DOJ’s New Corporate Fraud Enforcement Directive Reflects Continued Focus on Trump Administration’s Policy Priorities

On October 1, 2026, Assistant Attorney General Colin M. McDonald issued Directive 26-12: Corporate Enforcement in the Fight Against Fraud, reinforcing the Department of Justice’s (DOJ) focus on corporate fraud enforcement. The directive reflects a continuation and formalization of enforcement priorities that have been developing throughout the year. Companies operating in health care, government contracting, tax, and international trade should understand the implications of the directive’s continued focus on Trump administration’s policy priorities and the DOJ’s specific quantitative thresholds that will inform prosecutorial decisions in corporate investigations. 

The Fraud Division: A New Enforcement Structure

Directive 26-12 comes from the newly created National Fraud Enforcement Division, a litigating division within the DOJ established earlier this year. President Trump announced the Fraud Division in January 2026 as part of his Task Force to Eliminate Fraud. In April 2026, Attorney General Todd Blanche charged the new division with adopting “a comprehensive and coordinated approach to investigating and prosecuting fraud against taxpayer dollars.” The creation of a dedicated division signals that fraud enforcement remains a sustained priority for this administration.

As highlighted in Foley’s recent article, the Fraud Division has been active since its launch. In August 2026, it launched the National Fraud Detection Center, a prosecutor-led, multi-agency team using data analytics to identify fraud across federal programs. These developments suggest that companies facing inquiries may encounter prosecutors with greater cross-program visibility and inter-agency coordination than in the past.

Policy Themes in Enforcement Priorities

Directive 26-12 identifies the DOJ’s enforcement priorities clearly, closely following the administration’s “America First” priorities. The memo focuses on four areas: health care, government programs, tax, and trade. Companies and organizations in each area should consider the distinct implications:

• Health Care: Companies and organizations billing federal health programs should evaluate their billing practices, medical necessity documentation, and relationships with referral sources. The directive’s focus on controlled substances means prescribing patterns, dispensing practices, and distribution controls warrant particular review. Given the DOJ’s data analytics capabilities, outlier billing patterns are increasingly detectable. The directive also lists Federal Food, Drug, and Cosmetic Act violations among the Division’s health care priorities, extending its reach to pharmaceutical, device, food, supplement, and cosmetics companies with no federal reimbursement exposure. Where applicable, companies should review quality systems, labeling and promotional practices, and FDA submissions, and should anticipate responsible-corporate-officer exposure for individuals.

• Government Contractors and Grantees: Companies and organizations receiving federal funds should review their certifications, cost accounting practices, and performance representations. The directive’s emphasis on procurement fraud suggests attention to compliance with contract terms, accurate invoicing, and truthful statements in proposals and claims. Small business and disadvantaged business certifications also may draw scrutiny.

• Tax: Companies should assess their tax reporting positions, particularly those involving complex structures, international arrangements, or aggressive planning. The directive’s reference to “internal or external revenue” suggests attention to customs duties alongside income taxes. Employment tax compliance such as worker classification and payroll reporting also is a likely focus area.

• Trade: Importers and companies with global supply chains should review tariff classifications, country-of-origin determinations, and valuation practices. The directive’s inclusion of “forced labor” means supply chain due diligence is no longer just a reputational concern — it carries potential criminal enforcement risk. Companies should evaluate their visibility into supplier labor practices and their ability to demonstrate compliance with import restrictions.

Across all four areas, the directive instructs prosecutors to place “great weight” on conduct involving the exfiltration of American dollars to foreign adversaries, immigration offenses, threats to American safety or military readiness, and tariff or importation violations. Companies with international operations, global supply chains, or diverse workforces should consider how these policy factors may intersect with their business activities.

The directive also sets quantitative thresholds that “must” inform prosecutorial decisions: conduct affecting three or more federal districts, impacting twenty-five or more victims, or creating $25 million or more in losses. Taken together, these priorities and factors provide a roadmap for understanding where the DOJ is likely to focus its attention over the next few years.

Centralized Oversight, Self-Disclosure, and Cooperation

The directive operationalizes the Corporate Enforcement Section within the Fraud Division, tasked with ensuring “the consistent, fair, and successful prosecution of corporate crime across the Division’s entire fraud portfolio.” Fraud Division prosecutors are now expected to work with the Corporate Enforcement Section at every phase of a corporate investigation from intake through resolution. Within seven days of the directive’s issuance, prosecutors were required to report all ongoing corporate investigations to the Section’s Chief.

For companies and their counsel, this centralization has practical implications. Resolution negotiations may involve prosecutors with a portfolio-wide view of corporate enforcement. The Corporate Enforcement Section will evaluate compliance programs, monitor post-resolution obligations, and assess outcomes across matters. Companies seeking cooperation credit will benefit from understanding how the Division applies its standards across cases.

The directive also reaffirms that companies demonstrating “a willingness to disclose misconduct, cooperate, and remediate” will receive appropriate credit under the Corporate Enforcement and Voluntary Self-Disclosure Policy (CEP). With the Fraud Division’s enhanced data analytics, cross-agency coordination, and whistleblower incentive programs, the ways misconduct may come to the government’s attention have expanded. The directive’s continued emphasis on cooperation credit underscores the value of proactive engagement, including effective internal reporting mechanisms, responsive compliance hotlines, and thoughtful self-disclosure protocols. These structural and policy developments have practical implications for how companies should approach compliance and risk management.

Key Takeaways

Directive 26-12 formalizes enforcement priorities that have been developing throughout the year. Companies in affected industries should consider the following:

• Conduct targeted risk assessments. The directive’s sector-specific priorities provide a framework for identifying where enforcement attention may focus. Companies should evaluate their exposure based on their industry, operations, and international footprint.
• Evaluate compliance program effectiveness. The Corporate Enforcement Section will assess compliance programs with a Division-wide perspective. Programs should be designed to detect the specific fraud risks the DOJ has prioritized, and companies should be prepared to demonstrate their effectiveness.
• Prepare for self-disclosure decisions. The CEP framework provides meaningful benefits for voluntary disclosure, but the calculus is fact-specific. Having counsel familiar with both the policy framework and current enforcement trends is important when these decisions arise.
• Monitor the evolving landscape. The Fraud Division’s centralized structure and data-driven approach represent a notable shift in how corporate fraud cases will be investigated and resolved. Staying informed about enforcement trends and resolution outcomes will help companies and their counsel navigate this environment.

Corporate fraud enforcement remains a clear priority for this administration. It continues to develop new means and methods to prosecute its enforcement priorities, such as making use of data analytics. Companies that understand the directive’s framework and take proactive steps to assess risk, strengthen compliance, and prepare for potential inquiries will be better positioned to respond if issues arise.

Foley is here to help you address the short- and long-term impacts in the wake of change. We have the resources to help you navigate these and other important legal considerations related to business operations and industry-specific issues. Please reach out to the authors, your Foley relationship partner, or to our Government Enforcement Defense and Investigations Group with any questions.