New Bill Would Tighten Fraud Screening Across Federal Awards

The recently introduced Fraud Prevention and Accountability Act establishes an enhanced fraud-prevention role for the Bureau of the Fiscal Service and a new permanent Inspector General for Fraud, Accountability, and Recovery (IG-FAR), both housed within Treasury and effective December 31, 2028.

For government contractors and grantees, the practical impacts could be significant. All potential awardees must be screened against a centralized fraud database before receiving awards or payments. Agencies will be required to share data on suspected fraudulent entities with Treasury, meaning past flags can follow contractors across agencies. Federal awards of $50,000 or more fall under the expanded oversight scope. Sub-recipients and sub-awardees are explicitly included in reporting obligations. The IG-FAR has broad investigative authority that extends beyond Treasury to all “covered funds.” Contractors operating under major spending programs — including infrastructure, CHIPS Act, and SBA loans — face heightened scrutiny and audit risk.