficiaries, far exceeding what they delivered. 

Brothers Asad Ahmed Adow, 26, and Anwar Ahmed Adow, 25, ran separate companies but employed similar tactics. Asad’s company Leo Human Services allegedly received $2.7 million based on claims for about 250 beneficiaries, with proceeds used to invest in Kenyan real estate and lease a 2024 BMW X4. Anwar’s Liberty Plus received more than $1.2 million for services claimed for approximately 200 beneficiaries, and he allegedly used the money to lease a 2023 Mercedes-Benz CLA and make investments. 

“What we see are schemes stacked upon schemes, draining resources meant for those in need,” Thompson said. “I have spent my career as a fraud prosecutor and the depth of the fraud in Minnesota takes my breath away.” 

Law enforcement officials emphasized that the fraud not only wastes taxpayer money but also deprives vulnerable populations of critical services during ongoing housing and addiction crises. 
Federal wire fraud carries a standard penalty of up to 20 years in prison, fines, and restitution for victims. 

Since 2018, Minnesota has experienced significant fraud activity. The Medicaid Fraud Control Unit alone has charged over 100 people. The massive $250 million Feeding Our Future case involved more than 70 defendants. Roughly $200 million has been stolen from Frontline Worker Pay. 

Tens of millions have been taken from Medicaid services. At least $6 million was stolen from the Child Care Assistance Program. Additionally, $400 million was taken from autism and Early Intensive Developmental and Behavioral Intervention treatment programs. 

A bipartisan plan for the creation of a state Office of Inspector General failed to pass during the 2025 Minnesota Legislative session.