One defendant claimed to be caring for 23 children. Another claimed 25. During 57 days of surveillance, investigators found that the children only showed up when state inspectors did.
The rest of the time, the daycare centers were empty and the checks kept clearing.
Attorney General Todd Blanche announced on September 15 that twelve immigrants have been charged with wire fraud and money laundering for funneling more than $10 million out of a San Diego County childcare subsidy program. Blanche said the defendants were arrested that morning for "funneling more than $10 million intended to help low-income families pay for childcare."
The scheme worked like this, according to the DOJ: defendants obtained California licenses to operate home childcare facilities and registered with Child Development Associates and the YMCA to provide subsidized childcare to eligible families. They submitted false attendance records. They billed for children who weren't there. The money — between $538,000 and $1.2 million per defendant, with at least one pulling in more than $300,000 in 2025 alone and multiple defendants clearing $1 million each — came from programs funded by the U.S. Department of Health and Human Services and the County of San Diego.
The U.S. Attorney for the Southern District of California brought the charges. The defendants come from five countries: Fosiya Mohamoud and Zetun Abdi from Somalia. Abdulrahman Alawad, Khetam Haouash, Mohamad Alawad, Mazin Alawad, and Turkiya Alawad from Syria. Ikramullah Mohmmand, Khatera Hashimi, and Zaryab Daudzai from Afghanistan. Mariam Khamis from Sudan. Cezar Yaqoob from Iraq.
Border crossing records helped crack the case. One defendant crossed the border on January 1, 2024, didn't return until January 30, 2024 — and still received $14,970 in February for childcare supposedly provided during the absence. That's the kind of math that only works when nobody's checking.
As independent journalist Nick Shirley put it: "Hey Gavin Newscam, where were the kids? Good job covering for fraudsters and attacking the person who exposed the fraud."
The program these defendants exploited exists because working families in San Diego can't afford daycare. That's who the money was for — parents pulling shifts who need someone watching their kids. Every fraudulent dollar claimed was a dollar unavailable to a family that actually needed it. Every fake attendance record displaced a real child from a real waiting list.
The DOJ noted that the defendants' facilities were licensed and registered through legitimate channels. They had the paperwork. They had the state credentials. They had everything except actual children receiving actual care.