For 10 months, the Minneapolis Public Schools district quietly shorted its own employees’ health care trust by hundreds of thousands of dollars a month. Thanks to an unredacted report on the scandal, we now know who did it.
First reported by the Minnesota Reformer, the newly unredacted portions name Aaron Gilbert, the district’s director of finance-controller, as the individual who made the call to withhold nearly $3 million from the fund, according to investigators.
When Gilbert finally returned the money, she didn’t just wire it back. She routed it through a string of transactions involving the district’s investment account and bond proceeds. Investigators asked her about it, and she hasn’t offered an explanation.
“This series of transactions suggests that Ms. Gilbert had an intent to deceive,” the report concludes. Investigators also found her “evasive during her interview” and said she “generally did not come off as a credible witness.”
The withholding started in November 2024, but district staff outside finance didn’t notice until June 2025. The superintendent wasn’t told until the end of August, and the school board didn’t hear about it until late September. The public didn’t get any of this until the Reformer began filing records requests.
It doesn’t help that the district has known for over a decade that its finance department lacked enough staff to properly separate accounting duties, which would prevent one person from both recording a transaction and authorizing it. The district’s own auditor told investigators that, in effect, someone in Gilbert’s exact role could have pulled this off with nobody signing off. The district’s response so far is that it fixed its wire-transfer process by now requiring more people to approve them. But the underlying staffing problem auditors have been sounding the alarm on for a while is still sitting there, unaddressed.
Separate from the scandal, the district has also racked up more than $5 million in IRS penalties for botched employment tax filings. The district is paying the Center for Effective School Operations more than $68,000 a month to prop up its finance department, all while running a $50.5 million deficit. The group is part of Colorfuel, whose CEO used to be Gov. Tim Walz’s chief equity officer, according to the Reformer.
The Reformer also reports it still has more than a dozen data requests pending with the district, including some dating back to February. For a district this deep in financial trouble, this doesn’t inspire confidence that leadership is in a hurry to get to the bottom of these issues.
The wire-transfer fix addresses one symptom. But the district still hasn’t addressed the staffing problem its own auditors have been flagging since at least 2015. So what’s to stop this from happening again?
