Feds Charge 12 San Diego-Area Residents in Alleged $10 Million Fraud Scheme
https://legalinsurrection.com/2026/09/feds-charge-12-san-diego-area-residents-in-alleged-10-million-fraud-scheme/
The “Dirty Dozen” turned a taxpayer-funded childcare program for low-income families into an alleged multimillion-dollar cash machine.
Little did I realize that, as a San Diegan, I live in one of California’s biggest fraud havens.
Federal prosecutors say a dozen San Diego County residents turned a taxpayer-funded childcare program for low-income families into an alleged multimillion-dollar cash machine.
The indictment alleges more than $10 million was siphoned through falsified attendance records, including claims submitted while purported providers were outside the country.
The defendants, who all reside in either San Diego or El Cajon, were arrested last Thursday for allegedly falsifying monthly attendance records required to receive federal funds to pay for childcare.
Though the defendants claimed in those documents to be caring for children on specific dates, the U.S. Attorney’s Office alleges those claims were disproved by surveillance footage or other documentation showing the purported providers were not even in the country on those dates.
One such example highlighted by prosecutors involved a man who claimed to care for as many as 25 children every day for two straight months, though surveillance recordings showed only one day during that time period in which children were present. On that day, a state inspector made an unannounced visit to the home, but no one was present, and less than 30 minutes later, the defendant and children arrived at the home, prosecutors allege.
Other defendants were caring for far fewer children than they claimed in the attendance records, according to court documents.
Fraudsters FOILED in San Diego.
A dozen individuals were arrested for their role in a multi-million-dollar childcare fraud scheme.
The patriots @HSI_HQ are hard at work with our @WHFraudTF partners in stopping this flagrant theft of taxpayer dollars. pic.twitter.com/bS8lMQSIKG
— Homeland Security (@DHSgov) September 16, 2026
According to the Department of Justice press release, the fraud suspects arrested are:
- Abdulrahman Alawad Age: 25 City of Residence: El Cajon, CA
- Fosiya Mohamoud Age: 50 City of Residence: El Cajon, CA
- Zetun Abdi Age: 43 City of Residence: San Diego, CA
- Ikramullah Mohmmand Age: 25 City of Residence: El Cajon, CA
- Khetam Haouash Age: 37 City of Residence: El Cajon, CA
- Khatera Hashimi Age: 39 City of Residence: El Cajon, CA
- Mariam Khamis Age: 42 City of Residence: San Diego, CA
- Mohamad Alawad Age: 29 City of Residence: San Diego, CA
- Mazin Alawad Age: 22 City of Residence: San Diego, CA
- Turkiya Alawad Age: 63 City of Residence: San Diego, CA
- Zaryab Daudzai Age: 25 City of Residence: El Cajon, CA
- Cezar Yaqoob Age: 36 City of Residence: El Cajon, CA
Massive fraud ring busted in San Diego. Zoom in on the names. What do you notice?
Our country is just being plundered by foreign enemies pic.twitter.com/gBhFOsjcuH
— Mrs B (@attackdogX) September 16, 2026
Investigators focused on matching where these “babysitters” were actually, versus the claims they made on their paperwork.
According to a complaint against Turkiya Mamdouh Alawad, border records show she left the country around Jan. 1, 2024, and returned around Jan. 30.
Yet she allegedly submitted January attendance records and subsequently received eight CDA and YMCA deposits totaling $14,970.
The alleged profits were enormous.
Each defendant reportedly collected between $538,000 and $1.2 million over periods ranging from months to years.
Alawad allegedly received more than $300,000 in 2025 alone, while several defendants allegedly collected more than $1 million each.
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Focus on these daycare abuses was inspired by the work of Nick Shirley, who uncovered massive fraud in Minnesota.
In January, private investigator Amy Reichert posted about the alleged fraud at one of the same daycares. She even visited several daycares alongside Youtuber Nick Shirley.
“I saw what Nick Shirley was doing in Minnesota with the ghost daycare fraud, I’m a state licensed private investigator, I started inspecting the state records for daycares here and we came up with the dirty dozen,” Reichert said.
…All 12 defendants are charged with wire fraud, which carries a maximum penalty of 20 years in prison and a $500,000 fine. Some defendants are also charged with money laundering, which carries the same maximum exposure.
The 12 people were arrested Thursday morning and executed 12 search warrants at the homes. Officials said it was a coordinated takedown with more than 250 federal, state and local law enforcement.
Department of Justice to Unveil Significant Charges Related to Childcare Fraud in San Diego Tomorrow at 11 AM. I’ll be there.
USA v. Mohamad Salim Alawad and USA v. Mazin Salim Alawad are set to be announced at a federal press conference on childcare fraud.
According to divorce… pic.twitter.com/ViF2pBedrA
— Amy Reichert (@amyforsandiego) September 15, 2026
The San Diego “dirty dozen” case is a disturbing example of the type of abuse that flourishes when paperwork is treated as proof and oversight is lacking.
If the allegations hold, then this was an industrial-scale betrayal of families genuinely needing childcare assistance and of every taxpayer compelled to finance it.
The arrests are welcome, but California officials should explain how such obvious red flags, including providers allegedly billing while out of the country, were allowed to persist for so long.
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