The U.S. Marshals Service said Michael Krzyzaniak, 64, and Gerald Greenfield, 67, were in custody at the Ramsey County jail ahead of a federal court appearance, the Minneapolis Star Tribune reported.
"Tip information led investigators to the hotel where Krzyzaniak and Greenfield were located together," the Marshals Service said in a statement. "The pair were arrested without incident."
The two were caught 175 miles from the minimum-security prison at a Hampton Inn in Burnsville, a Minneapolis suburb, where they had been staying since Sunday, Laura Bourdon, a representative for TMI Hospitality, which owns and operates the hotel, told the Star Tribune.
While they had given a credit card number, they paid for their room with cash as they extended their stay daily, Bourdon said. The pair used aliases when they registered.
Authorities said the Krzyzaniak, of Minneapolis, and Greenfield, of nearby Bloomington, walked away from the unfenced prison campus last weekend.
Krzyzaniak has nine years left on a more than 12-year term for bilking investors out of nearly $26 million. Greenfield was about halfway through a four-plus-year sentence for conspiracy to commit money laundering as part of a $2.5 million mortgage fraud scheme.