Fraud investigation is believing your lying eyes
bitsaboutmoney.com
bitsaboutmoney.com
The "50% fraud" claim? It comes from one investigator (Swanson) using what the OLA explicitly calls "a higher level view, a view that does not require the kind of proof needed in a criminal or administrative proceeding." His methodology? If kids are poorly supervised, "running from room to room while adult employees spend hours in hallways chatting".... he counts the entire payment as fraud. That's not "billing for phantom children" it's "I don't like how this daycare is run."
The OLA's actual finding: "We did not find evidence to substantiate the allegation that the level of CCAP fraud in Minnesota is $100 million annually." Proven fraud over several years was $5-6 million.
Terrorism? "We were unable to substantiate the allegation that individuals in Minnesota sent CCAP fraud money to a foreign country where a terrorist organization obtained and used the money." They checked with the U.S. Attorney's Office.. none of Minnesota's terrorism cases involved CCAP money.
McKenzie writes "beyond intellectually serious dispute" about claims the primary source he cites explicitly could not substantiate.
Meanwhile the president is posting videos of the Obamas as apes and calling Somalis "garbage", having federal prosecutors throwing out arbitrary $9 billion estimates in press conferences.
See for yourself: https://www.auditor.leg.state.mn.us/sreview/ccap.pdf
Page 14 of PDF:
[The OLA] did not find evidence to substantiate Stillman’s allegation that there is $100 million in CCAP fraud annually. We did, on the other hand, find that the state’s CCAP fraud investigators generally agree with Stillman’s opinions about the level of CCAP fraud, as well as why it is so pervasive.
(Stillman is a line level investigator who gave a media statement which was explosive. Swanson, who authored in the internal memo, was his manager.)
I do mention that other officials only agreed to characterize as fraud fraud which had resulted in convictions. We now, years later, have nine figures just from the convictions (and guilty pleas). These officials pointedly refuse to put any number on fraud other than the number incident to convictions.
Moreover: you should be very clearly correct if you accuse someone of citing a document as making claims it does not say. That is a serious accusation. BAM's citation of this piece is "the state’s own investigators believed that, over the past several years, greater than fifty percent of all reimbursements to daycare centers were fraudulent." This is _absolutely true_ and _is in the report as claimed_.
Spent about 30 minutes consulting the report you mention, OP's post, and your reply, and there's clearly issues.
In the essay, you wrote that industrial-scale fraud is "beyond intellectually serious dispute," cited the OLA report, and presented the 50% figure as the finding that "staggers the imagination." (this should have been a tell)
When challenged, you retreat to: "My citation that investigators believed this is absolutely true."
Those are completely different claims. "An investigator believed X" is not "X is beyond intellectually serious dispute" — especially when the same report on the same pages says:
- The OLA itself: "We did not find evidence to substantiate the allegation" (p. 5)
- The DHS Inspector General: "I do not trust the allegation that 50 percent of CCAP money is being paid fraudulently" (p. 12)
- The investigators themselves had "varying levels of certainty — some thought it could be less, and some said they did not have enough experience to have an opinion" (p. 9)
- Swanson explicitly used "a view that does not require the kind of proof needed in a criminal or administrative proceeding" (p. 10), counting the entire payment to any center with poorly-supervised kids as "fraud"
That's not "beyond intellectually serious dispute." It is, literally, a documented dispute, inside the very report you cite as settling the matter.
And "nine figures from convictions"? That's Feeding Our Future, a federal food nutrition program. The OLA report is about CCAP, a state childcare program. Proven CCAP fraud remains at $5-6 million. You're retroactively validating a CCAP claim with convictions from a different program.
But look at what's happened across this exchange:
Essay: Industrial-scale CCAP fraud is "beyond intellectually serious dispute." The evidence: the OLA report shows investigators believed 50%+ of reimbursements were fraudulent.
When challenged that the OLA explicitly could not substantiate $100M and proven fraud was $5-6M: you retreat to "my citation that investigators believed this is absolutely true and is in the report as claimed."
When challenged that "investigators believed X" ≠ "X is beyond intellectually serious dispute" — especially when the same report documents the IG saying "I do not trust the allegation," DHS leadership calling $100M "not credible," investigators having "varying levels of certainty" with some having "not enough experience to have an opinion," and the OLA itself saying "we cannot offer a reliable estimate": you pivot to FoF operator overlap.
You still haven't addressed the actual critique. The overlap proves that some fraudsters work across programs. Not disputed, not surprising, and consistent with your essay's point about fraud lifecycles. What it doesn't do is retroactively substantiate Swanson's 50% CCAP figure. His methodology, spelled out in the very email the OLA appended, counted all payments to any center where children were poorly supervised as 100% fraudulent, a standard he himself distinguished from "the kind of proof needed in a criminal or administrative proceeding." FoF fraud was fabricating meal claims for meals never served. CCAP fraud is billing for children not present. Different programs, different billing mechanisms, different oversight bodies (MDE vs. DHS), different proven scales by orders of magnitude. That some of the same people ran both doesn't collapse the distinction.
"CCAP is also funded by federal block funding" seems designed to blur a line that matters. Many programs are federally funded. That doesn't make convictions in one program evidence of the fraud rate in another.
Here's what's frustrating: I think the essay's core argument is genuinely strong, and it doesn't need the overclaim. The OLA report is already damning on its own honest terms: proven fraud of $5-6M in a program with paper sign-in sheets prosecutors called "almost comical," no electronic attendance verification, 60-day billing windows, a certification statement removed from billing forms in 2013, and the investigators themselves saying centers "open faster than they can close the existing ones down." The report makes it clear fraud was likely substantially higher than proven convictions. That's already a devastating indictment of program oversight. Your argument about base rates, weak controls, and Shirley fishing in a troubled pond all follows from that, from the report as it actually reads.
But "likely substantially higher than $5-6M, in a program with terrible controls" is a very different claim than "50%+ fraud, beyond intellectually serious dispute." Your essay presents the latter. The report supports the former. And the gap matters, because the essay is being read right now, today. in a context where the president is calling Somalis "garbage," prosecutors are throwing out $9 billion estimates in press conferences, and five states just had billions in child care funding frozen. Overstating what the evidence supports isn't a minor rhetorical choice in that environment. It's exactly the kind of epistemic failure the essay warns about when it talks about "irresponsible demagogues" filling the vacuum.
You keep wanting to make me "own" the CCAP's estimate. I will not reciprocally try to make you "own" $5 million, because I am charitable and because history has been unkind to the officials who made it.
I do ask you to own: "Minnesota HAS NOT suffered industrial-scale fraud across several social programs." Otherwise this is judging a high school debate competition, and I've had better.
No notes on the fraudsters pardoned by this current admin of course.
But your essay doesn't just claim fraud exists: it presents the 50% figure as the evidence that "staggers the imagination" and makes the case "beyond intellectually serious dispute." That's not parenthetical color. The paragraph is load-bearing on that number.
You charitably won't make me own $5M. I never claimed it. I've said in every reply the real number is likely substantially higher. My point has been the same throughout: you presented a disputed estimate as settled, from a report that explicitly could not settle it - in which the IG rejected it, DHS leadership called it not credible, the OLA said it "cannot offer a reliable estimate.", and the source themself named their lack of a standard beyond a vibe.
The essay is 5,000 words on why epistemic standards matter in fraud investigation. The critique is the essay's own standard, applied to the essay. You should apologize for the high school debate comment.
It's an insightful point, but it seems consistent with those epistemic standards that it's unimportant whether the 50% figure is valid in retrospect. The observation of "industrial-scale fraud" is sufficient to act, it doesn't need a retrospectively validated 50% figure and he would like you to get all the way off his back about it.
I am not. I am repeatedly enthused about it. You are in fact, parroting positive things I am saying about it.
I am on Hacker News, responding to him responding to a critic on a particular point.
But, on the other hand, I suppose intellectually serious dispute requires both sides to be intellectually serious. One good step in that direction would be to arrange one's citations such that they are supporting the claims you are citing them for.
I will also remark, as others have, that it's odd to make a big deal about this particular fraud when there's a lot more fraud happening a lot more obviously in a lot more of the nation. This is not to question Minnesota officials who are, rightly and appropriately, investigating suspected fraud in their zone of investigation; but it is worth questioning voices who have, apropos of nothing I can discern, made decisions about what's important to talk about and what isn't, and further made decisions to misrepresent allegations in alignment with people who very aggressively lie for evil reasons. As others have pointed out, the essay's core is seemingly cromulent, and it doesn't need you to do that.
You are welcome to your own opinion as to what could motivate a publication which routinely writes about fraud and finance to write about fraud and finance. Past issues you may enjoy include a year-long investigation into a single incident of fraud in NYC, a topological look at the fraud supply chain in credit cards, discussions of how the FTX fraud was uniquely enabled by their partner bank failing to properly configure their AML engine, and similar. </LLC voice>
https://en.wikipedia.org/wiki/Russian_occupation_of_Crimea
I guess it's now being used as pejorative against groups of vaguely military style. Like the DHS agents conducting Metro Surge.
(They haven't responded, and I've been downvoted for even asking the question. I am genuinely confused. I'll admit I don't follow this all very closely, but I want to understand what the phrase means here.)
That said, I described them as such because I considered the comparison to a masked and armed force of nebulous origin and ambiguous intention apt.
https://en.wikipedia.org/wiki/Little_green_men_(Russo-Ukrain...
> As a fraud investigator, you are allowed and encouraged to read Facebook at work.
I tend to believe this, but it would be a lot more compelling with links to a case where Facebook/TikTok posts were useful evidence.
In late 2024 there was the whole "Infinite money glitch" tiktok trend that was just check fraud.
https://www.youtube.com/watch?v=K0ck7hTsug8
"I just been swipin' for EDD
Go to the bank, get a stack at least
This ** here better than sellin' Ps
I made some racks that I couldn't believe
Ten cards, that's two-hunnid large"
(For context, "EDD" is California’s Employment Development Department.)
https://legalclarity.org/using-rap-lyrics-as-evidence-in-cri...
Dead Prez - Hell yeah: https://youtu.be/kGjSq4HqP9Y?si=_z6jb0Vfo7_PiITQ&t=82
Maxo Kream - 5200: https://www.youtube.com/watch?v=7kC9j6Zp-kg
Maxo was actually arrested for racketeering, though not due to this song specifically (I don't think).
I've also never heard of this report before this year as someone quite attuned to what happens in Minnesota.
One document contributor contends, notably, that if "adult “employees” spend hours in hallways chatting with other adults [...] the entire amount paid to that provider in a given year is the fraud amount."
I'll leave the assessment of that definition to readers. https://www.auditor.leg.state.mn.us/sreview/ccap.pdf
Leaving this to the conclusion does the piece a disservice. One can quibble (and it would be good to here) the extent to which the government isn't pursuing the sorts of fraud discussed, but this as a thesis makes clearer the argument throughout for earlier and more aggressive pursuit.
> And I think journalism and civil society should do some genuine soul-searching on how we knew—knew—the state of that pond, but didn’t consider it particularly important or newsworthy until someone started fishing on camera.
In... the same section where he cites all of the evidence the government has put together against the fraudsters. What is the issue? That these investigations should have been more prominently featured in the mainstream news? Would that have helped or hurt investigations?
> Of course, as the New York Times very carefully wordsmithed recently:
>> Minnesota officials said in early January that the state conducted compliance checks at nine child-care centers after Mr. Shirley posted his video and found them “operating as expected,” although it had “ongoing investigations” at four of them. One of the centers, which Mr. Shirley singled out because it misspelled the word “Learning” on its sign, has since voluntarily closed.
> An inattentive reader might conclude from this paragraph that the Times disputes Shirley’s reporting.
The New York Times is literally quoting what the Minnesota officials said. What were they supposed to do, add on "but a kid on YouTube says differently"?
I don't think the serious response to Nick Shirley's "journalism" is that there was no fraud; rather, it's that he came into the situation with a thinly veiled agenda and fed his audience exactly what they wanted to hear. Did his video make it more or less likely that we'll be able to investigate and resolve the fraud situation in MN? I guess that depends on how serious you think the laughably corrupt Trump administration is, but the fact that they seized on this as an excuse to send in 3000 ICE agents is not exactly promising.
Yes, there were some investigations and convictions, but nothing to on a scale that would deal with problem, nor any systematic change to a level paying huge amounts of money to scammers.
Second: I think one of the points Patrick misses is that fraud did indisputably occur, but that doesn't mean we need to treat Shirley as a neutral observer who simply cares about fiscal responsibility. (If I'm wrong, I eagerly away his next video on red state fraud.)
There was active prosecution ongoing literally right up until Shirly's video. That's taking the matter seriously.
[1] https://en.wikipedia.org/wiki/2020s_Minnesota_fraud_scandals
Oh yeah, the prosecution was sooo active that all the daycares listed as operational and receiving funding, had no kids in them, had blacked out or boarded up windows, misspelled signs, and if you went in to ask for enrollment 3 angry men would come out shouting at you. How many legit daycares have you seen that look like that?
Nick did a day worth of shooting, didn't follow up, and didn't check basic things like hours of operation.
Shirley gets acknowledged to have "poor epistemic standards" (which is an almost euphemistic way of describing his approach) but Patrick goes on to say that "the journalism develops one bit of evidence...." and even appears to insinuate the NYT erred in reporting it in the context of the Minnesota government's response that the state's own compliance checks had found them open shortly afterwards but that some of them were under investigation.
There's an interesting point to be made that detailed, bipartisan evidence collected by suitably qualified officials that some daycenters were closed at times they were claimed to be open gets less attention than a YouTuber with an agenda rocking up at nurseries at what may or may not have been their opening times, but that's not how it's actually expressed. Rather it seems to be arguing for face value judgements of his video and against journalists that felt compelled to point out that whilst evidence of daycare fraud by Somalis in Minnesota definitely existed, Shirley's videos probably shouldn't be considered part of it.
It's annoying that we're talking about this in these terms, because the article is about public services fraud, and it's mostly technical, and it's an interesting subject. We shouldn't have to debate Tim Walz to engage with it.
FTA:
> So-called “pay-and-chase”, where we put the burden on the government to disallow payments for violations retrospectively, has been enormously expensive and ineffective. Civil liability bounces off of exists-only-to-defraud LLC. Criminal prosecutions, among the most expensive kinds of intervention the government is capable of doing short of kinetic war, result in only a ~20% reduction in fraudulent behavior. Rearchitecting the process to require prior authorization resulted in an “immediate and permanent” 68% reduction. (I commend to you this research on Medicare fraud regarding dialysis transport. And yes, the team did some interesting work to distinguish fraudulent from legitimate usage of the program. Non-emergency transport for dialysis specifically had exploded in reimbursements—see Figure 1— not because American kidneys suddenly got worse but because fraudsters adversarially targeted an identified weakness in Medicare.)
But if you read the cited source of how Swanson came up with that number he said it wasn't just for over-billing (claiming more kids than the places actually had).
Instead, by his estimation, the employees working are not actually working because 'children are unsupervised, running from room to room while adult “employees” spend hours in hallways chatting with other adults' and so all of the funds to those providers are fraudulent. [1]
I think it's pretty easy to criticize the logic for that 50% fraud rate number without requiring criminal convictions.
[1] https://www.auditor.leg.state.mn.us/sreview/ccap.pdf#page=16
(I can't speak for Patrick's politics, only for mine.)
I don't even know where this belief comes from. I'm certainly not aware of any historical scenario where authoritarian regimes end when their opponents finally embody perfect behavior above reproach.
I doubt you yourself are engaging in bad faith (of course I recognize your username) but it's still a bad-faith demand to expect "completely on the ball" behavior above reproach and your intentions don't matter when you echo the demand.
For the author, it wasn't enough to simply recognize a failure to prosecute fraud fast enough, such a failure must be characterized as the cause of the irresponsible demagoguery that followed. Then turns around and wonders why his article isn't treated as the apolitical dissection of fraud that he claims it to be.
How are people finding ways to downplay or dunk on this? I just don't understand. What do I care how "apolitical" it is? I don't care. I do not care. The fraud is what we should care about. That's what the post is about.
When Charlie Hebdo was bombed and shot, I suppose what people should have been writing is a technical post about the poor quality of their work with tips on how to convey the same artistic point in a way that doesn't invite fanatics to bomb and shoot them, concluding that by not reining in their bad work they have ceded the field to people who will not be gentle in their proposals. Then you can comment things like "What do I care how apolitical it is? The art is what we should care about. That's what the post is about".
Edit: maybe a better analogy would be 9/11 with the US and Al Qaeda, where the US would be less innocent in your political sensibility than Charlie Hebdo and the dynamic I hypothesized was more real.
Important points throughout the article include: relatively little prosecution or enforcement occurred despite the awareness of rampant fraud; officials were naive to the common wisdom in fraud-prevention circles that people committing fraud in the past correlates strongly with the same individuals committing fraud in the future; "pay-and-chase" policies don't preempt funding flows to individuals suspected of fraud until it's established and feel the need to account for every fraudulent dollar instead of just blacklisting known bad actors the way that actual financial institutions do. FTA in particular, all emphasis FTA:
> For example, the primary evidence of a child attending a day-care was a handwritten sign-in sheet of minimal probative value. Prosecutors referred to them as “almost comical” and “useless.” They were routinely fraudulently filled out by a 17 year old “signing” for dozens of parents sequentially in the same handwriting, excepting cases where they were simply empty.
> To refute this “evidence”, the state forced itself to do weeks of stakeouts, producing hundreds of hours of video recording, after which it laboriously reconstructed exact counts of children seen entering/exiting a facility, compared it with the billing records, and then invoiced the centers only for proven overbilling.
> On general industry knowledge, if you are selected for examination in e.g. your credit card processing account, and your submission of evidence is “Oh yeah, those transactions are ones we customarily paperwork with a 17 year old committing obvious fraud”, your account will be swiftly closed. The financial institution doesn’t have to reach a conclusion about every dollar which has ever flowed through your account. What actual purpose would there be in shutting the barn door after the horse has left? The only interesting question is what you’ll be doing tomorrow, and clearly what you intend to do tomorrow is fraud.
Moving on,
> I don't think the serious response to Nick Shirley's "journalism" is that there was no fraud; rather, it's that he came into the situation with a thinly veiled agenda and fed his audience exactly what they wanted to hear.
My take is that there's no good reason to suspect that, except for holding an opposed thinly veiled agenda. And there is no serious dispute of the fact that billions of dollars of fraud occurred.
> Did his video make it more or less likely that we'll be able to investigate and resolve the fraud situation in MN?
It clearly made it more likely, as demonstrated by federal senate hearings that have extensively referenced the video (I've seen a segment where a senator literally had a prop photo of the "Quality Learing Center").
> the fact that they seized on this as an excuse to send in 3000 ICE agents is not exactly promising.
Your premise is that a YouTube video published Dec 26, 2025 somehow motivated a federal law enforcement action that commenced on Dec 4, 2025. Also, this claim conflates ICE with CBP. Also, per Wikipedia, out of thousands of arrests, only 23 have been of Somalis; and it's been abundantly clear in all the press functions that the targets have overwhelmingly been Hispanic — because they're overwhelmingly represented among illegal immigrants in the US, including in MN.
The surge of ~2,000 officers only happened around Jan 5-6, 2026. And this happened after the video in question was reposted by J.D. Vance and referenced by Kash Patel.
It's true that Operation Metro Surge as a whole started a month earlier. But, zooming out from that specific video, the operation was from the start motivated by the fraud scandal, according to reliable sources [1]. Official statements around this time of the later surge also referenced the fraud scandal [2]. Meanwhile, Trump delivered several speeches during this time complaining in racist terms about Somalis in general.
It's also true that the actual activity of Operation Metro Surge is mostly unrelated to the fraud. But that's the whole point! The administration seized on the fraud, and later seized on that specific video, as an excuse to send in ICE and CBP agents to do something completely different. As the parent said, this probably did not "make it more [..] likely that we'll be able to investigate and resolve the fraud situation in MN". Or if it did, it did so very inefficiently compared to other possible approaches such as getting the FBI to focus on it (which also happened). The surge did focus public attention on the issue, which might encourage local officials to resolve it. But it also massively poisoned the well. How much you want to talk about the fraud issue is now a proxy for how much you _don't_ want to talk about what liberals see as the much larger issue of abuses by ICE/CBP.
[1] https://www.nytimes.com/2025/12/02/us/politics/ice-somali-mi...
I don't get this. What does the proportion of blue fish have to do with the total number of fish you catch?
Is there some stats knowledge I'm missing?
The point the article is making is that the "reporter" turned up and alledged to have found nine cases of daycare fraud. Nine sounds like a lot, right? But the article claims the state already knew 50% of the daycares claiming its aid were frauds (this is quite debatable, don't take it as fact). Presumably that's 50% of hundreds or maybe thousands of daycares.
If blue fish were much rarer in the pond, i.e. lower percentage of daycares defrauding the government, you'd be considered a savant for fishing once and pulling out nine blue fish... but if the pond has thousands of fish and 50% are blue, it looks a lot less impressive.
The politicization of the issue means that Democratic Party aligned people continually flag any reference to the scam on HN though. If anyone else said that someone broke in and stole all the records from a daycare days after it was accused of fraud it would be considered a bald-faced lie but because of the political alignment (this is VP candidate Walz’s state) everyone is forced to pretend there’s no scam.
¹ Paradoxically the one honest juror who reported the bribe was removed from the case. No others reported any bribe which obviously must mean they received none.
These statements are trivially found using https://hn.algolia.com.
Or one could assume a vast conspiracy to explain the phenomenon.
1. The fraud is in fact being investigated, people are being charged and convicted. Despite this, rightwing media institutions are acting as if fraud is being ignored and maybe even covered up and encouraged because
2. This is just another example of the decades long project by those who have lots of money and don't want to see it go to takes to paint social programs as a money-pipe from good hardworking people to fraud and waste.
And as explained in TFA, this is inefficient and ineffective even in theory:
> So-called “pay-and-chase”, where we put the burden on the government to disallow payments for violations retrospectively, has been enormously expensive and ineffective. Civil liability bounces off of exists-only-to-defraud LLC. Criminal prosecutions, among the most expensive kinds of intervention the government is capable of doing short of kinetic war, result in only a ~20% reduction in fraudulent behavior. Rearchitecting the process to require prior authorization resulted in an “immediate and permanent” 68% reduction.
> Despite this, rightwing media institutions are acting as if fraud is being ignored and maybe even covered up and encouraged because
Which is a reasonable characterization of the situation given the scale of the fraud and the fact that it's still going on, in such a blatant manner.
We're talking about total fraud on the order of $10b, and some significant fraction of that money has presumably been sent back to Somalia. We're talking here about amounts that would represent a significant percentage of Somalia's entire GDP (https://en.wikipedia.org/wiki/Somalia#Economy).
> This is just another example of the decades long project by those who have lots of money and don't want to see it go to takes to paint social programs as a money-pipe from good hardworking people to fraud and waste.
"The left" clearly has a vested interest in that not happening; therefore, it is also in their interest to take appropriate actions against fraud as they might learn about from the financial industry.
1. The fraud was not in fact being investigated seriously enough until this kid, even while lacking the basics of journalism as Patrick describes here, forced the issue.
2. This is just another example of the decades long trend where more and more bad patterns and outcomes can persist for far too long because the normal checks are fended off with spurious accusations of racism.
There's some variation on how "the right" would handle (2). The center-right wants to shore up our culture of color-blindness to patch these vulnerabilities. The far-right wants to do away with egalitarianism altogether, and just go back to plain old racism. If we can't figure out the former, we might well end up with the latter.
(My reading is that Patrick falls squarely in the "center-right" here, fwiw. Then again, it can be hard to decode his exact subtext from under all the polite circumlocutions. Reading his stuff is something of an acquired skill and/or taste.)
In the real world, this maybe makes page 3 of the "crime" section of the newspaper for a single day.
Also, there are real dangers to blackpilling about fraud. "Everybody is doing it" is exactly what one says before doing fraud oneself. In reality, there are a lot of people out there doing the right thing every day.
There is literally nothing wrong with stating this, we ought not be political about this. There may also be conservatives being elevated from Fraud as well, all of it should be routed.
At this point it definitely warrants deep investigations, not more articles trying to destroy a 23 year old that went viral.
What it lacks is any concrete suggestion as to what should change, beyond some vague allusions that perhaps racial/ethnic profiling should make a comeback.
The real problem here though is that the entire article ignores the duty[1] the government owes its citizens.
It's "fine"[2] if stripe or visa or whoever flips a coin and if it's tails they decide this person isn't allowed to be a customer of their company. The company loses any profit they might have made and life goes on.
It's considerably more problematic when the government refuses to serve a citizen (or even worse, levies an accusation).
There's some famous quotes about how many innocent people are appropriate to harm in the pursuit of the guilty but I'll leave those up to the reader.
[1] duty feels like too weak of a word here. Obligation? Requirement? The only reason the government even exists is to benefit the citizens.
[2] it becomes rapidly less fine when the company essentially has a monopoly over a system requires to participate in modern life, but that's a different topic...
That's the real thing here. Concentrated power is scary-- whether it's the federal government, Visa/Mastercard, Google, etc.
At least power concentrated under the control of a government might be held accountable to the people. With private, concentrated power: fat chance.
If that leads to bad outcomes, then government is a next best choice.
(Of course, all the special cases, natural monopoly, etc etc etc-- government has a role in addressing the bad outcomes associated with those).
>"Responsible actors in civil society have a mandate to aggressively detect and interdict fraud. If they do not, they cede the field to irresponsible demagogues. They will not be careful in their conclusions. They will not be gentle in their proposals. They will not carefully weigh consequences upon the innocent. But they will be telling a truth that the great and the good are not.
The public will believe them, because the public believes its lying eyes."
"If you don't do <fascist thing> now, the real fascists will take over!"
From this piece, it seems like the state auditor detected some fraud, but there was little follow-up from either the state or 'responsible journalists', so the sensationalists came in with a (predictably) extreme take, after which everyone started slinging mud. The sensationalism could have been forestalled by better auditing by the state, or journalism by large-scale media. I am not sure what part of this is fascist.
So again, now what? Are they supposed to hire more investigators? Work harder? Require less evidence? What part of the system is supposed to change and how?
is fascistic, because being aggressive hurts those that want to do it right but are not trusted. an aspect of fascism is to not trust its own people.
as far as i can tell trump is all about not trusting people but aggressively enforcing arbitrary rules no matter the cost. exactly what i am criticizing.
Why is it so difficult for people to acknowledge that Minnesota fucked this up badly? What is that going to cost us? The attempts to downplay it seem pretty delusive.
As the article literally says, a whole bunch of people got sent to prison, that seems like pretty solid evidence.
The question is: now what?
Fraud targeting social welfare programs is a grave crime; it strikes at public support for those programs. It enriches criminals very specifically at the expense of those people who would most benefit from the program.
If you've been reading the news then you can decode these paraphrases, but they do make his articles significantly harder to read.
I'm tempted to ask an LLM to replace them with more straightforward references.
The reason why risk departments all inevitably reinvent Maoism is because the only effective enforcement mechanism they have is to refuse service. Fraudsters are fundamentally illegible to businesses of this size. And as the article stated, recidivism rates in fraud are high enough that someone caught doing fraud should never be given the time of day ever again. So the easiest strategy is to pick some heuristics that catch recidivist fraudsters and keep them a jealously guarded secret.
This calculus falls apart for the government. If someone rips the government off, they can arrest them, compel the production of documents from every third party they've interacted with, and throw them in jail where they won't be able to rip anyone else off for decades. Obviously, if we gave the Risk Department Maoists these same permissions, we'd be living under tyranny.
Well, more tyranny than we already live under.
But at the same time, the fact that we have these legal powers makes Risk Maoism largely obsolete. We don't need to repeatedly reinvestigate the same people for the same crime "just in case".
Right now we have either some form of fine, and while this can be incredibly painful, usually is not, then we go straight to like multiyear prison sentences, with perhaps a few suspended sentences in between there.
I dunno, maybe a world where "you did a small bank fraud so now you have some kind of antifraud system attached to you" is genuinely worse than the one we live in now, but the idea of being able to target more specific aspects of someone rather than just prison/not prison seems interesting.
I guess we have stuff like "not allowed to use a computer for 5 years" (thanks hackers movie!), dunno how effective or practical that is.
How is it Maoist to refuse service???
> This calculus falls apart for the government.
It really doesn't. The judicial process is expensive and jail time isn't at all proportional to the amount defrauded (especially not when there is no political appetite for locking up a disproportionately "racialized" set of culprits, never mind the facts); nor does it solve the problem of recovering those funds. Further, the projections on the amount of fraud uncovered make it seem rather likely that a high percentage of those responsible are going free.
> We don't need to repeatedly reinvestigate the same people for the same crime "just in case".
The entire point of the system you're calling "Risk Maoism" is that it does not involve reinvestigation; it involves a presumption that reinvestigation would be a waste of time.
It suggests nothing of the sort, and in fact explicitly attempts to establish that none of this is intrinsic to any affinity group. The point isn't that the fraudsters in this case were of a particular ethnicity; it's that they shared an ethnicity, which enables the kind of internal social trust that fraud rings require.
Further, it suggests many clear heuristics that are nothing to do with ethnicity. The suggestions are clear and explicit; they just happen to involve occasionally denying services without proof of already-committed fraud, which you apparently consider unacceptable. But here is an experienced person telling you from expertise, with abundant citations and evidence, that nothing else really works, and furthermore that this is common knowledge in a well established industry specifically devoted to the problem.
Does Patrick want to address the fact that this happened during school break and that Nick Shirley didn't prove much of anything?
It's very annoying that I feel like I have to say this but: I'm a committed Democrat, and I feel like my anti-Trump anti-racism bona fides, including on this site, are quite solid. The Minnesota thing happened. We can debate the scale, but it happened.
Yes, fraud is bad. I agreed before I read the article.
I've learned (from the article) that there was apparently some fraud in Minnesota, some of which was successfully prosecuted and, possibly, some that wasn't.
If pressed, I would say the take away from the article is that the fraud investigators should have been more willing to use race/ethnicity and accept a lower standard of evidence before taking action.
Is there something I'm missing?
The government has the power to ruin your whole life, so it's reasonable that they have high standards of evidence to ruin your life. But if they can't secure a conviction they do nothing, they'll let you open another NGO and apply for another government grant as if nothing happened.
A business has the power to inconvenience you by refusing to do business with you. That's less ruinuous than what the government does so it's OK that their standards of evidence are lower.
But perhaps there should be something that the government can do in between nothing at all and ruining your life. Otherwise the same frauds will happen again and again.
This is not a fair or reasonable conclusion from what the article actually says.
Ideally, state programs should:
1. not pay out until a beneficiary's bona-fides are first verified. Paying out first, with no verification, and only retrospectively trying to claw back fraudulent claims, only after expensive investigations, is ruinous on the state budget.
2. work with private industry to identify alleged fraudsters
3. require much more verification of alleged fraudsters before agreeing to pay anything out
4. snoop around to find fraudsters' abettors because they're easier to find than the fraudsters
Other than one section saying that fraud investigators should expect to find ethnic clusters (because fraudsters of all ethnicities use their families and friends), there's nothing about ethnicity being a "flag". The biggest flag is that the same person previously committed fraud, and the article laments that civic government often gives a "clean sheet" to known fraudsters, in a way that the finance industry never would.
Democrats have rationalized much worse things than this, for example the ethnic cleansing (genocide) in Gaza. So with all due respect frankly I'm not at all assuaged by your caveat.
From this we can conclude many things. Maybe the thief was very crafty. Maybe the local police are incompetent. Maybe everyone is trying their best and the job of going after bike thieves is very hard.
But you cannot ever convince me that an appropriate conclussion could be "your bicicle didn't actually get stolen". I saw it. I can't identify the thief, there will never be a conviction, but don't tell me it didn't happen.
A conviction in a court of law is very important to be able to confidently say "so-and-so has committed fraud". But requiring a criminal conviction just to be able to say that fraud has happened is lunacy.
I too have had a bike stolen and it was an incredibly awful experience, but I'm not going to vote for a law requiring us to execute people accused of bike theft.
This is what is so incredibly frustrating about these types of conversations because so frequently you have one side proposing fact based strategies developed via reaearch and experiments and historical analysis and so forth, but that makes them quite complicated to explain in 30 seconds on tv, and on the other side you have some asshole going "all these problems are caused by <subgroup> and if you give me power I'll be cruel to them and everything will be better".
The latter's simplicity seems to be highly appealing and attempting to argue against it using facts and logic requires A) the listeners to actually respect facts and logic and B) and lot more effort to research/cite/develop the facts and logic.
So again, it sounds like fraud happened. This is bad. Some people were imprisoned because of it. Now what?
I keep asking this basic question because that's whats actually missing from the article.
Is there a specific person who should be in prison but isn't? Is there a law that could be passed to make fraud harder? What, specifically should be done?
What if this article is just the rationalist version of the Nick Shirley hit piece?