Two Pennsylvania men admitted to repeatedly traveling from Philadelphia to Minneapolis in an effort to defraud Minnesota’s Housing Stabilization Services (HSS) program, prosecutors announced. The men allegedly defrauded approximately $3.5 million from the program and used artificial intelligence to create false records.

The two men, identified as Anthony Waddell Jefferson, 37, and Lester Brown, 53, allegedly set up businesses in Minnesota and registered as HSS providers. Men were supposed to provide housing consulting, transition services, and maintenance to qualified individuals.

The state’s HSS program, which officially launched in July 2020, aims to help people with disabilities, including seniors and people with mental illness or substance abuse problems, find and maintain housing. The Department of Justice previously said the program “had low barriers to entry and minimal enrollment requirements for reimbursement.”

Attorney General Pam Bondi responded: “Criminal fraud not only steals from taxpayers, it erodes trust in our institutions. Under President Trump’s leadership, today’s convictions are just the beginning. Our prosecutors will work tirelessly to unravel criminal fraud schemes and prosecute their perpetrators in Minnesota and across the country.”

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The Mississippi River is seen against the Minneapolis skyline on February 7, 2025. (Matt McClain/The Washington Post via Getty Images)

Jefferson and Brown are accused of stealing approximately $3.5 million from HSS for services they falsely claimed to have provided to about 230 Medicaid beneficiaries. The men pleaded guilty to felony wire fraud and face up to 20 years in prison, the DOJ said.

“Minnesota will no longer be a haven for fraud under our watch,” said Assistant Attorney General Todd Blanche. “The Department of Justice has been investigating billions in taxpayer fraud across the country and has already successfully convicted 66 people and counting in Minnesota. The partnership between the Criminal Division and the United States Attorney’s Office is an excellent example of how we are restoring justice and public trust while holding criminal fraudsters accountable.”

Assistant Attorney General Todd Blanche speaks during a news conference at the Department of Justice on January 30, 2026 in Washington, DC (Alex Wroblewski/AFP via Getty Images)

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Jefferson and Brown allegedly visited Section 8 shelters and housing facilities, marketing themselves as “The Housing Guys,” to recruit Medicaid beneficiaries to sign up for HSS services that were ultimately not provided, according to the DOJ.

The DOJ also accused Jefferson of hiring family members and associates to work as employees, who, under his orders, created false customer notes purportedly showing services rendered. Some of the paperwork allegedly showed Jefferson had “invented fake employees” and used their names to sign customer notes, the DOJ said.

The department claimed that Brown did not keep notes “even though the rules of the program require it.” The DOJ said Jefferson and Brown “fabricated emails” about alleged clients and used ChatGPT to create fake client notes.

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

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“These defendants had no connection to Minnesota or its communities. They traveled across the country with one purpose: to steal millions of taxpayer dollars intended for people struggling with homelessness, addiction and disabilities,” said Assistant Attorney General A. Tysen Duva of the Department of Justice’s Criminal Division. “Although programs like HSS are run by the states, they are funded with federal tax dollars. The Criminal Division will not stand by while fraudsters put all of America’s tax dollars at risk.”