Scammers target Hennepin County fund meant to aid businesses impacted by ICE surge
Data shows small businesses lost hundreds of millions of dollars in revenue during Operation Metro Surge. A Hennepin County program launched to help them ended up shutting down. Nearly half of the applications for taxpayer-funded recovery money were fake.
"We caught the fraud before we spent any money," Hennepin County Commissioner Jeffrey Lunde said.
Lunde says it was an unfortunate win. In March 2026, Hennepin County Commissioners approved $2 million to help small businesses cover rent or mortgage payments as Operation Metro Surge kept customers away.
"We originally allocated $2 million," said Lunde. "Part of that was administrative and then the rest was for grants, to put money into people's hands."
Eighty-two grants were sent out with the help of a nonprofit the county hired to oversee the program.
"It was short of $2 million that we ended up saying, 'You know what? We're getting diminishing results. We were finding more and more fraud.' We just said, 'OK, we're just gonna stop,'" said Lunde.
When WCCO asked for an example, he said, people were "Applying all the information for that company except the phone number and name is not."
WCCO spoke with one legitimate Bloomington, Minnesota, business owner who received $10,000 from the program.
"Rent doesn't wait. Bills don't wait," Gilberto Diaz, who owns Luro Boots, said.
Diaz had a message for the scammers.
"It is sad. When I was hearing this, I was upset because they don't know the damage they do to a small business," he said.
"We need to prosecute some people. People need to be held accountable," Lunde said.
The Hennepin County Sheriff's Office says they were asked to review the situation. Investigators requested materials to begin an investigation.
"I think we're gonna need the legislature to take a look. Do we have some of the right laws to prosecute these people?" Lunde said.
$1 million of that unused grant money is still available for small business financing needs. Another 500,000 will be used to provide consulting and promotional support for businesses.
