By SDCN Staff
Twelve individuals are facing federal fraud charges after an investigation revealed that more than $10 million intended to help low-income families pay for childcare was instead funneled to bogus daycare providers.
In a coordinated takedown on September 10 more than 250 federal, state and local law enforcement officials arrested all defendants and executed 12 search warrants at homes in San Diego purported to be used as daycare facilities. The defendants are naturalized U.S. citizens and Lawful Permanent Residents originally from Syria, Somalia, Sudan, Afghanistan, and Iraq.
“These charges underscore a simple truth: anyone who steals from programs meant to support children will face swift and uncompromising accountability,” said Assistant Attorney General Colin McDonald of the Justice Department’s National Fraud Enforcement Division. “Fraud against these programs is an attack on vulnerable families, and law enforcement will continue to dismantle schemes that exploit them.”
The U.S. Department of Health and Human Services provides federal funding to California to help low-income families pay for childcare. In San Diego County, the County of San Diego, Child Development Associates, and the YMCA administer childcare subsidy programs.
When Child Development Associates or the YMCA determines that a family qualifies for subsidized childcare, the organizations pay the eligible childcare provider directly after the provider submits required monthly attendance records documenting the care provided. The records must be signed by both the provider and parent under penalty of perjury and include the dates and times children are in care.
California law also requires licensed childcare providers to be present and ensure that children are supervised at all times, except for limited temporary absences when a qualified substitute is present.
While the 12 federal complaints are unrelated, the scheme was essentially the same: Defendants obtained a California license to operate a home childcare facility and registered with Child Development Associates and the YMCA to provide subsidized childcare to eligible families. To receive government-funded payments, the defendants were required to submit monthly attendance records accurately documenting the dates and times they provided care to each child.
According to federal authorities, the defendants knowingly submitted false attendance records claiming they provided childcare on dates and at times when they did not. They also falsely certified, under penalty of perjury, that the information was true and correct. CDA and the YMCA relied on those fraudulent records and issued payments with federal funds intended to pay for childcare actually provided to low-income families.
The complaints describe how surveillance recordings of the defendants’ licensed facilities conflicted with what the defendants claimed in their attendance records. For example, Abdulrahman Ayman Alawad submitted attendance records claiming to have provided childcare to 23 children in March 2026 and 25 children April 2026, and that he provided childcare every day of those two months. But surveillance recordings covering 57 days of those months showed children entering or exiting Alawad’s facility on just one day — coincidentally, the day a state inspector showed up for an unannounced inspection, when children and Alawad himself arrived at the facility after the inspector arrived.
Additionally, Alawad and several other defendants submitted attendance records claiming to have provided childcare at their homes when border crossing records showed they were not even in the United States. For example, according to a complaint charging Turkiya Mamdouh Alawad, border crossing records show that she departed the United States on or about Jan. 1, 2024, and returned to the United States around Jan. 30, 2024. Despite not being in the United States, Alawad submitted attendance records to CDA and YMCA for the month of January 2024 and afterwards received eight direct deposits from CDA and YMCA that totaled $14,970.00 in February 2024.
The daycare scam is lucrative, the complaints indicate. Each defendant brought in between $538,000 and $1.2 million during various time periods that range from months to years. According to the complaints, Alawad received over $300,000 in payments from San Diego County, CDA, and YMCA in 2025 alone, and several defendants have each received over $1 million in payments in the course of their respective schemes.
