Two Mankato residents are facing federal charges in a seven-year scheme to defraud taxpayer-funded housing and welfare programs. Kyle Lewis Kirschman, 52, and Holly Kay Bloom, 37, were indicted on December 21, 2016, in U.S. District Court in Minneapolis on one count each of conspiracy to commit public assistance fraud.
According to the indictment, Kirschman owned a split-unit home in Mankato, occupying Apartment 1 while leasing Apartment 2 to Bloom and her family beginning June 13, 2006. He applied to have Apartment 2 approved under the HUD Section 8 program—contingent on the claim that neither tenant shared familial ties nor residences. At the same time, Bloom applied for SNAP and Medical Assistance benefits, deliberately omitting Kirschman from her household.
But the truth, prosecutors say, was far different. From at least June 2007 through February 2014, Kirschman and the Bloom family lived together across both units. During this period, Kirschman was an immediate family member residing with Bloom’s household—directly violating Section 8 requirements. Apartment 2 was never an independent residence, yet Kirschman collected $35,221 in rental subsidies.
Meanwhile, Bloom unlawfully received $25,216 in SNAP food benefits and $14,624 in Medical Assistance—all while Kirschman was employed and earning income that disqualified them under program rules. By falsifying their living situation and household composition, the pair systematically exploited public aid meant for the most vulnerable.
The case emerged from a joint investigation by the Blue Earth County Sheriff’s Office Welfare Fraud Investigator and the U.S. Department of Housing and Urban Development’s Office of Inspector General. Authorities say the depth and duration of the fraud reflect a calculated effort to game multiple federal safety nets simultaneously.
The case is being prosecuted by Assistant U.S. Attorney Manda Sertich. Kyle Lewis Kirschman, 52, of Mankato, Minn., and Holly Kay Bloom, 37, of Mankato, Minn., each face one count of conspiracy to commit public assistance fraud. The charges are merely accusations; the defendants are presumed innocent unless proven guilty in a court of law.
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Key Facts
- State: Minnesota
- Agency: DOJ USAO
- Category: Fraud & Financial Crimes
- Source: Official Source ↗
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