DOJ Signals Continued Aggressive Enforcement of False Claims Act

In a recent address at the Federal Bar Association’s 2026 Qui Tam Conference, the Department of Justice signaled a continuation of aggressive False Claims Act (FCA) enforcement across multiple sectors, highlighting both traditional and emerging priorities that could significantly impact businesses dealing with the federal government.

Brenna Jenny, deputy assistant attorney general for the DOJ’s Commercial Litigation Branch, outlined several key enforcement areas, with healthcare remaining at the forefront of the department’s focus. The DOJ will continue scrutinizing managed care organizations, particularly targeting unsupported risk-adjusted diagnosis codes, improper chart reviews, and fraudulent enrollment practices.

Drug pricing has also emerged as a critical priority, reflecting the administration’s broader commitment to reducing pharmaceutical costs. Investigations are increasingly examining inaccurate pricing information, inconsistent application of pricing rules, and potentially problematic co-pay assistance programs that could influence drug utilization or mask price increases.

“Even where harm has not materialized or cannot be precisely quantified, meaningful risk alone may support enforcement action,” Jenny noted, signaling that potential danger to patients or program integrity remains sufficient grounds for DOJ intervention.

Trade fraud has become another significant enforcement target, with a cross-agency Trade Fraud Task Force meeting monthly to coordinate investigations. Recent years have seen record numbers of trade fraud qui tam actions and settlements, particularly involving goods imported from China. The DOJ is focusing on three primary categories: misclassification of imports to reduce duties, deliberate undervaluation of goods, and false declarations about country of origin to circumvent tariffs.

In a notable expansion of the FCA’s application, the DOJ is now prioritizing investigations of government contractors for potential violations of federal antidiscrimination laws. Jenny specifically highlighted problematic practices including demographic goals, “diverse slate” hiring policies, compensation tied to diversity outcomes, and exclusive executive training programs based on protected characteristics.

“Compliance with federal antidiscrimination laws will be treated as material to government contracting decisions,” Jenny emphasized, suggesting that in severe cases, the government could seek damages equivalent to the full value of the contract where discriminatory practices were misrepresented.

The DOJ’s enforcement approach is increasingly data-driven, with sophisticated analytics platforms now capable of identifying outlier patterns that may indicate fraud. These systems can flag potential issues before whistleblowers even come forward, often allowing investigators to develop a comprehensive understanding of alleged misconduct before issuing civil investigative demands.

“By the time we reach out to a company, we typically already have a detailed, evidence-backed view of the situation,” Jenny explained. This technological advancement underscores the importance of companies conducting early internal reviews and preparing for evidence-based discussions with investigators.

Regarding case dismissals under 31 U.S.C. § 3730(c)(2)(A), Jenny reported that the Civil Division is now systematically evaluating potential dismissals at the point of declination and throughout case development. This more structured approach has resulted in a record number of dismissals in the past fiscal year.

Jenny also provided clarity on arguments that rarely persuade the DOJ to abandon investigations. Claims that misconduct is too old, that continued government payment indicates immateriality, or that problematic practices are standard industry procedures typically carry little weight. In fact, widespread noncompliance may actually increase DOJ interest, as it could signal systemic risk to government programs.

On regulatory matters, Jenny emphasized that subregulatory guidance will not, by itself, create legal obligations or serve as a basis for enforcement actions. The department treats such guidance as informative rather than binding, focusing enforcement decisions on substantive violations rather than technical noncompliance with guidance.

For businesses interacting with the federal government, these developments highlight the critical need for robust compliance programs, proactive risk assessments, and internal reviews. Companies should assume that enforcement agencies may already have extensive data about potential issues before making contact, making early preparation and evidence-based engagement strategies increasingly important in addressing FCA exposure.