The problem was especially acute for the Union. This of course was a direct result of the great advantage in material wealth enjoyed by the North. The Union army tried to purchase horses and got mules; when they purchased gunpowder they got sawdust, and so on. So I think that readers will find Shelby Foote’s treatment of this topic in his masterpiece The Civil War: A Narrative Vol. I quite interesting. In particular, Foote discusses problems related to General John C. Fremont and Secretary of War Simon Cameron. Take Fremont for example. Fremont served as the commanding Union General in the Western United States for a brief period during 1861. His command was brief primarily because of his megalomania and incompetence—a deadly combination if ever there was one—but there were other problems as well. Specifically Fremont had a graft problem. In fact more than $12 million disappeared from Fremont’s department during his brief three month stint in 1861. (That is more than $287 million in 2010 dollars.) Fremont was unable to account for this money – and Lincoln suspected that much of it had lined his own pockets and the pockets of his friends in the contracting business. In any event, then as now, a failure to be able to trace enormous amounts of money speaks for itself and Fremont was sacked as the war kicked off. Secretary of War Simon Cameron was another facet of the problem. In my estimation his problem is more typical of what we see in modern government. Foote writes: … for months [leading up to Cameron’s termination] there had been reports of waste and graft in the war department; of contracts strangely let; of shoddy cloth, tainted pork, spavined horses and guns that would not shoot; of the Vermont wholesaler who boasted, grinning, that “You can sell anything to the government at any price you’ve got the guts to ask.” 
Anyone who has ever googled the words “qui tam” or “federal False Claims Act” has certainly found the basic history of these concepts. In a nutshell, the history can be stated as follows: fraud on government coffers was rampant during the American Civil War (although Virginians do not find the name “Civil War” offensive, as a general rule we prefer the “War Between the States” which is more accurate.)