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S 4788

Stop Child Care Scams Act of 2026

119th Congress Introduced by Ashley Moody

The bill tightens oversight and penalties to curb fraud in CCDBG funding, with mandatory sanctions, improved state plans, and annual improper payment reporting.

Introduced in Senate
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WeVote Research Nonpartisan
Bill Summary · S 4788

Bill Overview

  • Name: Stop Child Care Scams Act of 2026
  • Bill number: S. 4788 (119th Congress)
  • Sponsor: Sen. Ashley Moody (co-sponsor)
  • Objective: Strengthen mechanisms to prevent and penalize fraud in the Child Care and Development Block Grant (CCDBG) program and related child care programs; enhance State accountability and program integrity; and expand reporting and monitoring related to improper payments and fraud.

Main Purpose and Intent

  • To amend the CCDBG Act of 1990 to curb fraud and abuse in federal child care funding.
  • To tighten State oversight, ensure stronger internal controls, and impose clearer consequences for fraud.
  • To require more rigorous monitoring, timing, and transparency around improper payments and sanctioned providers.

Key Provisions and Changes

  1. Strengthened authority to withhold and sanction

    • The bill changes a key enforcement standard from “Secretary may” to “Secretary shall” with respect to withholding funds for fraud (Sec. 2).

  2. Program integrity and accountability (new plan requirements)

    • States must include in their plan:
      • Internal controls for program integrity and accountability.
      • Processes to investigate and recover fraudulent payments and to sanction clients or providers involved in fraud.
      • Procedures to document and verify eligibility.
      • How the State uses data across agencies to oversee providers serving CCDBG recipients (Sec. 3).

  3. Fraud termination and debarment (expanded enforcement)

    • Adds explicit termination of fraud-related awards and permanent debarment for providers found engaging in fraud, with alignment to related programs (Sec. 4, Sec. 7).

  4. Fraud definitions and debarment cross-program effects

    • Expands definitions of “final determination of fraud” and ties CCDBG debarment to related programs like the Child and Adult Care Food Program if applicable (Sec. 4, Sec. 7).

  5. Improper payments and corrective action

    • Establishes an improper payment threshold (more than 5% of total payments for a fiscal year) that triggers:
      • a corrective action plan to reduce improper payments to 5% or less;
      • required reporting to demonstrate compliance (Sec. 5).

  6. Conditional ineligibility for persistent improper payments

    • If a state exceeds 5% improper payments for two consecutive fiscal years, it becomes ineligible for CCDBG funds unless it takes steps to substantially reduce the rate or show progress on corrective actions (Sec. 5).

  7. Cyclical and targeted monitoring

    • Introduces a 3-year cycle of comprehensive performance reviews; designates “high risk” states and warrants additional monitoring (Sec. 6).

  8. Fraud prevention and cross-program reporting (GAO study and report)

    • Requires a GAO study on fraud prevention across federal early childhood, child care, and nutrition programs, including data adequacy and cross-program integrity (Sec. 9).
    • GAO report due within 2 years with recommendations (Sec. 9).

  9. Fraudulent payments reporting

    • States must annually report the dollar and percentage of improper payments, broken out by categories (fraud, overpayments, underpayments, etc.) (Sec. 10).

Who and What is Affected

  • Primary: States administering CCDBG funds and the child care providers and families who receive CCDBG-supported services.
  • Related Programs: Providers participating in the Child and Adult Care Food Program may be affected via debarment linkage.

Procedural and Timeline Aspects

  • Introduced and referred to the Senate Health, Education, Labor, and Pensions Committee on June 16, 2026.
  • Provisions establish ongoing monitoring cycles (every 3 years) and require annual improper payment reporting.
  • GAO study due within 2 years after enactment, with a formal report to Congress.

This bill intends to bolster fraud prevention, impose stricter consequences for fraudulent activity, and improve overall integrity and accountability in federal child care funding.

Compiled from official sources — confirm details with the bill’s official record.

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