Since 2022, Kenya has featured prominently in courts in the US state of Minnesota for all the wrong reasons.
This is because it was the destination for some of the $300 million (Sh38.7 billion) stolen from US taxpayers in the name of reimbursements for feeding vulnerable Minnesota children during the Covid-19 pandemic.
Multi-million assets in Nairobi and a beach property at Coast are among properties bought using the money, and the US is targeting some of them for seizure.
The story was made public in September 2022 when 47 people were indicted by the Attorney’s Office for the District of Minnesota over the scam perpetrated through a non-government organisation called Feeding Our Future. They included the organisation’s founder and executive director, Ms Aimee Bock, and one Salim Said who was said to be her co-conspirator.
Last month, when the US Department of Justice (DoJ) gave an update on the matter, the number of those indicted had reached 77. By then, some of the suspects had been found guilty or convicted by their own plea of guilt.
One of them is Liban Yasin Alishire, who had – in January 2023 – pleaded guilty to his role in the scheme. By pleading guilty, he agreed to forfeit numerous assets, including “an apartment unit in Nairobi, Kenya, and the [Sh27.9 million] Karibu Palms Resort on the Indian Ocean in Kenya” as indicated by the DoJ in a press release.
An aerial view of Karibu Palms Resort, Diani beach. A property at the hotel is part of what Liban Alishire has agreed to forfeit after pleading guilty to fraud in the United States.
Photo credit: Pool
Another one is Abdiaziz Shafii Farah who went to the US as a refugee. In June 2024, he was convicted by a jury of various offences. Four months ago, United States District Judge Nancy E. Brasel sentenced the 26-year-old to 28 years in prison, which will be followed by three years of supervised release.
“Farah laundered the fraud proceeds through China. This overseas money is beyond the reach of American law enforcement. Neither these funds nor Farah’s international real estate holdings have been, or can be, seized or forfeited,” said the DoJ in a statement four months ago.
This was a concession that the world’s most powerful country can never seize Farah’s properties acquired outside its borders.
The Nation reached out to the DoJ for a comment on the progress of seizing the property owned in Kenya by the various convicts. By the time of going to press, the department had not replied.
What, really, is this “Feeding Our Future” scam?
To grasp the story, one needs to go back to 2020, the year when Covid-19 brought the world to a standstill. As Covid bit, US authorities paid special attention to the Federal Child Nutrition Programme.
While this had noble intentions, a DoJ statement issued in 2022 explained how this turned into a monumental scandal.
“The Federal Child Nutrition Program, administered by the US Department of Agriculture (USDA), is a federally-funded program designed to provide free meals to children in need. The USDA’s Food and Nutrition Service administers the program throughout the nation by distributing federal funds to state governments,” it said in a statement.
It added that in Minnesota, the Minnesota Department of Education (MDE) administers and oversees the Federal Child Nutrition Program.
From left: Abdiaziz Farah, Abdimajid Nur, Hayat Nur, Mohamed Ismail, Mukhtar Shariff, Abdiwahab Aftin and Said Farah. (Background) Karibu Palms Resort in Diani which convict Liban Alishire bought using part of his stolen Sh315m.
Photo credit: Pool
“Meals funded by the Federal Child Nutrition Program are served by ‘sites’. Each site participating in the programme must be sponsored by an authorised sponsoring organisation. Sponsors must submit an application to MDE for each site. Sponsors are also responsible for monitoring each of their sites and preparing reimbursement claims for their sites. The USDA then provides MDE federal reimbursement funds on a per-meal basis. MDE provides those funds to the sponsoring agency who, in turn, pays the reimbursements to the sites under its sponsorship. The sponsoring agency retains 10 to 15 percent of the funds as an administrative fee,” DoJ added.
This is where the organisation Feeding Our Future fitted in. It was recognised as a sponsor under this arrangement. Whereas the USDA was stringent on reimbursing sites that were feeding children, it relaxed some of those rules in the face of Covid.
“Among other things, the USDA allowed for-profit restaurants to participate in the programme, as well as allowed for off-site food distribution to children outside of educational programs,” DoJ said.
Ms Block, who has since been found guilty of taking part in the scam, saw an opportunity. Suddenly, DoJ said, the disbursements to her organisation shot up from $3.4 million in 2019 to nearly $200 million in 2021.
By the time the authorities sensed something was amiss, Feeding Our Future had recruited various people to open up sites. And money was flowing in in torrents.
“These sites… fraudulently claimed to be serving meals to thousands of children a day within just days or weeks of being formed,” said the DoJ.
Defendant Said Shafii Farah walks into US District Court in Minneapolis with his attorneys on the first day of jury selection in the first Feeding Our Future case to go to trial.
Photo credit: Leila Navidi | Reuters
False documents, made up names of children, inflated numbers, fake attendance rosters were among the conduits of the scam. It took a while before this was stopped. DoJ termed it a “fraud scheme that exploited a federally-funded child nutrition program during the Covid-19 pandemic”.
“Despite knowing the claims were fraudulent, Feeding Our Future submitted the fraudulent claims to MDE and then disbursed the fraudulently obtained Federal Child Nutrition Program funds to the individuals and entities involved in the scheme,” the DoJ added.
“In total, Feeding Our Future opened more than 250 sites throughout the state of Minnesota and fraudulently obtained and disbursed more than $240 million in Federal Child Nutrition Program funds. The defendants used the proceeds of their fraudulent scheme to purchase luxury vehicles, residential and commercial real estate in Minnesota as well as property in Ohio and Kentucky, real estate in Kenya and Turkey, and to fund international travel.”
Abdiaziz Shafii Farah, described by DoJ as a “scheme leader”, defrauded American taxpayers at least $47 million (Sh6 billion) from alongside other suspects.
A DoJ statement following his sentencing said that besides the 28 years in jail, he will be required to pay $47,920,514 in restitution.
“Farah was the co-owner of Empire Cuisine & Market, an entity that he enrolled in the Federal Child Nutrition Program in April 2020, during the early days of the Covid-19 pandemic. Farah was among the very first defendants to see an opportunity for fraud and exploit it. Farah immediately opened a number of fraudulent program sites and began falsely claiming to serve meals to thousands of children per day. Many of the purported ‘sites’ served no meals at all and were nothing more than parking lots or vacant commercial spaces,” said the DoJ.
FBI agents raid the nonprofit organization Feeding Our Future in St. Anthony, Minnesota on January 20, 2022.
Photo credit: Reuters
When Farah’s property was searched following a court warrant in January 2022, his passport was seized. The DoJ said that two months later, he went to the Minneapolis Passport Agency in downtown Minneapolis to apply for a new US passport.
“Farah lied on his passport application, falsely claiming his passport was lost, rather than seized by federal agents. Farah obtained a new US passport that day. Less than two weeks later, Farah attempted to leave the country, purchasing a one-way ticket to Kenya, where he owned property paid for by the taxpayer money he stole. Law enforcement acted quickly to charge Farah with passport fraud and take him into custody,” said the DoJ.
Judge Brasel had no kind words for Farah as she handed him his sentence. Noting that he went to the US as a refugee, she said it was “ironic at best that, as the government aimed no child went hungry during the pandemic, you saw the opportunity to fraudulently make money”.
In arguing for a long sentence, Acting US Attorney Joseph H Thompson said Farah had thanked Americans who gave him a home, citizenship and a free college education by “robbing us blind”.
The other person jailed for the scheme, Liban Yasin Alishire who pleaded guilty to the scheme, used to live in Brooklyn Park. He enrolled two firms – Community Enhancement Services and Lake Street Kitchen – to benefit from the Federal Child Nutrition Program under Feeding Our Future.
“Alishire admits that after enrolling in the Federal Child Nutrition Program, he began submitting fraudulent claims for reimbursement for serving meals to hundreds or thousands of children a day,” said the DoJ, adding that he received more than $1 million (Sh128.9 million) through the scheme.
“On or about November 22, 2021, Alishire conducted a wire transfer of $216,300 (Sh27.9 million) … towards the purchase of the Karibu Palms Resort in Diani Beach, Kenya,” the DoJ said.
Another person who has been convicted in the scheme is 24-year-old Abdimajid Mohamed Nur, who was last month handed a 10-year prison sentence. He is also required to pay $48 million in restitution. He participated in the scheme through Empire Cuisine & Market, which the DoJ described as “a small storefront halal market”.
“Empire Cuisine enrolled in the Federal Child Nutrition Program in April 2020 — during the early days of the Covid-19 pandemic and within weeks of registering the company with the Minnesota Secretary of State. Nur and his co-conspirators immediately opened several federal child nutrition program sites and began claiming — falsely — to be serving meals to thousands of children per day. These claims were fraudulent,” said the DoJ.
“Nur and his co-conspirators engaged in a conspiracy to launder the proceeds of their fraud scheme using a series of shell companies both in the United States and Kenya,” it added.
Besides splurging the ill-gotten wealth on items like a Sh8.2 million Dodge Ram pickup and a Sh4.5 million Hyundai Santa Fe, he also bought Sh3.9 million worth of jewellery in Dubai, went to a honeymoon in Maldives, and paid millions to proxies to take exams for him which enabled him to get an online college degree.
As more and more suspects are nailed for the scheme, the last has not been heard about how Kenya was involved in the laundering of the money.
