A St. Paul man has admitted he helped turn a Medicaid-backed housing safety net into a personal payday. On Tuesday, Khalid Ahmed Dayib pleaded guilty to federal wire fraud for his role in what prosecutors say was a scheme that funneled taxpayer money from a housing program into a private company and the personal accounts of its operators. Dayib acknowledged that he helped enroll a provider that billed the program for services that were largely not delivered.
According to CBS Minnesota, Dayib entered his guilty plea in U.S. District Court to one count of wire fraud and admitted filing paperwork to enroll Brilliant Minds Services LLC as a Housing Stabilization Services (HSS) provider. The U.S. Department of Justice has described the HSS program as having “low barriers to entry and minimal records requirements,” language prosecutors say shows how the program became an easy target for mass billing schemes.
Federal filings cited by prosecutors indicate Brilliant Minds submitted about $2.3 million in reimbursement claims between September 2022 and April 2025, and investigators say much of that billing was inflated or for services that were never performed. According to the DOJ’s case notes, Dayib and several alleged co-conspirators diverted funds for personal use, each pocketing roughly $300,000 to $400,000 between April 2023 and May 2025, and they allegedly charged nearly $500,000 on a shared Platinum American Express card.
State fallout and program pause
The HSS program’s rapid growth alarmed state and federal officials. Payouts climbed from roughly $21 million in 2021 to about $104 million in 2024, with another $61 million paid in just the first half of 2025, according to reporting that reviewed prosecutors’ figures. As the Star Tribune and state officials note, Minnesota’s Department of Human Services moved to halt or curtail payments during the investigation and later suspended the program after auditors and law enforcement uncovered widespread irregularities.
Legal outlook
Dayib has pleaded guilty to one count of wire fraud, and a sentencing date has not yet been set, CBS Minnesota reports. Under federal law, 18 U.S.C. § 1343, the wire fraud statute, carries a statutory maximum prison term of 20 years for a conviction on a single count.
Prosecutors say Dayib’s guilty plea is one of several expected outcomes from an ongoing probe that has produced multiple indictments and pleas tied to HSS and related Medicaid-funded programs. Federal and state officials continue to trace payments and seek restitution as investigators work through provider records and court filings; Hoodline covered the initial wave of indictments last year in its report, Eight charged in first wave.
