DOJ Reports Record $6.8 Billion in False Claims Act Recoveries, Signals Intensified Enforcement

Federal prosecutors recovered a record-breaking $6.8 billion from False Claims Act (FCA) cases in fiscal year 2025, marking the highest annual total since the Department of Justice began tracking such statistics. The unprecedented figure signals an accelerating enforcement environment that government contractors should view with heightened vigilance.

The surge in recoveries was largely driven by a record 1,297 new qui tam lawsuits filed by whistleblowers – the most ever in a single year. Qui tam cases, which allow private citizens to sue on the government’s behalf and share in any recovery, generated $5.3 billion of the total, with whistleblowers receiving over $330 million in rewards.

While healthcare fraud remained the dominant source of recoveries at $5.7 billion, the Department of Defense recovered $633.9 million, and other federal agencies collected $532.6 million from alleged fraudulent activities.

“These statistics highlight a clear trend that all government contractors should note,” said legal expert Sarah Donovan from the Federal Contracts Advisory Group. “With whistleblower filings at an all-time high, companies face increased scrutiny from employees, competitors, and government auditors.”

Among the most significant procurement cases was a $428 million settlement with Raytheon over allegations of false cost data and double billing on Department of Defense contracts. DynCorp International agreed to pay $21 million to resolve claims it passed excessive and unsubstantiated subcontractor charges to the State Department.

Cybersecurity enforcement showed marked growth, with DOJ recovering more than $52 million across nine settlements – triple the amount from previous years. Notable cases included an $11.2 million resolution with HNFS/Centene and a $4.6 million settlement with MORSECORP, both centered on allegations that the companies certified compliance with security requirements they had not actually implemented.

Pandemic-related fraud continues to generate significant recoveries, with over $230 million collected in fiscal year 2025 alone and more than $820 million to date. The Small Business Administration has intensified scrutiny of pandemic relief programs, including the Shuttered Venue Operators Grant and Restaurant Revitalization Fund.

International trade compliance has emerged as an expanding frontier for FCA enforcement. A $54.4 million settlement with Ceratizit USA LLC over alleged evasion of duties on Chinese tungsten carbide products marked the largest customs fraud resolution in FCA history. The DOJ’s Trade Fraud Task Force, launched in August 2025 in collaboration with the Department of Homeland Security, has specifically identified the FCA as a key mechanism for pursuing tariff evasion cases.

Small business program fraud also remains in prosecutors’ crosshairs. In June 2025, DOJ announced guilty pleas from a USAID official and three executives involved in a decade-long bribery scheme that resulted in $550 million in fraudulent 8(a) Business Development Program awards. More recently, the SBA suspended approximately 1,100 firms from the 8(a) program following a comprehensive audit.

Perhaps most surprisingly, the DOJ has signaled a new enforcement focus on diversity, equity, and inclusion practices. In May 2025, prosecutors launched a Civil Rights Fraud Initiative targeting DEI policies and alleged antisemitism among corporations and higher education institutions. By December, multiple media outlets reported that DOJ had issued civil investigative demands to several large companies regarding their DEI practices.

Industry experts recommend that contractors take several proactive steps to mitigate FCA risks, including:

• Documenting evidence supporting all contract certifications
• Implementing robust pricing controls and subcontractor oversight
• Ensuring cybersecurity capabilities match reported compliance levels
• Maintaining effective internal reporting channels for potential issues
• Verifying customs classifications and origin documentation
• Reviewing small business program compliance
• Ensuring DEI policies align with current administration directives

“The record-breaking numbers we’re seeing aren’t just statistics – they represent a fundamental shift in enforcement priorities and resources,” noted compliance attorney Michael Reynolds. “For government contractors, the message couldn’t be clearer: proactive compliance is no longer optional, it’s essential.”