The North Carolina Department of Justice and the North Carolina Department of Health and Human Services (NCDHHS) have addressed concerns about a recent federal notification regarding potential freezes in child care funding. The Child Care and Development Fund (CCDF), managed by the U.S. Department of Health and Human Services, supports low-income families by helping them pay for child care so parents can work or attend school. North Carolina distributes subsidy payments to providers after attendance is reported, making the recent federal notice issued on January 5, 2026, not applicable to the state.
CCDF regulations require states to maintain monitoring and reporting systems that comply with federal standards. These include provider training on subsidy compliance, random monitoring visits to review records, technical assistance for providers, investigations into suspected fraud cases, and corrective action plans when needed. The NCDHHS Division of Child Development and Early Education works with the Office of Internal Auditor to implement measures aimed at reducing fraud. If overpayments are found, funds are returned to the state.
Attorney General Jeff Jackson stated: “If fraud is discovered here, we will pursue it aggressively and make sure those responsible face consequences. 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.”
NC Health and Human Services Secretary Dev Sangvai said: “Our priority is making sure North Carolina’s children and families have access to the care and resources they need to thrive. 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.”
Governor Josh Stein added: “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. 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.”
The North Carolina Department of Justice serves as a statewide agency overseeing legal matters such as consumer protection programs, crime analysis initiatives, law enforcement training programs supporting public safety efforts across North Carolina (official website). Its mission includes preventing crime while safeguarding constitutional rights for residents throughout the state.
The Attorney General’s office provides legal representation for state agencies in court proceedings including criminal appeals (official website). It also offers services such as criminal prosecution support alongside consumer protection activities (official website). Jeff Jackson currently leads this office as attorney general (official website).
NCDHHS encourages individuals who suspect Subsidized Child Care Assistance Program fraud or wish to file complaints about misuse of funds within these programs to come forward.
