A Baltimore childcare operator who once ran multiple centers across the city is headed to prison after state prosecutors say he quietly siphoned millions from a program meant for low-income families trying to afford daycare.
Jonathan Tarrell Smalls, 42, was sentenced in Anne Arundel County to four years in prison after what authorities describe as a decade-long fraud that drained roughly $2.76 million from Maryland's Child Care Scholarship Program. The court ordered him to repay $2,760,036 and warned that violating probation terms could add more time on top of the prison stint. Prosecutors say the money, intended to help struggling parents cover childcare costs, was diverted through inflated attendance records and sham billing practices.
According to Daily Voice, the judge tacked on five years of supervised probation once Smalls is released and made it clear that an additional 11-year penalty could be triggered if he violates those terms. The sentence will not start immediately: it will begin after Small finishes serving an unrelated term he is already incarcerated on, the outlet reports.
How Prosecutors Say The Scheme Worked
Prosecutors allege Smalls ran several Baltimore childcare centers, including Habakkuk Outreach Ministries, House of New Beginnings, and It’z A Brighter Learning Center, and kept the public money flowing even after he lost his licenses. According to CBS Baltimore, he did it by using false identities and padding attendance records so that the state would keep sending scholarship payments.
Inspectors later uncovered just how inflated those numbers were. At one site, records showed 51 children marked present on a single day in February 2018, when only 12 were actually there. An October 2023 inspection found another center closed altogether, even as it was being billed for more than 20 children, according to the same outlet.
Prosecutors also say the fraud did not stop with childcare. Smalls allegedly continued to collect SNAP and medical assistance from Maryland while he was living in Pennsylvania by falsifying both his address and his income.
Charges, Plea And Earlier Indictment
Smalls pleaded guilty in March 2025 to a felony theft scheme of over $100,000, a felony theft scheme of $25,000 to $100,000, and filing a false tax return, according to an indictment and related materials from the Maryland Attorney General’s Office. That 2025 filing by the Attorney General’s Fraud and Corruption Unit alleged that the scheme ran from 2014 through 2024 and that Smalls used sham paperwork to keep the scholarship payments coming even after state regulators tried to shut down his operations in the Maryland Attorney General’s Office.
Official Reactions And Oversight
State officials did not hold back in their assessment of the case. “While Maryland families struggled to afford childcare, Jonathan Smalls was pocketing millions in scholarship payments, driving Bentleys, and owning properties in multiple states,” Attorney General Anthony Brown said, according to Daily Voice. Not exactly the intended use of a safety-net program.
Maryland State Superintendent Dr. Carey M. Wright, also cited by Daily Voice, said the Maryland State Department of Education remains committed to strong oversight, and both officials framed the prison term and restitution order as necessary steps to protect the families who rely on the Child Care Scholarship Program to stay afloat.
Legal Implications
Beyond the criminal sentence, the state secured a restitution order aimed at sending the stolen money back to the Child Care Scholarship Program. Maryland officials have emphasized that the program is vital for low-income households and that keeping it honest requires tight oversight.
The Attorney General’s earlier indictment details how the office worked with the Maryland State Department of Education to flag unusual billing patterns and alleged identity fraud, moves that prosecutors say were crucial to building the case.
Prosecutors say they will continue trying to claw back funds wherever possible and are urging families who use the scholarship program to keep an eye on their billing and report anything that looks off. For more background on the indictments and the timeline of the investigation, see reporting from CBS Baltimore.
