Federal prosecutors in San Diego have charged 12 residents for running what prosecutors say was an elaborate daycare scheme that generated more than $10 million in proceeds from child care subsidy programs.

According to the U.S. Attorney’s Office for the Southern District of California, federal, state and local law enforcement agencies teamed up to close down what they allege were sham daycare facilities.

Prosecutors say the 12 people, aged 22-years-old to 63 years old with daycare facilities in San Diego and El Cajon, obtained home child care licenses and registered with Child Development Associates and the YMCA. The defendants, prosecutors say, submitted falsified attendance records to collect money from government subsidies.

The government alleges Child Development Associates and the YMCA relied on the records and issued payments using federal funds designated for eligible child care services.

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.

Prosecutors say surveillance footage and other documentation showed that the defendants said they were caring for children when they were not, and in some cases were not even in the country at the time.

In one example, a man claimed to care for as many as 25 children every day for two straight months, though surveillance recordings showed children at the daycare just one of the days.

In other instances, prosecutors say defendants were caring for far fewer children than they claimed in the attendance records.

“Today is a bad day for home daycare fraud,” said U.S. Attorney Adam Gordon. “These are the first charges alleging this type of fraud since the formation of the National Fraud Enforcement Division. These fraudsters may have criminally gamed the system before. But today, the game is over.”

City News Service contributed to this report.