False Claims Act Enforcement Hits Record Levels in 2025 Amid Policy-Driven DOJ Push

The False Claims Act (FCA) landscape underwent unprecedented transformation in 2025, with the U.S. Department of Justice setting new enforcement records and expanding the statute’s application to align with Trump Administration policy priorities.

DOJ shattered previous records with 1,698 new FCA cases filed during fiscal year 2025—nearly 300 more than the prior year. Of these, 1,297 were initiated by whistleblowers (qui tam relators), representing a staggering 32% increase from 2024’s previous high mark. Total recoveries reached $6.8 billion, more than double the previous year’s $3.1 billion and exceeding the prior record by $1.1 billion.

A significant shift emerged in the source of these recoveries, with declined cases (where DOJ chose not to intervene) accounting for 33% of total settlements and judgments—up dramatically from just 10% in 2024. This trend signals growing power for private whistleblowers, as evidenced by multiple nine-figure judgments secured in cases without government intervention.

Healthcare continued to dominate FCA recoveries, representing 83% of the total. A $1.64 billion judgment against a pharmaceutical company in March alone accounted for nearly a quarter of all FCA recoveries for the year.

The second half of 2025 saw DOJ leverage the FCA to advance Administration policies in several areas. A July memorandum from DOJ detailed specific diversity, equity, and inclusion (DEI) practices that could trigger FCA liability, following Executive Order 14173, which established compliance with federal anti-discrimination laws as “material” for FCA purposes.

In the trade arena, DOJ and the Department of Homeland Security launched a Trade Fraud Task Force in August, specifically encouraging whistleblowers to initiate qui tam actions against companies evading tariffs or importing prohibited goods. A December settlement with a tungsten carbide products distributor for $54.4 million—the largest customs-related FCA settlement ever reached—demonstrated the government’s commitment to this enforcement priority.

Late December also saw the Centers for Medicare and Medicaid Services propose rules prohibiting federal healthcare funds from being used for certain gender-related procedures for minors, creating new FCA risk for healthcare providers.

Several states enacted legislation restricting private equity firms’ involvement in healthcare operations. While not directly creating FCA liability like Massachusetts’ earlier 2025 amendments, these new state laws in California, Maine, and Oregon create compliance requirements that could trigger “implied false certification” claims under the FCA.

Notable judicial decisions in 2025’s second half included a First Circuit ruling that clinical laboratories may generally rely on physician orders to establish medical necessity, a D.C. Circuit clarification of the “original source” exception to the FCA’s public disclosure bar, and a Seventh Circuit affirmation of an FCA judgment against a drug manufacturer for excluding post-sale price increases from reported pricing.

As 2026 begins, companies face an FCA enforcement environment more aggressive and far-reaching than ever before, with DOJ continuing to deploy the statute as a primary tool for shaping policy across multiple sectors.