Month: January 2026

The DOJ’s Empty Boast

Since the beginning of Trump’s second term, the Justice Department has expended much of its energy bringing dubious cases against the president’s political foes and propping up the administration’s disastrous immigration policies.

At the same time, DOJ is trying to portray itself as an aggressive prosecutor of corporate crime. I previously wrote about the department’s exaggerated statements concerning its enforcement of the False Claims Act, the law used to bring civil actions against dishonest government contractors.

DOJ is also making Trump-style boasts about its track record with regard to criminal fraud cases. A recent press release about the performance of the Criminal Division’s Fraud Section in 2025 was filled with terms such as “historic,” “recording-setting,” and “cutting edge.” The release is touting the fraud section’s Year in Review report, which is a bit less bombastic but is still prone to overstating DOJ’s accomplishments.

The fraud section’s four units, each of which prosecutes individuals as well as corporations, cover Foreign Corrupt Practices Act cases; Health Care Fraud; Health and Safety cases; and Market, Government, and Consumer Fraud.

Let’s focus on the FCPA criminal cases against corporations, which over the years have included some of the DOJ’s biggest prosecutions. When you get past the report’s self-congratulatory introductory material and reach the actual statistics, it turns out that DOJ handled a grand total of 3 FCPA cases against corporations during 2025.

Only one of the three cases was of any real significance: TIGO Guatemala, a subsidiary of Millicom International Cellular, paid $118 million to resolve an investigation of bribes paid to government officials in Guatemala.

In another of the cases, DOJ actually declined prosecution of Liberty Mutual for bribes paid to government officials in India because the company voluntarily disclosed the misconduct. Liberty Mutual’s sole penalty was the disgorgement of $4.7 million in profits.

The third FCPA case DOJ takes credit for has not yet been resolved. In fact, the action was originally filed in 2023 during the Biden Administration against an individual. In October 2025 DOJ added SGO Corporation, doing business as Smartmatic, as a defendant. The matter is pending.

This is hardly an impressive performance for a period of 12 months. According to data collected for Violation Tracker, the Biden Administration resolved 23 FCPA cases against corporations with a total of $3.4 billion in fines and settlements. That’s an average of about 6 cases and $850 million per year.

The Obama Administration resolved 73 cases against corporations with $6 billion in fines and settlements over its two terms, or an average of about 9 cases and $750 million per year.

Trump’s first term did even better, with an average of $1.9 billion in penalties per year. That figure was boosted by a $2.9 billion settlement with Goldman Sachs in 2020.

Clearly, Trump 2.0 has nothing to brag about in terms of FCPA criminal enforcement. This is just another example of how an administration that is devoted to the needs of business, especially those companies chummy with Trump, feels a need to give the false impression that it is tough on corporate misconduct.

A False Claim About False Claims

When the Trump Administration issues a press release about regulation, it is usually to boast about the number of rules it is trying to abolish or to announce a reduction in a corporate penalty imposed during the Biden Administration.

That’s why it was surprising recently to see a release from the Justice Department bragging that it collected more than $6.8 billion in settlements and judgments under the False Claims Act during the 2025 fiscal year, an amount it claimed was the highest annual total in the history of the FCA, which covers cases of fraud by government contractors.

To make sense of this announcement, we first need to recognize that it has no basis in fact. According to data collected for Violation Tracker, the FCA collections during FY 2025 were actually $2.06 billion, far less than the amount claimed by DOJ.

Admittedly, Violation Tracker covers only those cases brought against corporations and other business entities, both for-profit and non-profit, while excluding cases brought against individuals. Yet it is highly unlikely that cases against individuals would bring in more than twice the amount recovered from companies.

The DOJ may also be including cases that are still under appeal, whereas Violation Tracker covers only matters that are fully resolved.

The $2 billion total is far from the largest annual FCA figure in Violation Tracker. It is slightly above the average of the annual totals going back to FY 2001, which is earliest full year of coverage in the database, and well below the annual average of $2.6 billion for the past ten fiscal years. Putting aside those fiscal years overlapping presidential administrations, the FY2025 total is lower than the amounts during the last few years of the Obama Administration and each of those during the Biden era. It is also below the annual totals during all but one of the years of Trump’s first term.

It is far from surprising to see a branch of the Trump Administration play fast and loose with the facts. Yet it is unclear why a regulation-bashing, corporate-friendly administration would distort the truth to depict itself as more aggressive on enforcement than it actually is.

I can think of two reasons. The first is that False Claims Act cases fit neatly with the MAGA notion that the U.S. government is being taken advantage of. The contractors cheating federal agencies are seen as the domestic counterpart to the NATO countries that are supposedly mooching off Uncle Sam to cover their defense costs.

Even if the DOJ’s claim about FCA collections is highly inflated, it is true that the administration has been pursuing such cases aggressively at a time when many other regulatory agencies have been neutered. For example, the DOJ recently announced that Kaiser Permanente will pay $556 million to settle an FCA case alleging it engaged in a scheme to inflate its Medicare Advantage reimbursements by pressuring physicians to add invalid diagnoses to their records of patient visits. This is among the half dozen largest FCA settlements of the past decade.

A focus on FCA cases would be far from the worst thing to come from the MAGA grievance worldview. Corrupt contractors are, in fact, cheating the federal government and deserve to be prosecuted.

It is also possible, however, that the administration is setting the stage for a less palatable use of the FCA. In recent weeks there have been reports that DOJ is planning to use the FCA as the legal justification for bringing cases against contractors which do not completely conform with the administration’s position on diversity and inclusion. In other words, a company that retains any vestige of DEI while doing business with a federal agency would be considered to have cheated the government.

The FCA has a long history of serving as the key legal mechanism by which the federal government deals with corrupt contractors. Using false claims cases to attack DEI rather than financial fraud would be a betrayal of that history.

As with many other Trump policies, it is difficult to discern the administration’s real motivation in its FCA practices. We can only hope the DOJ focuses on the real culprits.

Unequal Justice

These are strange days at the Department of Justice. Attorney General Pam Bondi seems completely willing to do the bidding of Donald Trump, yet there have been press reports that he is unhappy she has not moved faster to prosecute his perceived political foes. The DOJ is not conducting a probe of the ICE officer who fatally shot a woman in Minneapolis, but it is investigating the political ties of the woman’s spouse. Investigations are also underway involving members of Congress who posted messages reminding servicemembers that they are not required to obey illegal orders.

Amid this insanity, it turns out there are people at the DOJ who are still doing their job in a normal way, particularly with regard to the prosecution of corporate crime. The Department just announced that it has reached a $556 million settlement with Kaiser Permanente to resolve allegations that the health system engaged in a scheme to inflate its Medicare Advantage reimbursements by pressuring physicians to add invalid diagnoses to their records of patient visits. Kaiser was said to have linked physician and facility financial bonuses and incentives to their cooperation with the scheme.

Kaiser is far from the only company to face accusations of cheating Medicare Advantage, the portion of Medicare most like an HMO. In 2023 insurer Cigna paid over $170 million to resolve a case involving diagnostic codes. In 2025 Seoul Medical Group paid $58 million to settle accusations it submitted false diagnosis codes for two spinal conditions to increase payments from Medicare Advantage.

UnitedHealth Group is being investigated by DOJ over similar issues and was the focus of a recent Senate Judiciary Committee report suggesting that the company abuses the Medicare Advantage provisions that provide higher payments relating to patients with certain costly medical conditions.

The Trump Administration is giving cases such as these a lot less attention than the purported fraud being committed by Somali-run child care centers in Minneapolis. Lately, Trump has been threatening to revoke the naturalized citizenship of those convicted of fraud.

Fraud is a non-violent financial crime, yet Trump is proposing a punishment that has previously been reserved for the likes of naturalized citizens who turned out to be Nazi war criminals. The penalties being imposed on healthcare companies are, by contrast, a lot milder. Some of the monetary amounts are substantial, but they can easily be absorbed by an operation such as Kaiser Permanente, which takes in over $100 billion a year in revenue.

If the healthcare penalties were to be truly comparable to those confronting Somali-Americans, those companies would be faced with the possibility of losing their corporate charters, or at least being debarred from doing business with federal agencies. This would be the functional equivalent of denaturalization.

Of course, the Trump Administration is not proposing anything like that for the corporate healthcare fraudsters. They are let off with what amounts to a slap on the wrist, while the Somalis are considered to deserve the harshest possible punishment. So much for equal justice.

Turning Regulators into the Anti-DEI Police

During the first year of Trump 2.0, most federal regulatory agencies have experienced savage budget cuts, deep staffing reductions, and abandonment of their core mission. The Consumer Financial Protection Bureau, teetering on the edge of extinction, was subjected to the indignity of having its investigators ordered to abide by a “humility pledge” requiring them to take a less aggressive stance toward corporate miscreants.

One of the few exceptions to this disempowerment has been seen at the portion of the Justice Department charged with enforcing the False Claims Act, the federal law most commonly used in prosecuting fraud by government contractors. While the volume of enforcement activity at most federal agencies has plummeted,  there has been a steady stream of announcements of resolved FCA cases. As shown in Violation Tracker, the DOJ has imposed $1.8 billion in penalties since Inauguration Day in about 200 actions, many involving fraud by healthcare providers.

Now, however, it appears that DOJ is moving in a different direction. There have been recent press reports saying that Justice is beginning to apply the FCA in an unusual and troubling manner.

Investigations are said to be underway in which major contractors which adopted diversity initiatives in their hiring and promotion are considered to have cheated the federal government. This is based on Trump’s dubious claim that DEI is illegal and his obsession with stamping out all remnants of it in both the public and the private sectors.

The Wall Street Journal reported that Google and Verizon are among the companies that have received DOJ demands for documents and information about their workplace programs. Other targeted companies were said to be industries ranging from automotive and pharmaceuticals to defense and utilities.

The Journal pointed out that false-claims investigations are usually begun when a whistleblower alerts the DOJ to contractor fraud. By contrast, these new anti-DEI probes are being initiated by political appointees—in other words, MAGA apparatchiks.

DOJ is not the only federal agency warping its mission to satisfy anti-DEI objectives. The Washington Post is reporting that the Equal Employment Opportunity Commission, which has a proud history of combatting employer discrimination against women and people of color, is now soliciting complaints from white men who believe they are the victims of unfair treatment related to diversity initiatives.

This comes as the agency has drastically cut back the number of conventional lawsuits involving allegations of discrimination based on race and national origin.

Earlier, the Federal Communications Commission used its power over media mergers to pressure companies to abandon their DEI policies. Companies such as T-Mobile quickly complied.

What is next? Will the Department of Agriculture prosecute farmers for employing crop diversification on their land?

It is bad enough when the Trump Administration adheres to the usual Republican playbook of deregulation and feeble enforcement. It is worse when agencies act aggressively but do so in a way that betrays their mission. The conversion of regulatory agencies into the anti-DEI police undermines their legitimate enforcement role while stoking feelings of white victimhood that are so corrosive to our society.