Together, these announcements represent the most comprehensive projection to date of the new division’s planned organization, institutional ambitions, and substantive areas of focus. They are also DOJ’s most direct attempt so far to move beyond the widely observed reorientation in federal white-collar enforcement during 2025 and 2026. ⁴

The Fraud Division’s new announcements signal a recommitment to certain types of federal fraud enforcement. They express an intent to operate efficiently, to focus on data-sharing in investigations, and to emphasize the Department’s recent update to its corporate self-disclosures policy.

A New Division is Born

While many sections and offices within DOJ have pursued fraud cases over the years, the dedicated Fraud Division itself is brand new. President Trump announced its creation in January of this year, ⁵ and veteran federal prosecutor Colin McDonald was sworn in as the Division’s first Senate-confirmed leader in April.⁶ That same month, then-Acting Attorney General Todd Blanche announced a series of internal DOJ realignments to bring the new Fraud Division to life.⁷

Against that backdrop, the August 13 memorandum (“McDonald Memo” or “Memo”) announced a significant commitment of institutional capacity, along with five substantive enforcement priorities: (1) public trust and financial integrity; (2) health care; (3) internal revenue; (4) global trade and commerce; and (5) corporate misconduct.⁸ The final rule published on August 18 then clarified the Fraud Division’s overall jurisdiction,⁹ and the August 24 announcement expanded on the role of the new National Fraud Detection Center.¹⁰

Filling in the Fraud Division’s Structure

DOJ is drawing substantial resources from other Department components into the Fraud Division, with the McDonald Memo stating that the Division would increase headcount to approximately 500 attorneys and staff by late August 2026. The memorandum stated that the Division will continue growing, with “an aggressive plan to significantly increase the number of Division personnel dedicated to fighting fraud.”

The Fraud Division’s new organizational chart reveals an expansive architecture. The structure encompasses specialized litigating sections including a Public Trust and Financial Integrity Section, a Health Care Fraud Section, a Tax Section, a Global Trade and Commerce Enforcement Section, and a Corporate Enforcement Section. Another section will focus on detecting fraud through data partnerships, and several others will provide supporting functions.

The Division describes its organizational philosophy as “lean, flat, and agile, reducing excessive bureaucratic oversight.” The McDonald Memo conveys the impression that the Division will make faster charging decisions, perhaps with less centralized clearance required for individual line prosecutors to proceed. That possibility could be an important shift for respondents and targets counting on deliberative Main Justice review as a moderating influence.

The Division is already collaborating with U.S. Attorney’s Offices, as well as DOJ’s Civil Division and Criminal Division, federal law enforcement agencies, executive agencies, and state and local partners, with the Memo touting “new partnerships, breaking down data barriers and eliminating silos.” It will be interesting to see if Fraud Division lawyers are asked to meet case quotas similar to those reportedly imposed on prosecutors in U.S. Attorney’s Offices.¹¹

The Division’s build-out has become visible on the ground in recent months. Since this spring, the Division has announced a new West Coast Strike Force,¹² an expansion to the existing Health Care Fraud Midwest Strike Force,¹³ as well as a series of cases, collaborations, and data-sharing agreements in southeastern states.¹⁴

The National Fraud Detection Center is specifically designed to share data in support of investigating fraud on federal programs. The group reportedly will bring together the FBI, Homeland Security Investigations, IRS Criminal Investigation, FinCEN, more than a dozen Offices of Inspector General, and state-level partners to help generate criminal leads across federal programs.¹⁴ The Division has also announced data-sharing agreements with Centers for Medicare and Medicaid Services (“CMS”), the Federal Trade Commission (“FTC”), and Customs and Border Protection (“CBP”).¹⁶

Areas of Substantive Focus

The McDonald Memo identifies five substantive priority areas, each accompanied by specific enforcement theories. Many of these priorities will be familiar to companies and executives who have tracked DOJ’s anti-fraud efforts in recent years, especially those focused on fraud against federal programs.

• Public Trust and Financial Integrity. Government procurement fraud is identified as “a critical priority,” as are theories involving defective pricing, bid rigging, self-dealing, bribery, product substitution, and billing frauds. The memorandum identifies combatting this conduct as important to national security and military readiness. Benefit and grant program integrity is another area of focus, especially in programs relating to student loans, child care, veterans’ benefits, nutritional supplements, disaster relief, and small businesses.
• Health Care. Citing projected growth in national health care expenditures from over $3 trillion annually to over $7 trillion, the Division says it will target fraud relating to telemedicine programs, Medicare and Medicaid, controlled substance diversion, home health and hospice schemes, kickbacks, deceptive marketing of unsafe products and services, and “companies that cut corners to deceive regulators,” plus associated money laundering and tax charges.¹⁷  The Division promises to “supercharge” DOJ’s existing Health Care Fraud Strike Force model with greater resources and data analytics. The Division’s flagship health care action to date is a set of takedowns announced on June 23, in which 455 defendants were charged in 45 states and territories—including 90 doctors and other licensed medical professionals—amounting to over $6.5 billion in alleged false claims.¹⁸ Fraud in the health care and life sciences industry has long been a staple of DOJ fraud enforcement.
• Tax. The Division will have its own Tax Section, apparently drawing on staff from the recently shuttered standalone Tax Division. The Memo committed to deploying “the full arsenal of criminal tax tools paired with data analytics, financial forensics, and nationwide coordination” to “identify tax misconduct earlier” and “pursue tax offenders more efficiently.”¹⁹ In practice, we expect tax counts will also be bolted onto other fraud cases—expanding potential penalties, forfeiture exposure, and sentencing ranges.
• Global Trade and Commerce. The Memo commits the Division to lead DOJ’s coordinated criminal enforcement strategy against trade and customs violations and “supply chains polluted by forced labor” through the cross-agency Trade Fraud Task Force, focusing on “systemic, high-impact noncompliance.”²⁰ Named priorities include illicit transshipment schemes, country-of-origin fraud, undervaluation of imported goods to evade duties, sanctions evasion, and foreign forced labor schemes.
• Corporate Misconduct. The Division will continue DOJ’s historical practice of holding organizations accountable for violations and rewarding those that voluntarily self-disclose, cooperate, and remediate. The McDonald Memo states that the Fraud Division’s Corporate Enforcement Section will also aim to ensure fair and consistent application policies like DOJ’s new Corporate Enforcement and Voluntary Self-Disclosure Policy.²¹

Drawing Jurisdictional Lines

On August 18, the Department published a final rule formally establishing the Fraud Division’s authority within DOJ’s organizing regulations.²² The rule describes the Fraud Division’s mission as investigating and prosecuting “fraud against the American people” and as part of an effort to prosecute fraud “against taxpayer dollars and taxpayer-funded programs.”²³The rule assigns the Fraud Division jurisdiction over six categories of criminal proceedings:

• Criminal frauds. Criminal proceedings involving criminal frauds, except cases assigned to the Antitrust Division involving conspiracy to defraud the United States by violation of the antitrust laws.
• Internal revenue. Criminal proceedings arising under the internal revenue laws.
• Trade fraud. Criminal proceedings relating to the importation of goods, customs duties, tariffs, and foreign commerce.
• Government monies. Criminal proceedings involving monies owed to or paid by the United States.
• Health plan fraud. Criminal proceedings involving fraud or abuse with respect to health plans (e.g., Medicare, Medicaid, Medicare Advantage, PDP, etc.).
• Health care fraud and controlled substances. Criminal proceedings related to health care fraud and controlled substances distribution and diversion schemes.

The rule also grants the Fraud Division expansive catch-all authorities to prosecute federal criminal provisions charged alongside one of its core cases.

The rule draws these categories primarily from the Criminal Division’s existing mandate. It also amends 28 C.F.R. § 0.55 to carve tax fraud and health plan fraud out of the Criminal Division’s general fraud authority, while creating shared jurisdiction between the two on certain controlled substances laws.

Notwithstanding these changes, much of the Criminal Division’s traditional fraud portfolio remains intact. Under amended § 0.55(b), the Criminal Division retains authority over criminal fraud cases, except for matters specifically carved out for the Fraud Division (tax fraud and health plan fraud) or those already assigned to the Antitrust Division’s jurisdiction.

The Criminal Division’s longstanding Fraud Section—which historically handled the broadest range of DOJ’s complex economic crime cases—still exists, but with “Fraud” removed from its new title. That group has been rebranded as the White Collar and Corporate Enforcement Section. In practice, the rebranded section’s portfolio is expected to continue focusing on private-sector, market-facing, and corporate fraud, including Foreign Corrupt Practices Act (FCPA) matters, securities and commodities fraud, and other complex financial misconduct. The new Fraud Division will focus on fraud against government programs and public funds. The Criminal Division also retains the Money Laundering and Asset Recovery Section (MLARS) and other existing portfolios, while the Fraud Division will have similar groups within its own structure.

The rule also delegates special grand jury certification authority to the Fraud Division, mirroring the Criminal Division’s existing power under 18 U.S.C. § 3331. This means the Fraud Division can certify special grand juries in any federal judicial district, which is a tool that further supports the Division’s stated goal of operating with speed and nationwide reach.

The rule does not, however, resolve how authority will be divided in practice. The rule provides no formal mechanism for deconflicting overlapping matters beyond ad hoc agreements between the two divisions. For companies and individuals under investigation, the practical question of which Division is running a given case—and what that means for charging posture, cooperation credit, and the path to a resolution—will depend on internal DOJ coordination.

What to Expect

The Fraud Division’s recent announcements carry several practical implications for companies, executives, and their advisors:

• Enforcement should increase. The Fraud Division’s build-out to roughly 500 personnel, with representation in U.S. Attorneys’ Offices around the country and two more years of planned growth, points decisively in the direction of a commitment to enforcement and numbers that justify the new structure.
• Data—not just tips—will drive case selection. Data collaborations with CMS, the FTC, CBP, and state-level authorities will give the National Fraud Detection Center deep resources to mine for investigative leads. Companies may learn of an investigation only after the government has already modeled their billing, import, or claims data.
• A flatter Division means less centralized brake. The Memo’s stated reduction of “excessive bureaucratic oversight” and its deployment of prosecutors in the U.S. Attorneys’ Offices suggests faster, more decentralized decisions around charging and significant investigative steps.
• Tax charges will ride along. With a dedicated Tax Section inside the Fraud Division, companies and executives facing a fraud inquiry should expect the government to test the tax treatment of the same conduct—expanding potential penalties, forfeiture exposure, and sentencing ranges.²⁴
• Self-disclosure math may be more consistent going forward. With a single Department-wide cooperation policy in place, documented initial declinations under the new policy, and a renewed commitment to giving credit for meaningful cooperation, DOJ has emphasized the potential benefits of prompt voluntary self-disclosure. To be sure, uncertainty and risk remain, and companies will want to carefully assess the pros and cons of self-disclosure depending on specific facts and circumstances.
• Corporate declinations won’t shield individuals. The Fraud Division’s first declination under the new policy resolved the corporate investigation, but the company’s founder was still indicted. Companies considering self-disclosure should recognize that cooperation may simultaneously provide the government a roadmap to individual prosecutions. In that scenario, entity and officer interests can diverge quickly. Although not new, that dynamic is a reminder that companies and their counsel should account for potential conflicts at the outset of any disclosure decision.

Taken together, the Fraud Division’s McDonald Memo and the organizing final rule are just the beginning, of course. The new Division’s practical reach will depend on appropriations, retention of experienced white-collar prosecutors, and how courts treat any aggressive new theories. 

But for companies operating in any of the identified priority spaces—particularly health care providers, government contractors, grant recipients, importers, and private equity sponsors of any of these types of companies—it is clear that DOJ has rebuilt and rebranded its fraud enforcement program around protecting the public fisc, with both the capacity and the stated intent to use it.