HR7155-119

What This Bill Does

The Stop Fraud in Federal Programs Act of 2026 strengthens criminal and audit rules for federal program integrity. Section 2 amends 18 U.S.C. 666, which covers theft, bribery, and fraud involving organizations or governments receiving federal funds. It replaces the existing maximum penalty of a fine, up to 10 years in prison, or both, with a fine defined as a covered amount, up to 20 years in prison, or both. Covered amount means the greater of $250,000 or twice the value of the property or things of value involved under the section's covered offenses. Section 3 amends the Richard B. Russell National School Lunch Act's Summer Food Service Program audit provision. Each service institution must annually have its accounts and records audited by a third-party auditor, and the auditor must submit results directly to the Secretary. The bill bars the service institution or sponsor organization from serving as the third-party auditor.

Who Benefits and How

Federal program beneficiaries, taxpayers, USDA Food Nutrition Service integrity staff, inspectors general, and federal prosecutors benefit from stronger deterrence, larger fines, longer prison exposure, and independent audit information. Third-party auditors benefit from new annual audit demand for Summer Food Service Program service institutions. Children served by summer meals may benefit if independent audits reduce diversion, theft, or weak recordkeeping.

Who Bears the Burden and How

People convicted under 18 U.S.C. 666 face higher penalties, including up to 20 years in prison and a fine of at least $250,000 or twice the value involved. Summer Food Service Program service institutions and sponsor organizations must pay for or arrange annual independent audits, maintain auditable records, and accept direct reporting to USDA. USDA staff must receive and use third-party audit results. Federal courts, defense counsel, and prosecutors must apply the new penalty formula.

Key Provisions

• Raises the maximum prison term for 18 U.S.C. 666 theft or bribery involving federally funded programs from 10 years to 20 years.
• Defines covered fines as the greater of $250,000 or twice the value involved in the covered offense.
• Requires annual third-party audits of Summer Food Service Program service institution accounts and records.
• Requires audit results to be submitted directly to the Secretary.
• Bars service institutions and sponsor organizations from serving as their own third-party auditors.