1st guilty pleas entered in $250M federal food program fraud

Published 8:47 am Friday, October 14, 2022

MINNEAPOLIS — The first batch of guilty pleas involving about 50 people charged in a $250 million scheme to defraud a federal meals program in Minnesota were entered Thursday in a Minneapolis courtroom.

Hadith Ahmed, 33, who worked for the Feeding Our Future program, became the first employee to plead guilty and testify about the fraud. He admitted to taking more than $1.3 million in bribes to help other co-conspirators.

The alleged $250 million fleecing of the nonprofit Feeding Our Future program targeted federal child nutrition programs that provide free meals to low-income children and adults. Prosecutors are calling it the largest pandemic-related fraud in the U.S.

Ahmed told U.S. District Judge Nancy Brasel that the organization ran a “pay to play” system that required sites it sponsored to kick back a portion of the federal money they received in exchange for Feeding Our Future’s sponsorship, the Star Tribune reported.

Bekam Merdassa and Hanna Marakegn, both 40, pleaded guilty to one count each of conspiracy to commit wire fraud.

Marakegn, who owned Brava Café in Minneapolis, admitted Thursday to receiving $7.1 million in federal child nutrition program money after falsely claiming to have served millions of meals to needy children during the pandemic. Merdassa said his company falsely claimed to have served 1.3 million meals to children and submitted fake invoices in exchange for illegal reimbursements.

All three defendants are charged with conspiracy to commit wire fraud.