Over the past year, the Trump Administration has prioritized the False Claims Act (“FCA”) as a primary weapon to combat federal program fraud. Most recently, in May, Assistant Attorney General Brett A. Shumate of the US Department of Justice’s (“DOJ”) Civil Division announced new guidelines to accelerate the investigation and prosecution of qui tam whistleblower actions that allege fraud on federally funded, state-administered benefits programs. Specifically, AAG Shumate’s memorandum (the “Shumate Memo”) provides for:
- Expedited government investigation of qui tam complaints through mandatory DOJ review timeframes of no more than 120 days;
- An increased role for relators in developing evidence in FCA investigations; and
- Improved coordination among government agencies in which benefits-fraud allegations may be simultaneously reviewed for civil, criminal, and administrative enforcement.
Deeming the FCA “one of the government’s most powerful weapons for fighting fraud and ensuring that government funds are spent properly,” the Shumate Memo reflects the DOJ’s latest effort to aggressively combat fraud involving federal programs.
The Trump Administration’s efforts have paid off. 2025 marked a record-breaking year for FCA fines, and 2026 looks to be on par with the previous year. Companies that conduct business with the federal government – whether in health care, government contracts and defense, or through customs and tariffs – should reexamine their compliance programs to ensure procedures are in place to prevent the knowing submission of inaccurate claims to the government.
Link to What is the False Claims Act? What is the False Claims Act?
The FCA is a civil statute that imposes treble damages and penalties on parties that knowingly submit false claims to the government or improperly avoid obligations owed to the US. As the government’s primary civil fraud enforcement tool, the FCA protects a wide range of federal programs and services, from health care and disaster relief to military, infrastructure, loan, and grant programs.
In 2025, the DOJ recovered over $6.8 billion from settlements and judgments under the FCA – the highest in a single year in the history of the FCA, originating from 1,297 qui tam lawsuits and 401 investigations – with health care fraud remaining the leading source.
Link to The Trump Administration’s Recent Efforts to Strengthen the False Claims Act The Trump Administration’s Recent Efforts to Strengthen the False Claims Act
Following its record-breaking recovery year under the FCA, the Trump Administration has introduced several initiatives to strengthen its efforts to detect and prosecute federal program fraud. In March 2026 through Executive Order 14395, the Trump Administration launched the Task Force to Eliminate Fraud and the National Fraud Enforcement Division (“NFED”) to enhance its war on fraud, waste, and abuse in federal programs.
The Task Force to Eliminate Fraud was established to coordinate a comprehensive national strategy to stop fraud, waste, and abuse in federally funded benefits programs such as housing, food assistance, medical care, and cash assistance.
Similarly, the Trump Administration stood up the NFED with a mission to “zealously investigate and prosecute” those who steal or fraudulently misuse taxpayer dollars. The NFED supports the Task Force to Eliminate Fraud in investigating and prosecuting fraud involving taxpayer dollars and taxpayer-funded programs nationwide.
In addition, in April, DOJ’s Civil Division announced the Fraud Oversight through Careful Use of Statistics (FOCUS) initiative, which aims to partner with data miners to analyze publicly available government data for potential fraud. DOJ touted data miners as a potential new source of FCA leads, in addition to traditional insider whistleblowers. It remains to be seen whether data mining will fuel FCA investigations going forward.
On the same day, DOJ’s Fraud Division launched the West Coast Health Care Fraud Strike Force, expanding its efforts to combat health care fraud across Arizona, Nevada, and Northern California. Working in coordination with the Department of Health and Human Services Office of Inspector General, the FBI, DEA, and other law enforcement partners, the Strike Force is tasked with identifying, investigating, and prosecuting health care fraud schemes.
And most recently, in August 2026, the DOJ announced the launch of the National Fraud Detection Center to combat fraud against tax payer funded programs in collaboration with various agencies and departments across the federal government.
Link to The Shumate Memo The Shumate Memo
Building on these initiatives, the DOJ issued the Shumate Memo to prioritize and fast track FCA cases.
Link to Accelerated Qui Tam Review Accelerated Qui Tam Review
The Shumate Memo seeks to accelerate DOJ review of new qui tam cases and shorten the time they remain under seal. Although the FCA provides the government with 60 days to decide whether to intervene in a qui tam action, courts routinely grant DOJ requests for extensions, often keeping cases under seal for years.
Under the new guidance, DOJ attorneys are expected to complete their initial review of benefits-fraud qui tam cases within the statutory 60-day period and, in most cases, no later than 120 days. At the end of that review, DOJ must either: (1) allow the relator to proceed, (2) continue investigating, or (3) seek dismissal of the action.
If additional investigation is warranted, DOJ generally has a 120-day investigative period to decide whether to intervene. Any extension requires escalating internal approvals – first from the Deputy Assistant Attorney General of the Commercial Litigation Branch and, for subsequent extensions, from the Assistant Attorney General for the Civil Division – in addition to obtaining court approval as required by the FCA.
Link to Increased Role for Relators Increased Role for Relators
The Shumate Memo also encourages DOJ attorneys to make greater use of relators and their counsel to supplement government resources. Under the new guidance, DOJ may allow relators to promptly litigate smaller, straightforward benefits-fraud cases with strong factual support, potential damages under $10 million, and aggravating factors such as beneficiary harm or ongoing misuse of federal funds.
The DOJ expressly acknowledges that this approach will increase the number of benefits-fraud cases primarily litigated by relators, enabling the government to focus its resources on the largest and most complex fraud schemes.
Link to “Whole-of-Government” Approach “Whole-of-Government” Approach
In addition, the Shumate Memo underscores the Trump Administration’s emphasis on cross-government coordination in fraud enforcement. Consistent with the DOJ’s broader “whole-of-government” approach, which has been a central theme of federal enforcement efforts since 2025, the Shumate Memo signals an effort to coordinate across agencies and jurisdictions to identify, investigate, and pursue fraud more comprehensively and efficiently. Under the Shumate Memo, the DOJ will refer appropriate cases to the Criminal Division and/or NFED for potential criminal prosecution, as well as to the affected federal agency for possible administrative remedies.
Through the “whole-of-government” approach, a single qui tam complaint could result in FCA litigation, a criminal investigation, payment suspension, and even suspension or exclusion from federal program participation.
Link to 2026 FCA Prosecutions May Surpass 2025 2026 FCA Prosecutions May Surpass 2025
Recent DOJ press releases indicate that FCA enforcement remains strong and could accelerate. With cases moving more quickly from filing to investigation, more relators being permitted to litigate, a reduced DOJ backlog, a more coordinated enforcement approach outlined in the Shumate Memo, and the launch of the National Fraud Detection Center, FCA actions are likely to continue increasing and may surpass the record-setting levels seen in 2025. Since the release of the Shumate memo in May, DOJ has announced dozens of FCA resolutions against health care providers and government contractors, including:
- In June 2026, two health care networks and their founder agreed to pay $56,500,000 in response to a qui tam action alleging they caused the submission of false diagnosis codes under the Medicare Advantage program.
- In July 2026, a pharmaceutical company was ordered to pay over $4,600,000 to resolve FCA allegations that they violated the FCA by paying kickbacks to Ambulatory Service Centers (ASCs) to induce them to purchase and dispense an injectable drug for the treatment of ocular inflammation following cataract surgery.
- In August 2026, a US water, environment, and sustainable infrastructure consulting and engineering company agreed to pay $57 million to resolve FCA allegations involving falsifying soil test results at a Navy shipyard.
- Also in August 2026, a US-based technology infrastructure provider agreed to pay $1.8 million to resolve allegations that they violated the FCA by falsely certifying that the company met applicable data center standards provided under a contract with the US Securities and Exchange Commission.
- And again, in August 2026, a healthcare provider group agreed to pay over $500 million to resolve allegations disclosed through the US Department of Health and Human Services Office of Inspector General’s Health Care Fraud Self-Disclosure Protocol that the provider violated the FCA by submitting false diagnosis codes in order to increase payments received from the Medicare Advantage program.
Link to Key Takeaways For Companies That Do Business with the Federal Government Key Takeaways For Companies That Do Business with the Federal Government
The Shumate Memo underscores the Trump Administration’s continued emphasis on preventing, investigating, and prosecuting fraud against the federal government, particularly through the FCA. The increased pace of FCA enforcement in the benefits and health care fraud space highlights the importance of proactive compliance measures.
There are indications that the Trump Administration may take a more lenient enforcement approach in certain cases where a company voluntarily self-discloses misconduct, fully cooperates with the DOJ’s investigation, promptly remediates the underlying issues, repays ill-gotten gains, and provides appropriate restitution. This approach was reflected in July 2026 in the DOJ’s first publicly announced “declination to prosecute” following its rollout of the new Department-wide Corporate Enforcement Policy. This declination, for a management services organization, signaled a willingness on behalf of DOJ to reward companies that proactively identify, disclose, and address wrongdoing.
Companies should take this heightened enforcement environment as a signal to reassess and strengthen their policies, procedures, and internal controls to identify and address potential risks before they become enforcement issues. In particular, companies operating in highly regulated industries like health care should consider:
- Conducting routine audits to catch the submission of false claims to the government;
- Implementing an effective reporting mechanism so that employees disclose potential violations first to the company; and
- Providing training tailored to the company’s industry.
Ultimately, the Shumate Memo serves as a clear indicator that federal enforcement activity is expected to remain aggressive, making proactive compliance and risk mitigation more important than ever.