On August 13, 2026, Colin M. McDonald, Assistant Attorney General of the Department of Justice’s newly created National Fraud Enforcement Division, issued a memorandum outlining the Fraud Division’s enforcement priorities. The memorandum signals an ambitious expansion of federal fraud enforcement resources and a broad mandate to pursue fraud schemes that the Department views as threatening to the health, safety, security, and prosperity of Americans.
The Fraud Division intends to deploy its growing resources across five substantive enforcement priorities: (1) Public Trust and Financial Integrity, (2) Healthcare Fraud, (3) Criminal Tax Enforcement, (4) Global Trade and Commerce, and (5) Corporate Misconduct. Together, they emphasize the Department’s commitment to data-driven investigations, nationwide coordination, and corporate accountability. Companies operating in highly regulated industries, recipients of federal funds, government contractors, importers and exporters, healthcare providers, and multinational corporations should closely monitor these developments.
Key Takeaways
- The Fraud Division intends to significantly expand its personnel and enforcement capabilities, with approximately 500 attorneys and staff expected by August 24, 2026, and further growth planned over the next two years.
- Increased use of data analytics, financial forensics, technology-driven investigations, and cross-agency information sharing will be deployed as force multipliers in fraud detection and prosecution.
- The Fraud Division’s announced priorities place substantial emphasis on fraud involving government procurement and benefits programs, healthcare, taxes, customs and trade, sanctions evasion, and corporate misconduct.
- Companies that voluntarily self-disclose, cooperate, and remediate misconduct will continue to be rewarded.
Building a National Fraud Enforcement Apparatus
The Fraud Division has already established a nationwide enforcement footprint and prosecuted matters involving billions of dollars in alleged fraud since its launch earlier this year. The Department also announced an ongoing reorganization that will shift considerable resources into the Fraud Division and substantially increase staffing levels. In addition to specialized substantive sections, prosecutors will be supported by asset recovery attorneys, appellate counsel, corporate enforcement specialists, investigators, a dedicated privilege review team, automated litigation support personnel, and experts in data science and analytics. The Fraud Division will operate with an agile organizational model intended to accelerate investigations and prosecutions.
Public Trust and Financial Integrity
Protecting government programs, public funds, and the broader economy is one of the Fraud Division’s core enforcement priorities. In particular, the Fraud Division will prioritize investigations involving:
- Government procurement fraud;
- Defective pricing schemes;
- Bid-rigging;
- Self-dealing and bribery;
- Product substitution fraud;
- Billing fraud;
- Fraud involving grants and government benefits programs; and
- Fraud affecting student loans, veterans’ benefits, childcare assistance, disaster relief, and small-business support initiatives.
Healthcare Fraud
Healthcare fraud remains a major focus of federal enforcement. The Department estimates that a significant percentage of national healthcare spending is lost to fraud and identifies several areas of particular concern, including:
- Telemedicine fraud;
- Medicare and Medicaid fraud;
- Controlled substance diversion;
- Home health and hospice schemes;
- Kickback arrangements; and
- Misleading marketing of healthcare products and services.
Notably, the Fraud Division intends to leverage advanced data analytics and technology to identify large-scale healthcare fraud schemes and plans to expand upon the existing Health Care Fraud Strike Force model.
Criminal Tax Enforcement
Criminal tax enforcement will be integrated into the broader fraud enforcement mission. The Department identifies several categories of misconduct, including false tax return preparation, concealment of income, falsification of tax information, and promotion of allegedly unlawful tax schemes. The Fraud Division intends to use criminal tax statutes in conjunction with other fraud-related offenses and will employ data analytics, financial forensics, and nationwide coordination to identify tax misconduct earlier and pursue tax-related violations more efficiently.
Global Trade and Commerce
Most notable for multinational corporations, the memorandum identifies trade-related fraud as a key area of future enforcement activity. The Fraud Division will lead a coordinated criminal enforcement strategy targeting conduct that allegedly undermines US trade laws or border security interests.
The Fraud Division specifically identifies:
- Customs evasion;
- Illicit transshipment schemes;
- Country-of-origin fraud;
- Undervaluation of imported goods;
- Sanctions evasion schemes; and
- Supply chains involving forced labor concerns.
These matters will be pursued through a cross-agency Trade Fraud Task Force focused on systemic and high-impact violations affecting economic and national security interests. Companies with global supply chains, international sourcing operations, or significant import or export activity should pay close attention to this aspect of the Fraud Division’s agenda.
Corporate Misconduct
Corporate enforcement will remain a significant component of the Department’s anti-fraud strategy. The Fraud Division will continue to hold organizations accountable for misconduct while rewarding companies that voluntarily self-disclose, cooperate with investigations, and undertake meaningful remediation.
What Companies Should Do Now
Companies operating in sectors highlighted by the memorandum should consider reviewing:
- Government contracting and procurement compliance programs;
- Federal grants and benefits-related controls;
- Healthcare billing, reimbursement, and marketing practices;
- Tax compliance procedures;
- Trade, customs, sanctions, and supply-chain compliance programs; and
- Internal investigation, reporting, and remediation protocols.
As the Fraud Division grows and deploys enhanced data analytics capabilities, organizations should expect increasingly sophisticated government efforts to identify and investigate suspected fraud across multiple regulatory and enforcement domains.
Companies with questions about the memorandum’s implications for their operations, compliance programs, or potential enforcement exposure should consider engaging counsel to assess risk, evaluate existing controls, and develop an appropriate response strategy. Bracewell’s government enforcement and investigations team is available to help companies navigate these developments and prepare for increased scrutiny in these areas.
