On February 20, 2025, during a speech to the Federal Bar Association’s annual qui tam conference, Michael Granston, Deputy Assistant Attorney General for the Commercial Litigation Branch at the U.S. Department of Justice (DOJ), said that the Trump Administration will seek to “aggressively” enforce the False Claims Act (FCA). In particular, Granston stated that active FCA enforcement is consistent with the Trump Administration’s priorities of increasing government efficiency and “rooting out waste, fraud and abuse.”
Granston stated that DOJ will focus enforcement of the FCA on the Trump Administration’s policy priorities beyond DOJ’s typical targets, specifically identifying foreign trade issues and tariffs. To that end, he identified efforts to enforce payment of customs duties on imported goods as a key example of new enforcement activities and reiterated that enforcement against “illegal foreign trade practices” would be a priority for the Administration. These statements come on top of other comments from Trump Administration officials stating that diversity, equity, and inclusion (DEI), domestic sourcing / industry, pandemic relief, and cost-related considerations will be among the Trump Administration’s key enforcement priorities. This, in turn, raises compliance risks in connection with a number of industries, ranging from the healthcare and government contracting industries that are typically at risk for FCA enforcement action, to federal grant recipients, educational institutions and cybersecurity, import/export, freight forwarding, and infrastructure companies.
Granston’s remarks were made one day before the U.S. District Court of Maryland preliminarily enjoined the provision concerning certifications under the FCA in Executive Order 14173, “Ending Illegal Discrimination and Restoring Merit-Based Opportunity,” (Jan. 31, 2025). This Executive Order requires a term in every procurement contract or grant award that compliance in all aspects with all applicable Federal anti-discrimination laws is material to the government’s payment for purposes of the FCA. Even before this Executive Order was issued, however, all existing federal contracts and grant awards, including for educational institutions, already require compliance with certain requirements, including applicable federal anti-discrimination laws, as a term and condition for receiving federal funds. DOJ may assert that such existing requirements are not as a result of the preliminarily enjoined provision in this Executive Order and, thus, remain subject to enforcement considerations.
During his remarks, Granston praised DOJ’s “efficient” enforcement of the FCA, noting that healthcare fraud investigations paid back government investments nearly threefold the actual cost of such fraud. Granston also characterized strong FCA enforcement as a deterrent, noting that the Centers for Medicare and Medicaid Services had determined that $10 in potential fraud is deterred for every $1 recovered.
Granston also stated that DOJ has improved its enforcement efforts, referencing DOJ’s “increasing reliance” on data analytics to identify potential fraud among healthcare payments. Such data analysis is used to determine trends, “extreme outliers,” and other indications of illegal payments or relationships. While DOJ’s use of data analytics in FCA enforcement predates the change in Administration, it comports with the data-driven approach that the Department of Government Efficiency (DOGE) is using in an effort to reduce government spending across the Executive Branch. The issues that DOGE identifies could be referred to enforcement authorities for further action, including under the FCA.
McGuireWoods continues to monitor the rapidly evolving legal, regulatory, and enforcement landscape in the early months of the Trump Administration.
Companies or organizations with questions as to this anticipated increase in enforcement of the FCA, or other general FCA inquiries, are encouraged to contact any of the authors or another member of the McGuireWoods False Claims Act, healthcare, government contracting, education, and DEI practices.