False Claims Act Enforcement Expanding Under New Administration

June 16, 2025 – False Claims Act (FCA) enforcement is gaining momentum under the current administration, despite reduced focus on other white-collar enforcement areas. The Justice Department is poised to expand FCA enforcement into new territories, including diversity initiatives, antisemitism on college campuses, transgender issues, and customs compliance, while maintaining robust activity in traditional sectors.

This expanded enforcement strategy creates significant new liability risks for a broad range of institutions from corporations to universities and healthcare providers.

From January through May 2025, the DOJ announced approximately 128 FCA settlements totaling $1.257 billion, maintaining pace with the previous administration’s enforcement levels. Healthcare and Paycheck Protection Program cases continue to dominate, representing 70% of settlements and over 80% of total recoveries.

Whistleblower actions remain crucial to enforcement efforts, with at least 65% of settlement value stemming from relator-initiated cases under the FCA’s qui tam provisions.

The healthcare sector continues to face intense scrutiny. In a significant recent action, DOJ filed an FCA lawsuit against three major insurers—Aetna, Elevance, and Humana—along with three insurance brokers—GoHealth, SelectQuote, and eHealth. The complaint alleges these companies engaged in a kickback scheme where insurers provided incentives to brokers who directed seniors toward the most profitable Medicare plans.

The case, initially brought by a whistleblower, was taken up by DOJ, which intervened and unsealed it on May 1. Although defendants reportedly intend to contest the allegations, the action signals healthcare will remain a central enforcement priority.

Beyond traditional sectors, DOJ has announced several new enforcement areas. Just one day into office, the President signed an Executive Order instructing agencies to enforce civil rights laws and eliminate what the administration characterizes as “unlawful DEI programs.”

In February, the Attorney General issued a memorandum directing the DOJ Civil Rights Division to pursue investigations against private companies and academic institutions receiving federal funds whose diversity practices allegedly “discriminate, exclude, or divide individuals based on race or sex.”

On May 19, the Deputy Attorney General announced a Civil Rights Fraud Initiative that explicitly targets FCA actions against federal contractors or funds recipients that “knowingly violate federal civil rights laws.” The initiative specifically identifies potential enforcement targets, including organizations with diversity programs that assign benefits based on race, ethnicity, or national origin, and federally funded universities that allegedly permit antisemitism on campus.

Notably, the memo “strongly encourages” private plaintiffs to file qui tam suits—effectively deputizing employees, students, and insiders as enforcement partners who can share in monetary recoveries. Under the FCA, whistleblowers may receive up to 30% of recoveries, which could amount to several times the value of federal contracts at issue when treble damages are applied.

Harvard University is reportedly already under investigation for potential FCA violations related to admissions practices following the Supreme Court’s Students for Fair Admissions decision, which struck down race-conscious admissions.

The administration is also targeting transgender issues through the FCA. On January 28, President Trump issued an Executive Order directing federal and state agencies to restrict gender transition medical treatments for minors. Following this, the Attorney General signaled DOJ would use the FCA to pursue healthcare providers who submit “false claims” to federal programs for transgender care for individuals under 19.

Customs and tariff compliance represent another emerging enforcement focus. In line with the new tariff regime announced in April, DOJ officials have emphasized the FCA’s role in addressing tariff evasion and trade violations. Michael Granston, Deputy Assistant Attorney General in DOJ’s Commercial Litigation Branch, called the FCA a “powerful tool” for these matters. With rising tariffs and intensified enforcement, FCA exposure risk in customs-related cases is expected to grow significantly.

For organizations receiving federal funds or contracts, these developments demand immediate attention. Federal contractors and grant recipients should review and enhance their compliance programs, internal whistleblower channels, and reporting procedures to ensure alignment with FCA requirements and federal civil rights laws as interpreted by the current administration.

Healthcare providers offering transgender care to minors should carefully assess their billing practices and coverage determinations, with particular attention to documentation, coding, and federal program reimbursements.

Businesses involved in importing goods need to proactively evaluate their tariff classification and documentation procedures to mitigate FCA scrutiny risks as DOJ increasingly links trade enforcement to FCA liability.

With these expanding enforcement priorities, the FCA continues to evolve as one of the government’s most powerful tools for pursuing alleged fraud against federal programs across an increasingly diverse range of sectors and activities.