DOJ Identifies New Corporate Fraud Charging Factors: What Companies Need To Know

On October 1, 2026, Assistant Attorney General Colin M. McDonald issued a new memorandum, providing prosecutors in the newly created National Fraud Enforcement Division (Fraud Division) with more detailed guidance for evaluating corporate fraud matters. The memorandum directs prosecutors to place “great weight” on a new, non-exhaustive list of factors when deciding whether to bring charges against a company or negotiate a corporate resolution.

This guidance follows McDonald’s August memorandum identifying the Fraud Division’s five principal enforcement priorities, which we discussed in our prior advisory, “DOJ’s National Fraud Enforcement Division Announces Five Priority Areas — What Companies Need to Know.”

While the August memorandum identified where the Fraud Division intends to focus its resources, the new guidance provides greater insight into how prosecutors will evaluate individual corporate matters. It also calls for closer coordination with the Fraud Division’s Corporate Enforcement Section and reinforces DOJ’s increased reliance on data analytics and whistleblowers to identify potential misconduct.

Factors That Will Receive “Great Weight”

The memorandum instructs Fraud Division prosecutors to consider several factors when determining whether to charge a company or negotiate a resolution. Those considerations include:

• Management knowledge or involvement: Whether members of corporate management knew of or participated in the alleged misconduct.
• Concealment: Whether the company or its personnel took steps to hide the conduct from the government or auditors.
• Duration: Whether the alleged scheme continued for three years or longer.
• Geographic scope: Whether the conduct affected three or more federal judicial districts.
• Government programs: Whether the conduct affected taxpayer-funded programs or otherwise involved fraud against the government.
• Number of victims and financial loss: Whether the alleged scheme harmed 25 or more victims or resulted in losses of $25 million or more.
• National security and foreign adversaries: Whether the conduct threatened national security or involved the movement of U.S. dollars to support foreign adversaries.
• Immigration offenses: Whether the alleged corporate misconduct involved violations of federal immigration laws.

Although prosecutors must give these considerations significant weight, the memorandum makes clear that the list is not exhaustive. Prosecutors may consider other relevant factors consistent with the Justice Manual and assign those factors appropriate weight based on the circumstances of the particular matter.

The inclusion of management involvement as a leading consideration is especially important. Companies that identify potential misconduct should determine promptly what senior personnel knew about the alleged misconduct, when they learned it, and how they responded. Evidence that management participated in, tolerated, or attempted to conceal misconduct may substantially affect DOJ’s charging and resolution decisions.

Greater Centralization Through the Corporate Enforcement Section

The memorandum also directs Fraud Division prosecutors to work more closely with the Fraud Division’s Corporate Enforcement Section. Fraud Division prosecutors must report new and ongoing corporate fraud investigations, as well as major case developments, to the Corporate Enforcement Section.

The Corporate Enforcement Section will also have primary responsibility for evaluating whether companies are complying with the terms of corporate criminal resolutions, including a company’s efforts to implement or enhance compliance programs. This centralized structure may produce greater consistency in charging and resolution decisions across matters and jurisdictions while also subjecting companies operating under existing resolutions to more coordinated oversight.

The Fraud Division has specifically directed prosecutors to prioritize corporate fraud investigations involving:

• Health care
• Financial markets
• Government contracts
• Tax evasion
• Tariff evasion

These categories largely correspond with the enforcement priorities announced in August and provide a further indication of where DOJ intends to deploy its growing corporate-enforcement resources.

Data Analytics and Whistleblowers Remain Central to DOJ’s Strategy

The new guidance also highlights DOJ’s increasing use of data analytics and the recently established National Fraud Detection Center to identify potential fraud. The Center is designed to combine information and analytical capabilities from multiple agencies and taxpayer-funded programs, allowing the government to identify patterns or irregularities that may not be apparent when data is reviewed by a single agency.

At the same time, McDonald directed Fraud Division leadership and its law-enforcement partners to develop policies that appropriately incentivize whistleblowers to provide credible information concerning fraud. The memorandum also calls for greater public transparency regarding those programs to the extent practicable.

Together, these developments increase the likelihood that DOJ may learn of potential misconduct through its own data analysis or an internal whistleblower before a company has completed its investigation. Companies should therefore ensure that their internal reporting, data-monitoring, and escalation procedures allow legal and compliance personnel to identify and assess potential misconduct quickly.

The Corporate Enforcement Policy Still Matters

The new memorandum does not replace DOJ’s Department-wide Corporate Enforcement and Voluntary Self-Disclosure Policy. Companies may still receive substantial benefits when they voluntarily self-disclose misconduct, fully cooperate with DOJ, and timely and appropriately remediate the underlying issues.

The new charging factors may, however, become particularly important when aggravating circumstances are present or when a company does not qualify for a presumptive declination. Management involvement, concealment, the duration and geographic reach of a scheme, the number of victims, and the amount of loss could all affect how prosecutors exercise their discretion in those circumstances.

As discussed in our recent article, “Once You’ve Decided to Self-Disclose, Here’s How to Do It Right,” companies considering disclosure must be prepared to move promptly, develop the relevant facts, preserve supporting information, identify responsible individuals, and undertake meaningful remediation. The Voluntary Self-Disclosure Policy puts companies on the clock and requires self-reporting “as reasonably practicable but no later than 120 days after receiving the whistleblower’s internal report.” Waiting too long then may narrow the company’s options, particularly when DOJ is using data analytics and whistleblower information to develop investigations independently. 

What Companies Should Do Now

In light of the new guidance, companies should consider whether their compliance and investigation procedures allow them to assess the factors DOJ has identified before an enforcement issue escalates. In particular, companies should:

• Escalate promptly: Establish procedures for elevating allegations involving senior management, government programs, substantial losses, or widespread conduct.
• Address key factors: Ensure that internal investigations cover management knowledge, possible concealment, the duration of the conduct, and its geographic reach.
• Quantify exposure: Develop a reliable process for identifying the number of potential victims and reasonably estimating financial loss.
• Assess broader implications: Evaluate whether potential misconduct implicates taxpayer-funded programs, national security, immigration laws, or transactions involving foreign adversaries.
• Use data analytics: Identify anomalies or patterns that government investigators may also detect.
• Escalate whistleblower complaints: Confirm that complaints are investigated and documented appropriately.
• Preserve self-disclosure options: Conduct an appropriately scoped investigation without unnecessary delay to preserve the ability to make an informed self-disclosure decision.
• Review existing resolutions: For companies operating under corporate resolutions, assess compliance and reporting obligations in anticipation of more centralized oversight by the Corporate Enforcement Section.

The October memorandum provides companies with a more specific roadmap for understanding how the Fraud Division intends to evaluate corporate cases. It also underscores the importance of early detection and prompt escalation. Companies that understand how the newly identified factors apply to potential misconduct will be better positioned to investigate effectively, evaluate their disclosure options, and engage with DOJ if an enforcement matter arises.