Washington State’s Auditor Just Exposed a a Child Care Fraud Nobody Can Explain

Minnesota prosecutors charged more than ninety people this year in a stolen childcare fraud scheme that started inside Somali-run daycares.

Washington state's child care subsidy program spent hundreds of millions of dollars with almost no oversight, auditors found.

State auditors could not say where four hundred million dollars in childcare payments actually went.

A Nonpartisan Auditor Flagged the Same Program Twice

Washington's state auditor, a Democrat, released a report in January finding the Department of Children, Youth, and Families failed to properly track roughly four hundred million dollars in Child Care Development Fund spending over four years.

The department told auditors it conducts unannounced site visits at every licensed provider annually.

In 2025, that same department referred just fourteen providers to its Office of Fraud and Accountability.

Zero of those referrals resulted in a prosecution.

Reporters at The Post Millennial identified specific home daycares in the Seattle area with financial patterns state auditors flagged as unverified: Daisy Family Childcare, billing an estimated two million dollars and seventy thousand dollars a month, Aboo Family Daycare, billing forty thousand dollars a month, and Star Family Home Daycare, billing thirty thousand dollars a month.

Neighbors told reporters they rarely saw children at some locations during business hours.

Six Licensed Slots, Eight Hundred Thousand Dollars in Reported Sales

National Review examined the disparity between license capacity and reported revenue at specific Washington providers.

Kismaya Family Childcare was licensed for nine children, reported more than seven hundred fifty thousand dollars in sales in 2025, and received one hundred twenty thousand dollars in state subsidy money before the business was administratively dissolved.

Honey Home Daycare reported one point nine million dollars in revenue since 2023 on a license for a handful of children.

Little Star's Early Learning Program was licensed for six children and reported nearly eight hundred thousand dollars in sales.

Mabsuud Daycare, licensed for twelve children and run by Zainab Dirie, president of the Supportive Childcare Provider Alliance, received more than four hundred fifty thousand dollars in state funding and two forgiven Paycheck Protection Program loans worth roughly thirty thousand dollars.

The math on a licensed capacity of six to twelve kids does not produce six or seven figures in annual revenue without something else going on.

https://twitter.com/EricLDaugh/status/2102073028544729113

The State's Response Has Been Words, Not Charges

Governor Bob Ferguson said in a briefing that he was "not aware of anything like that" happening in Washington, but added that "if there is fraud, you need to be held accountable, I don't care who you are."

At the federal level, Department of Health and Human Services Deputy Secretary Jim O'Neill announced he had activated what he called a "defend the spend system" for all Administration for Children and Families payments nationwide, requiring a justification receipt or photo evidence before money goes out the door.

HHS has already frozen child care payments to Minnesota, where more than ninety people face charges in a related scheme.

No criminal charges have been filed against any Washington provider as of this writing.

Attorney General Nick Brown has separately warned residents against showing up at daycare providers' homes to film or confront them, calling that conduct harassment rather than investigation.

That warning does not change what the state's auditor already put in writing: hundreds of millions of dollars moved through a program the department in charge could not properly verify.

Fourteen Referrals, Zero Prosecutions Is Not an Oversight Program

The people running Washington's Department of Children, Youth, and Families are not victims of an internet pile-on.

They are the ones who told the state auditor they conduct unannounced inspections every year, then referred fourteen cases out of hundreds of providers and secured not one conviction.

Minnesota shows exactly what this blind spot turns into if nobody closes it: ninety-plus defendants, hundreds of millions in stolen COVID-era and childcare funds, and a scheme investigators say ran for the better part of a decade before anyone with subpoena power looked closely.

Washington's auditor already flagged the identical failure, in writing, months before any of this made headlines.

Olympia can act on that finding now, or it can explain to voters later why it waited for a federal indictment to do a state auditor's job for them.

Sources:

• Katie Daviscourt, "Breaking: Seattle-area Somali home daycares rake in $5 million of taxpayer funds in potential misuse scheme," The Post Millennial, September 21, 2026.
• "Somalis run a huge share of Washington State's taxpayer-funded childcare services. The numbers don't add up," National Review, 2026.
• "Washington officials seek clarity on day care fund usage amid national fraud investigation," KOMO News, 2026.
• "Washington state child care subsidies under audit amid fraud allegations," KOMO News, 2026.
• "AG Brown issues statement on reports of harassment of daycare providers," Washington State Office of the Attorney General, December 30, 2025.