Attorney General Anthony G. Brown announced that Jonathan Tarrell Smalls, 41, the owner of multiple childcare centers in Baltimore, has been indicted on charges related to a massive fraud scheme, totaling over $2.5 million. Smalls faces multiple felony counts, including theft, identity fraud, and public assistance fraud.
The indictment, handed down by the Grand Jury for Anne Arundel County, stems from an extensive investigation led by the Attorney General’s Fraud and Corruption Unit, Criminal Division. Smalls, who operated facilities such as Habakkuk Outreach Ministries, House of New Beginnings, and It’z A Brighter Learning Center, is accused of defrauding the State of Maryland from 2014 to 2024 by misrepresenting his childcare centers and inflating attendance records to unlawfully receive state payments.
According to the first indictment, Smalls began his fraudulent activities after the Maryland State Department of Education (MSDE) revoked his childcare certification and refused to license any facilities associated with him. Undeterred, Smalls assumed multiple false identities and concealed his involvement in several childcare centers, which continued to operate under fraudulent licenses. He submitted falsified attendance records to claim inflated state payments meant for licensed childcare providers.
In one example, a facility owned by Smalls invoiced the State on February 6, 2018, for 51 children, all marked as present with no absences. However, an MSDE site visit revealed only 12 children in attendance that day. A more recent instance, on October 23, 2023, saw one of Smalls’ facilities bill the state for more than 20 children, even though the facility was actually closed with no children present.
The second indictment accuses Smalls of fraudulently receiving Supplemental Nutrition Assistance Program (SNAP) and Maryland Medical Assistance Program benefits from 2016 to 2024. Smalls allegedly falsified his residence and income to continue receiving benefits while living in Pennsylvania. Despite reporting an income of just $1,000 per month, Smalls owned properties in Florida and Pennsylvania and two luxury Bentley vehicles. His lavish lifestyle, including high-end assets, contradicted the low income he had reported, leading to his charges of fraudulent public assistance claims.
“These fraudulent actions undermine the integrity of essential public programs and directly harm the families who depend on them most,” said Attorney General Brown. “My Office is committed to holding those who exploit these vital services accountable for their actions.”
The case will be tried in the Circuit Court for Anne Arundel County, with a status conference scheduled for March 28, 2025.
Maryland State Department of Education Superintendent Dr. Carey M. Wright expressed gratitude to the Attorney General’s Office, stating, “Our partnership with the Maryland Office of the Attorney General is vital in maintaining high standards and lawful practices for those seeking to operate childcare facilities in the state.”
*****It is important to note that a criminal indictment is merely an accusation, and Smalls is presumed innocent until proven guilty beyond a reasonable doubt.
