Fraud tactics have evolved. Your controls need to catch up.
The COVID-19 era exposed a harsh reality: digital applications, remote verification, and high-volume electronic payments allow bad actors to scale schemes faster than traditional audits can detect them.
In 2025, the Department of Justice continued prosecuting the Feeding Our Future fraud—a scheme built on fabricated meal counts, fake rosters, and fraudulent invoices that exploited gaps between speed and verification.
The pattern is clear: Modern fraud schemes exploit three weaknesses—manipulated identity signals, manufactured transactional data, and payment paths designed to make recovery impossible.
For public sector leaders managing federal programs, the historic model of post-payment review and annual audits is no longer sufficient. Program integrity now demands real-time eligibility validation, data quality controls, and payment systems that can withstand investigative scrutiny.
This isn't theoretical. Federal policy is moving fast:
OMB revised 2 CFR Part 200 with mandatory fraud disclosure requirements Single audit threshold raised to $1 million—narrowing coverage while risk increases HHS froze program funds in five states over fraud concerns (January 2026) Agencies are restricting payment access when documentation doesn't support integrity
The solution isn't slowing down programs. It's building controls that operate at disaster scale.