FOR IMMEDIATE RELEASE
Monday, January 5, 2026
Contact: nahmed@ncdoj.gov
919-538-2809
RALEIGH – Today, Attorney General Jeff Jackson and Department of Health and Human Services Secretary Dev Sangvai responded to reports that the federal government may be freezing child care funding to all 50 states. At this time, North Carolina has not received official notice from the federal government about this action.
The Child Care and Development Fund (CCDF) is a federal grant program administered by the U.S. Department of Health and Human Services. It helps low-income families pay for child care so parents can work or attend school. States use the funds to reimburse child care providers, subsidize care costs for eligible families, and ensure basic safety and quality standards. North Carolina issues subsidy payments to child care providers after attendance is submitted, therefore the HHS notification sent on Monday, Jan. 5, 2026, does not apply to North Carolina.
CCDF requires states to have monitoring and reporting processes aligned with the federal funding compliance expectations. This includes subsidy compliance training for child care providers, random monitoring visits reviewing attendance and arrival/departure records, targeted technical assistance, investigations for reported cases of fraud, and corrective action plans to support providers with compliance. The NCDHHS Division of Child Development and Early Education (DCDEE) also works closely with the Office of Internal Auditor to establish and enforce additional measures to identify and decrease the occurrence of fraud. When overpayments are identified, funding is returned to the state.
“If fraud is discovered here, we will pursue it aggressively and make sure those responsible face consequences,” said Attorney General Jeff Jackson. “That’s what our fraud prosecutors do every day. When people steal taxpayer money, they’re stealing from kids and families. We have zero tolerance for it, and we’ll use every tool we have to stop it. The North Carolina Department of Health and Human Services has been a reliable partner in past efforts to uncover and stop fraud, and that partnership has helped us save taxpayers millions of dollars.”
“Our priority is making sure North Carolina’s children and families have access to the care and resources they need to thrive,” said NC Health and Human Services Secretary Dev Sangvai. “We are committed to strong oversight so child care dollars are used appropriately and reach the families they are intended to support. We are working closely with our federal partners to protect funding and minimize any disruption for children, families, and providers.”
“We must protect taxpayers to make sure their hard-earned money goes to provide important services like child care, not to line some crook’s pockets,” said Governor Josh Stein. “As Attorney General, I led the Medicaid Investigations Division, which has recovered more than $1 billion for the Medicaid program and obtained nearly 700 criminal convictions in fraud and abuse cases since its inception. We will continue to partner with the federal government to fight fraud and preserve child care funding.”
NCDHHS offers several ways to file a complaint or share concerns of Subsidized Child Care Assistance Program fraud:
- Call (800) 859-0829 (in-state only) or (919) 814-6300. Ask to speak to someone in the NCDHHS DCDEE Fraud Complaint Intake Unit (calls can be made anonymously).
- Email our webmaster at webmasterdcd@dhhs.nc.gov.
- Mail Information to: DCDEE 2201 Mail Service Center, Raleigh, NC 27699-2200.
Some recent examples of NCDOJ fighting fraud:
- Attorney General Jackson’s Special Prosecutions Section convicted a service dog owner who was fraudulently selling untrained service dogs to families with children with medical and developmental needs. The defendant will pay a total $353,000 in restitution to the families.
- Attorney General Jackson’s Medicaid Investigations Division won a $4.7 million judgment against a behavioral health company co-owner for billing for physician home visits that never occurred.
- Attorney General Jackson’s Consumer Protection Division and the North Carolina Secretary of State shut down a scam charity operation that raised $45 million for women with breast cancer but pocketed nearly all of the money.
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