A state employee who suspected fraud in federal meal programs and reported it to the FBI took the stand Tuesday in the high-profile trial connected to Feeding Our Future, saying she had concerns just one month into the COVID-19 pandemic, when rules were loosened.

Emily Honer, a nutrition program supervisor at the Minnesota Department of Education, said she noticed a pattern of newly established restaurants signing on to distribute food to kids in need across Minnesota. Honer, the first witness to testify in the trial, said that restaurants like Empire Cuisine & Market — the Shakopee restaurant at the center of the trial — quickly grew to submit millions of dollars in federal reimbursement requests.

"I was concerned that a brand-new restaurant had that capacity for meals," she said. "I had never seen payments of that magnitude before."

In the first trial to take place since the FBI's massive fraud investigation into the meal programs was revealed more than two years ago, Honer was called by prosecutors in the case, which accuses seven defendants of defrauding the government by pocketing money meant to feed children in need.

Prosecutors have said that the more than $250 million fraud is one of the biggest cases of its kind in Minnesota history and one of the largest pandemic-related fraud cases in the country.

The U.S. Department of Agriculture-funded programs reimburse schools, nonprofits and day cares for feeding low-income children after school or during the summer. The programs are administered by the Education Department, which reported the possible fraud to the FBI in early 2021 after it said the USDA didn't take its concerns seriously. Republican lawmakers have criticized the agency for not doing enough to stop the alleged fraud sooner.

On Tuesday, the second day of the trial, defense attorney Fred Goetz pointed out that the agency continued to approve Feeding Our Future food sites in 2021 and 2022 despite having concerns in April 2020. If there were invalid claims of $250 million, couldn't the USDA claw back its $250 million from the state, Goetz asked Honer. She confirmed they could.

"Have they done it?"

"They have not," she said.

Prosecutors allege that defendants stole millions of dollars from the meal programs to buy luxury houses, cars and trips, and engaged in a system of kickbacks and bribes. Since the first charges were filed in September 2022, 70 people have been charged or indicted and, of those, 18 have pleaded guilty.

Defense attorneys for the seven defendants said Tuesday to the jury that they'll present evidence that "real food" was served to kids and their clients didn't steal any money, making a fair profit. The defendants — Abdiaziz Shafii Farah, Mohamed Jama Ismail, Abdimajid Mohamed Nur, Said Shafii Farah, Abdiwahab Maalim Aftin, Mukhtar Mohamed Shariff and Hayat Mohamed Nur — have been charged with wire fraud and money laundering, among other charges.

They all have ties to Empire Cuisine & Market, which enrolled in the meal program in April 2020 after the pandemic started. Empire quickly grew the number of claims it submitted for reimbursements, receiving an amount similar to the $17 million that Minneapolis Public Schools got for feeding about 40,000 students across 55 sites, Honer said.

"It didn't seem reasonable," she added.

A St. Paul nonprofit, Partners in Nutrition, operating as Partners in Quality Care, oversaw Empire's paperwork and reimbursements. Partners in Nutrition was started in 2015 by Christine Twait and Aimee Bock, who was later fired and left to lead Feeding Our Future, another sponsor of the programs. Bock, who has been charged, has denied wrongdoing and pleaded not guilty. No one associated with Partners has been charged.

In early 2020, Honer said, Partners in Nutrition contacted the Education Department to ask if restaurants could participate in the meal program; they hadn't been allowed to previously, but it was among the relaxed rules the USDA signed off on to disperse food to kids when schools shuttered in the pandemic.

By summer 2020, Honer said, she was concerned that more and more site applications were coming from just-formed restaurants sponsored by both Partners and Feeding Our Future. One food site that served thousands of meals, she said, was allegedly at a Circle Pines park closed for construction.

In 2021, Feeding Our Future received nearly $200 million, up from $3.4 million in 2019, while Partners in Nutrition received more than $200 million in 2021, up from $5.6 million in 2019.

Defense attorneys argued that defendants followed the loosened rules, which included giving out "meal packs" containing seven days' worth of food, which rapidly increased the amount of food distributed.

Federal waivers were constantly changing the rules, added defense attorney Patrick Cotter, who represents Ismail.

"The buck stopped with you," he told Honer. If it was difficult for her department to track all the changes, he asked, wouldn't it be difficult for sponsors and food sites? "This was complicated stuff, wasn't it?"

Honer testified for nearly seven hours Monday and Tuesday, saying she notified Partners in Nutrition in October 2020 that restaurants couldn't continue to participate based on new direction from the USDA that the sites weren't complying with the rules. Empire continued to work as a vendor for a growing number of food sites, she said.

Honer said she contacted the USDA about her concerns in the spike in reimbursements and her team stopped payments, but Feeding Our Future, which had sued the department in 2020, took it to court and accused the agency of racism and discrimination for denying applications to an organization working mostly with East African groups.

The judge in that case told the Education Department he saw no regulations giving the state authority to stop payments then, and it restarted payments to Feeding Our Future. Instead, because the state agency didn't have investigative authority, Honer said, she reported concerns to the FBI.