NEW YORK\u00a0\u2014\u00a0Federal authorities charged a dozen people Tuesday for fraudulently collecting more than $10 million in government childcare payments in San Diego County, when the operators had few or even no actual children attending their facilities.<\/p>\n
The charges, jointly announced in San Diego by the Justice Department and the criminal investigations division of the IRS, are the latest effort by the Trump administration to investigate and charge alleged cases of fraud and waste in government programs.<\/p>\n
The 12 defendants said they were operating licensed, at-home childcare facilities in the San Diego area, submitting attendance records and documenting when each child attended and for what times, in order to collect payments from government childcare subsidy programs. However, federal prosecutors allege these at-home facilities rarely, if ever, had children. Defendants fraudulently collected from government programs for months or, in some cases, years, prosecutors alleged. <\/p>\n
The federally funded assistance programs are intended to help low-income families afford childcare so parents can work or go to school. After parents are accepted into a program, they select a childcare provider and the government reimburses the provider directly. But the programs don\u2019t get enough money to cover all eligible families, forcing many parents onto growing waitlists.<\/p>\n
Such a federally funded program led these defendants to allegedlu operate these \u201cghost\u201d daycares, prosecutors said.<\/p>\n
\u201cThere were no children,\u201d Colin McDonald, head of the Justice Department\u2019s fraud enforcement division, said at a news conference Friday. \u201cThere were no daycares. But the taxpayers were paying for all of it.\u201d<\/p>\n
The department\u2019s fraud division was created in April and this was the first indictment of its type since.<\/p>\n
All 12 defendants were arrested Thursday and the charges against them were unsealed Tuesday. Prosecutors said the investigation continues.<\/p>\n
Federal prosecutors said some of the defendants were not in the country when they were submitting claims for childcare payments. One defendant, Turkiya Alawad, 63, was found to be outside the U.S. between Jan. 1 and Jan. 30, 2024, but at the same time, submitted and collected for childcare payments for the dates they were away, prosecutors allege. <\/p>\n
Another defendant, Abdulrahman Alawad, 25, claimed to provide childcare to children in March and April but surveillance footage allegedly shows children entered Alawad\u2019s facility only once, on the day a state inspector showed up. Alawad is alleged to have received more than $300,000 in payments from childcare programs in 2025.<\/p>\n
Other defendants collected more than $1 million in childcare subsidy payments, prosecutors alleged. Jared Koopman, head of the IRS criminal investigations division, told reporters the defendants then allegedly used the proceeds to purchase luxury homes, send money overseas through wire transfers, and make large cash withdrawals. <\/p>\n
\u201cThese are taxpayer-funded programs designed to help working families, children and vulnerable communities,\u201d Koopman said. \u201cWhen those funds are diverted for personal profit, families lose, honest providers lose, taxpayers lose and the public trust in these programs is damaged.\u201d<\/p>\n
While several of the defendants have similar last names, the Justice Department\u2019s McDonald told reporters each investigation and indictment was reached independently. <\/p>\n
The indictments in Southern California have similarities to what happened with Minnesota-based Feeding Our Future. Federal prosecutors charged Feeding Our Future with scamming Minnesota and federal taxpayers out of millions of dollars of childcare and meal subsidies.<\/p>\n