Full Breakdown
Allegations of Widespread Fraud in California's Daycare and Hospice Systems
3/21/2026, 2:33:00 PM
Core Allegations of Fraud
YouTuber Nick Shirley has recently released a video alleging over $170 million in fraud within California's daycare and hospice systems. His investigation claims to uncover a network of "ghost" daycare centers and fraudulent hospice providers, which he argues are exploiting taxpayer funds. Shirley's findings coincide with a broader investigation led by Dr. Mehmet Oz, who has identified a $3.5 billion hospice fraud scheme in Los Angeles, where numerous providers are registered in close proximity despite stable population growth.
Investigative Findings
Shirley's video, which has garnered millions of views, showcases various locations in California where he claims to have found empty buildings masquerading as daycare or hospice centers. For instance, during his visit to San Diego, he noted that a daycare center listed as having 39 enrolled children had only five present during his investigation. Additionally, he highlighted a facility that had been previously convicted of maintaining "ghost kids." In Los Angeles, Shirley reported similar findings, including a hospice center that allegedly billed $4.8 million while appearing vacant.
Shirley utilized a combination of public records, including data from the Centers for Medicare & Medicaid Services (CMS) and state inspection logs, to substantiate his claims. He pointed out that California's Medi-Cal spending has surged by 1,000% since 2022, raising concerns about the lack of oversight in these programs.
Official Responses and Criticism
California Governor Gavin Newsom has publicly dismissed Shirley's allegations, labeling them as "political cosplay" and accusing him of racial profiling. Newsom's office has mocked Shirley on social media, suggesting that his investigations are politically motivated rather than genuine attempts to expose fraud. In contrast, Senator John Fetterman criticized Newsom for his response, arguing that any allegations of fraud should be taken seriously regardless of political affiliation.
Shirley has countered Newsom's dismissals by asserting that the governor is attempting to intimidate those investigating fraud. He emphasized that the misuse of taxpayer dollars affects all citizens, regardless of their political beliefs, and called for a collaborative approach to address the issues he has raised.
Conflicting Reports and Gaps
While Shirley claims to have uncovered significant fraud, the exact breakdown of the alleged $170 million has not been fully disclosed. Additionally, it remains unclear whether the California Department of Social Services or local law enforcement have initiated formal investigations into the specific facilities highlighted in Shirley's video. Critics have also pointed out that Shirley's previous claims regarding fraud in Minnesota were met with skepticism, as some allegations were disproven by inspectors.
Conclusion and Implications
The investigations led by Nick Shirley and Dr. Mehmet Oz have sparked a national conversation about potential fraud within California's taxpayer-funded social services. As the allegations gain traction, they may prompt further scrutiny from state auditors and law enforcement. The ongoing conflict between Shirley and Newsom underscores the complexities of addressing fraud in a politically charged environment, raising questions about accountability and the protection of vulnerable populations.