They do control what it's spent on. There are volumes of compliance about how you can spend the money. For example, can't use the funds on food, alcohol, paying rent, bribing people (yes, seriously, some idiot tried it and then they had to make a rule about it), you have to fly US carriers where possible, etc.

There are also reports you submit showing your progress and how you spent the money, to check that you are spending it on things you said you would.

This thread (not just the person I'm replying to) demonstrates a lot of misconceptions about why we have research funding, how it works, and what the results have been in practice. Please, everyone, don't rely on stereotypes of how you think research funding works.