Democratic Minnesota Gov. Tim Walz on Friday unveiled a new statewide fraud prevention program in the state's latest effort to crack down in the wake of the Feeding Our Future scandal — a scheme that siphoned away $250 million in taxpayer funds meant for hungry children.

Walz, the one-time Democratic running mate to former Vice President Kamala Harris, named Tim O'Malley as the new director of program integrity in a news conference on Friday morning. 

O'Malley is former FBI agent who previously led the Minnesota Bureau of Criminal Apprehension, appointed by Republican Gov. Tim Pawlenty. He had also served as a chief judge on the state's Court of Administrative Hearings, appointed by Walz, and has worked with the Archdiocese of Saint Paul and Minneapolis in an integrity-related capacity.

"[O'Malley] will work across state government to strengthen fraud protection and protect taxpayer dollars," Walz said. "Tim made this clear yesterday as we were talking: he does not work for me, he works for the people of Minnesota as all of us do, and in fact he was so clear about that is he wanted to make sure that he rewrote the press release that went out to make sure that it reflects not a reality that we may craft, but the one that's truly there."

O'Malley said the governor privately assured him he'd have "the freedom and autonomy to act to do whatever is necessary to solve this."

"I'm not here to serve any individual, and I'm not here to serve a political party. I'm here to serve Minnesotans," O'Malley said.

Walz said the fraud prevention program was built with help from an outside forensics company called WayPoint, led by forensic accountant and attorney Josiah Lamb. 

"In our current capacity, we are working with the BCA to build out this anti-fraud toolkit, which will include policies and procedures specifically designed to address fraud risks, that can be utilized enterprise-wide to help prevent fraud in the future," Lamb said.  

The governor said the state's contract with the company is valued "up to $200,000" and "will be spread across all the state agencies."

Walz says he takes "responsibility" for fraud, defends his COVID policies

The Feeding Our Future scandal, the nation's largest COVID fraud scheme, has garnered renewed focus from the Trump administration, prompting a surge of federal immigration enforcement activity in Minnesota and fueling the talking points of his Republican gubernatorial challengers.

In response to Walz's announcement on Friday, candidate and current GOP state Rep. Kristen Robbins said the governor's fraud prevention program "should be his resignation."

Republican State Sen. Jordan Rasmusson said, in response to the announced program, a "statewide director of program integrity isn't something you need when your commissioners are doing their jobs well in the first place." Resmusson added that Minnesotans "expect their government to provide vigorous oversight of our welfare programs."

On Friday, Walz said Minnesota's "generosity" was "taken advantage of by an organized group of fraudsters and criminals," and he'll "take responsibility" for the failures that led to the massive COVID relief funding theft, admitting his office "should have been keeping Minnesotans more up to speed on what was happening."

"We have and have just like in COVID, just like in every other situation, I take full responsibility for it. I think, and I will acknowledge certainly to Minnesotans and to the press here, I don't think we've done a good enough job of communicating the hard work has been done," Walz said.

He also said the "guardrails were taken off" by the federal government during the pandemic and "the guidance was to move the money."

"Our goal was to make sure we were moving that money so that people ate, that they were housed, that they had vaccines, but it also opened up the door to relax the guardrails and to have fraud be committed," he said.

While taking blame for the fraud scandal, Walz also said his attempt in 2021 to freeze funding for a Feeding Our Future-related organization was thwarted by the courts.

"I said, 'Don't pay them,' and they said, 'You can't do that, you don't have that authority.' I said, 'Do not pay them, let them sue me.' They did and they won, and we paid them, and then they got caught and went to jail after the fact," Walz said.

Walz also defended his COVID policies that critics branded as draconian, leading to multiple — and ultimately unsuccessful — lawsuits, including over mask mandates.

"I will not apologize for making Minnesota one of the safest states during COVID," he said.

In September, Acting U.S. Attorney Joseph H. Thompson said alongside the Feeding Our Future case, fraud connected to the state's Housing Stabilization Services and autism services "has stolen billions of dollars in taxpayer money."

Walz recently announced new audits on up to 14 social programs in Minnesota that officials consider "high risk" for fraud. An official at the state Department of Human Services told WCCO the inspector general's office is currently reviewing more than 1,300 reported cases of fraud in those programs, and has recovered some $50 million. 

Walz: Trump's targeting of Somalis is "racially motivated"

President Trump's recent focus on Somali-American Minnesotans, whom he labeled "garbage," appears to be tied to the Feeding Our Future case.

There are now upwards of 80 defendants in the case, many of whom are of Somali descent, though the group's founder and alleged mastermind, Aimee Bock, is White. So far, 61 people have been convicted, with more investigations underway. 

U.S. Census Bureau data show more than 107,000 people identified as Somali across Minnesota, with more than 80,000 living in the Twin Cities. 

Earlier this month, Mr. Trump called Minnesota a "hub of fraudulent money laundering activity," with his administration now investigating whether stolen funds were funneled to the Somali-based al Qaeda affiliate Al Shabaab.

And in recent weeks, the Department of Homeland Security has sent dozens of federal agents to Minnesota, specifically the Twin Cities, as part of "Operation Metro Surge." Mr. Trump also previously ordered all green card holders from Somalia and more than a dozen other countries be reexamined, adding that he would end the temporary protected status for Somalis in Minnesota.

On Friday, Walz said the president's actions do "nothing to either address immigration" or "fraud."

"The absolute recklessness of doing some of this and the targeting of a specific community, unconscionable," Walz said. "It is very specifically aimed and very racially motivated towards a Somali community that matters greatly here."

Walz also applauded comments made by GOP state Sen. Jim Abeler, who recently wrote a letter to Mr. Trump rebuking his statements about Minnesota's Somali community.

"I'd like to acknowledge that just the basic decency, not a surprise to everybody in here has been, but Sen. Jim Abeler's willingness to stand up, and note that it should be the simplest thing in the world," Walz said. "When the president of the United States calls an entire group of people garbage and our state garbage and a hellhole, to just disavow that, you can still be very conservative."

High-end cars, luxury vacations, overseas transfers

Newly released evidence also gives the clearest look yet at how the Feeding Our Future fraudsters blew through hundreds of millions of dollars meant to feed Minnesota children during the pandemic. 

CBS News obtained dozens of trial exhibits, and they reveal luxury vacations, high-end cars and overseas transfers, all funded by taxpayer dollars meant to feed kids in need. 

Photos and documents show fraudsters booking over-water villas in the Maldives, buying gold jewelry in Dubai and sending stacks of cash overseas.

Some defendants purchased lakefront property in Minnesota, first-class airline tickets and luxury cars.

U.S. Attorney Daniel N. Rosen said it's more evidence that the main driver for the fraud was greed.

"Massive. Order of magnitude larger than just about any fraud that's ever been prosecuted in the United States," he said. "What we can say from that enormous volume of evidence is that the predominant motive of all of these individuals was their self-enrichment and their self-indulgence. And that's where they spent the money overwhelmingly."

There is also evidence of money going overseas, including to China.

This story will be updated.