Pennsylvania men guilty in AI fraud scheme targeting Minnesota housing program

Two Pennsylvania males admitted to repeatedly touring from Philadelphia to Minneapolis in an try and defraud the Minnesota Housing Stabilization Companies (HSS) program, prosecutors introduced. The lads are alleged to have defrauded roughly $3.5 million from this system and used synthetic intelligence to create false information.

The 2 males, recognized as Anthony Waddell Jefferson, 37, and Lester Brown, 53, allegedly arrange companies in Minnesota and registered as HSS suppliers. The lads would supply housing counseling, transition and assist providers to eligible people.

The state’s HSS program, which formally launched in July 2020, goals to assist individuals with disabilities, together with seniors and people with psychological sickness or substance abuse, discover and preserve housing. The Ministry of Justice beforehand stated this system had “low limitations to entry and minimal registration necessities for reimbursement.”

Lawyer Normal Pam Bondi responded: “Legal fraud does not simply rob taxpayers – it erodes belief in our establishments. Beneath President Trump’s management, as we speak’s convictions are just the start. Our prosecutors will work tirelessly to unravel legal fraud schemes and convey perpetrators to justice in Minnesota and throughout the nation.”

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The Mississippi River is seen in entrance of the Minneapolis skyline on February 7, 2025. (Matt McClain/The Washington Submit by way of Getty Photographs)

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Jefferson and Brown are accused of stealing roughly $3.5 million from HSS for providers they falsely claimed to have supplied to roughly 230 Medicaid beneficiaries. The lads every pleaded responsible to 1 rely of fraud and resist 20 years in jail, the DOJ stated.

“Minnesota will not be a haven for fraud below our watch,” stated Deputy Lawyer Normal Todd Blanche. “The Division of Justice has investigated billions in tax fraud nationwide and has efficiently convicted 66 people in Minnesota. The collaboration between the Legal Division and the U.S. Lawyer’s Workplace is a good instance of how we’re restoring justice and public belief whereas holding legal fraudsters accountable.”

Deputy Lawyer Normal Todd Blanche speaks throughout a press convention on the Division of Justice on January 30, 2026 in Washington, D.C. (Alex Wroblewski/AFP by way of Getty Photographs)

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Jefferson and Brown allegedly visited shelters and Part 8 housing amenities, advertising themselves as “The Housing Guys,” to recruit Medicaid beneficiaries to join HSS providers that had been finally not supplied, the DOJ stated.

The DOJ additionally accused Jefferson of hiring relations and associates to work as workers who, at his path, created false buyer invoices that allegedly confirmed providers supplied. A number of the documentation allegedly confirmed that Jefferson had “invented faux workers” and used their names to signal buyer notes, the DOJ stated.

The division alleged that Brown didn’t hold notes “regardless of being required to take action below program guidelines.” The DOJ stated Jefferson and Brown “fabricated emails” about alleged prospects and used ChatGPT to create false buyer notes.

Jefferson and Brown reportedly traveled to Minneapolis from Philadelphia. (Bruce Bennett/Getty Photographs)

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“These defendants had no connection to Minnesota or its communities. They traveled throughout the nation with one purpose: to acquire and steal hundreds of thousands in taxpayer {dollars} meant to learn individuals fighting homelessness, habit and disabilities,” stated Assistant Lawyer Normal A. Tysen Duva of the Justice Division’s Legal Division. “Though applications like HSS are administered by the states, they’re funded with federal taxpayer {dollars}. The Legal Division is not going to stand by whereas fraudsters put all of Individuals’ tax {dollars} in danger.”