Federal authorities have charged 12 individuals with defrauding government childcare subsidy programs out of more than $10 million in California. The defendants allegedly operated licensed, at-home childcare facilities and submitted false attendance records to collect payments, despite having few or no children attending.
The charges were unsealed Tuesday in San Diego, a joint announcement from the Justice Department and the IRS criminal investigations division. Prosecutors allege that some defendants submitted claims and collected payments while they were not even in the country. One defendant, Turkiya Alawad, 63, is accused of submitting and collecting payments for childcare while outside the U.S. between January 1 and January 30, 2024.
Another defendant, Abdulrahman Alawad, 25, allegedly claimed to provide childcare in March and April, but surveillance footage reportedly showed children entering the facility only once, on the day a state inspector visited. This defendant is accused of receiving over $300,000 in payments in 2025.
Other defendants are alleged to have collected more than $1 million each in fraudulent payments. The IRS's Criminal Investigations Division has been investigating these facilities for several months. While the IRS primarily enforces tax law, its criminal investigations division also focuses on white-collar crimes.
The alleged scheme bears similarities to a case involving Feeding Our Future, a Minnesota-based organization accused of defrauding taxpayers of millions in meal and childcare subsidies. The California case, however, is alleged to be larger in terms of fraudulent childcare payments. The operator of Feeding Our Future's childcare facility pleaded guilty to conspiracy and wire fraud charges in July, and the organization's leader was convicted and sentenced to 41 years in prison in May for fraud and conspiracy charges, though she has appealed her conviction.
The Trump administration has placed a significant emphasis on investigating and prosecuting fraud and abuse within government benefit programs, with Vice President JD Vance chairing a task force dedicated to this effort.