Minneapolis daycare owner admits to defrauding taxpayers of millions through false childcare claims and pandemic meal reimbursements
MINNEAPOLIS, Minn. — Fahima Mahamud, the former CEO and owner of Future Leaders Early Learning Center in Minneapolis, pleaded guilty Thursday in federal court to wire fraud and conspiracy to defraud the United States. The case involves more than $5.5 million in alleged taxpayer funds stolen through two separate fraud schemes tied to Minnesota’s childcare assistance program and the high-profile Feeding Our Future scandal.
Mahamud admitted to submitting over 13,000 fraudulent claims to Minnesota’s Child Care Assistance Program (CCAP) between late 2022 and late 2025. Prosecutors say she falsified family co-payments and enrollment records, pocketing approximately $4.6 million while operating her daycare near George Floyd Square. The center received more state childcare assistance funding than any other provider in Minnesota last year, totaling $3.7 million.
In addition, Mahamud pleaded guilty to fraudulently claiming thousands of meals through the federal child nutrition program administered by Feeding Our Future. She received more than $850,000 for meals that were never served between late 2020 and early 2023. Much of the money was reportedly used to purchase real estate.
This marks the 68th conviction in the sprawling Feeding Our Future investigation, which exposed one of the largest fraud schemes in U.S. history involving roughly $250 million in misused pandemic relief funds.
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Daycare Closure and Flight Attempt Sparked Investigation
The case gained public attention after a viral video in December 2025 questioned enrollment numbers at Future Leaders Early Learning. State inspections followed, leading to the center’s closure in January 2026. Prosecutors previously alleged that Mahamud attempted to book a flight to London just days after shutting down the facility. She has been under house arrest since her arrest in February.
During Thursday’s hearing, Mahamud entered her guilty plea as part of an agreement with federal prosecutors. She faces a recommended prison sentence of three to seven years and must pay full restitution of approximately $5.5 million.
Broader Impact on Minnesota Childcare Fraud Cases
The plea comes amid heightened scrutiny of Minnesota’s childcare assistance programs. Authorities continue to investigate similar fraud cases across the state, with two women pleading guilty in separate childcare fraud matters on the same day. Critics have pointed to lax oversight during the pandemic expansion of federal and state aid programs as enabling widespread abuse.
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Minnesota officials and federal prosecutors have emphasized that funds intended to help low-income families access quality childcare and nutrition were instead diverted for personal gain. The scandal has eroded public trust in social service programs and prompted calls for stronger verification and monitoring systems.
Mahamud’s sentencing date has not yet been scheduled. The case is being prosecuted by the U.S. Attorney’s Office for the District of Minnesota as part of ongoing efforts to recover misused taxpayer dollars from the Feeding Our Future network.
