Texas is making bold moves to crack down on potential fraud in government assistance programs, with Governor Greg Abbott positioning the state as a willing partner in the Trump administration’s broader anti-fraud initiatives.
In a letter dated January 12, 2026, Abbott formally volunteered Texas to participate in a Housing and Urban Development pilot program aimed at rooting out fraud in federal affordable housing programs. The governor’s message to HUD Secretary Scott Turner emphasized the state’s eagerness to collaborate with the federal government on integrity measures.
“Taxpayers entrust government officials with the responsibility of administering programs efficiently and fulfilling clearly defined goals,” Abbott wrote to Turner. “We will gladly work with you to develop fraud-prevention measures that ensure federal taxpayer funds, like those in the rental-based assistance programs, are not taken advantage of by bad actors.”
Child Care Funding Under Scrutiny
The housing initiative isn’t Abbott’s only anti-fraud effort. The governor has also ordered a comprehensive probe into potential child care funding fraud, directing the Texas Workforce Commission and Health and Human Services Commission to investigate and deliver findings by February 27.
What sparked this sudden interest in childcare fraud? Recent scandals in other states appear to be the catalyst. “Recently, the Trump Administration and independent journalists have uncovered potential systematic fraud in subsidized child care systems in states like Minnesota,” Abbott said in his directive. “Such fraud will never be tolerated in Texas.”
Texas already boasts a relatively low improper payment rate of just 0.43 percent in its child care programs — significantly better than Minnesota’s approximately 11 percent. This success is largely attributed to existing anti-fraud processes implemented by state agencies.
Still, the governor wants to ensure Texas stays ahead of potential problems. The TWC has confirmed it will “take immediate action to implement the actions outlined by Governor Abbott, which will strengthen the agency’s current fraud prevention efforts.”
Part of a Larger Federal Crackdown
Abbott’s initiatives align with broader actions from the Trump administration, which recently froze over $10 billion in federal childcare funding to five Democrat-led states — California, Colorado, Illinois, Minnesota, and New York. The administration cited concerns about these states potentially funneling benefits to non-citizens.
Is Texas trying to get ahead of similar federal scrutiny? The timing suggests Abbott is positioning the state as a willing partner rather than a potential target.
“TWC is dedicated to continuing to root out waste, fraud, and abuse that might occur despite our strong fraud protections,” the agency stated, underscoring that Texas intends to maintain its reputation for program integrity.
In his letter to Secretary Turner, Abbott emphasized his commitment to the administration’s housing affordability goals, closing with: “I look forward to working with you and President Trump in combatting fraud, increasing the integrity of these programs, and Making Housing Affordable Again.”
For a state that prides itself on fiscal responsibility, Abbott’s proactive approach to fraud prevention appears designed to showcase Texas as the model for how government assistance programs should operate — efficient, accountable, and resistant to the scandals that have plagued other states.
