MINNEAPOLIS, September 18 — Hennepin County approved $2 million in March 2026 to help small businesses cover rent or mortgage payments as Operation Metro Surge kept customers away, and then shut the program down after 82 grants went out, county officials said. The money was administered by a nonprofit the county hired. Commissioner Jeffrey Lunde said nearly half of the applications for the taxpayer-funded recovery money were fraudulent.
“We caught the fraud before we spent any money,” Lunde said, calling it an unfortunate win.
How the program was built — and where it stopped
Lunde said the county originally allocated $2 million, part of which was administrative, with the rest intended for grants. Officials stopped the program when they saw diminishing results and found more and more fraud, he said. Asked by WCCO for an example of the fraud, Lunde said people were “applying all the information for that company except the phone number and name is not.” Data cited in the report shows small businesses lost hundreds of millions of dollars in revenue during Operation Metro Surge.
WCCO spoke with one legitimate Bloomington, Minnesota, business owner who received $10,000 from the program. Gilberto Diaz, who owns Luro Boots, said, “Rent doesn’t wait.
Bills don’t wait.” Diaz said he was upset when he heard about the fraud. “It is sad. When I was hearing this, I was upset because they don’t know the damage they do to a small business.” Lunde said, “We need to prosecute some people.
People need to be held accountable.” The Hennepin County Sheriff’s Office said it was asked to review the situation, and investigators requested materials to begin an investigation. Lunde said, “I think we’re gonna need the legislature to take a look.
Do we have some of the right laws to prosecute these people?” According to the report, $1 million of the unused grant money is still available.
