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On Thursday, January 8, 2026, the Trump administration unveiled the creation of a new division within the Department of Justice (DOJ) to combat fraud on the federal government. In a White House press release, the administration announced that the National Fraud Enforcement Division will use "Federal criminal and civil laws against fraud targeting Federal government programs, Federally funded benefits, businesses, nonprofits, and private citizens nationwide." The move marks the latest in a series of DOJ efforts to make fraud curtailment a top priority and signals that the Trump administration is doubling down on its commitment to national program fraud enforcement.
The National Fraud Enforcement Division's Focus and Structure
The White House promises that the division will focus, initially, on stemming high-profile fraud schemes that abuse federal spending programs. But its reach could soon extend beyond that. The new fraud division looks to centralize DOJ resources and coordinate the Trump administration's interagency approach to fraud enforcement under the direction of a Senate-confirmed Assistant Attorney General.
During a White House Press Briefing on January 8, 2026, Vice President J.D. Vance explained that DOJ's new division initially will focus on alleged fraud in Minnesota. A White House press release reported that DOJ "is surging prosecution resources" to that state, doubling the number of attorneys working on related cases there. Other agencies involved in the administration's response include the Department of Homeland Security (DHS), the Department of Health and Human Services (HHS), the Small Business Administration (SBA), the Department of Housing and Urban Development (HUD), the Department of Labor (DOL), the Department of Agriculture (USDA), and the Department of the Treasury. In the White House Press Briefing, Vice President Vance anticipated that DOJ's new National Fraud Enforcement Division would eventually turn its attention from Minnesota to Ohio and California. He also predicted that the division would remain in place for the remainder of the Trump administration.
The administration appears to have strong legal support for the creation of this new DOJ division under the leadership of a Senate-confirmed Assistant Attorney General. In contrast, for example, appointing a special counsel to address alleged fraud in particular states or programs may be subject to substantial legal challenges. Under federal law that requires the President to appoint eleven Assistant Attorneys General to serve the Attorney General, the nominee set to head the National Fraud Enforcement Division would fill a slot cleared by the administration's dissolution of DOJ's Tax Division and the departure of its Acting Assistant Attorney General, Karen Kelly.
The new division will have responsibilities that overlap with those of the Fraud sections of DOJ's Civil and Criminal Divisions, which lead many government fraud enforcement actions. At this point, we do not know if those existing DOJ fraud sections will remain in the Criminal and Civil Divisions or be moved to the National Fraud Enforcement Division. In either event, we expect the Assistant Attorney General will have a major role within DOJ and with other federal agencies leading and coordinating fraud-fighting efforts.
Vice President Vance also explained that the Assistant Attorney General would "run" the division "out of the White House" under his and President Donald Trump's supervision. The White House's oversight may facilitate what the Vice President described as "a very broad interagency" effort. To that end, the Assistant Attorney General for the National Fraud Enforcement Division will:
- Oversee multi-district, multi-agency fraud investigations;
- Advise, assist, and direct United States Attorney's Offices on fraud-related issues; and
- Identify, disrupt, and dismantle organized, sophisticated fraud schemes across jurisdictions, alongside federal agencies and DOJ components.
Although the Trump administration's immediate concern is linked to high-profile fraud allegations in particular states, we expect the National Fraud Enforcement Division to broaden its focus to investigations, civil litigation, and prosecutions wherever federal funds are at stake.
Doubling Down on Fraud Enforcement
The creation of a new division within DOJ aligns with the Trump administration's consistent focus on stamping out fraud and the misuse of federal funding. The National Fraud Enforcement Division provides an opportunity for the administration to marshal resources toward the execution of its many anti-fraud goals throughout disparate industries. Leveraging DOJ resources and powerful fraud statutes like the False Claims Act (FCA), the new division will augment several projects previously announced by the administration.
In May 2025, DOJ issuedguidance detailing the Criminal Division's enforcement priorities and policies in the prosecution of corporate and white-collar crime. That memorandum outlined ten "high impact" priorities for white-collar investigation and prosecution, the first four of which related to fraud. It further stated that prosecutors should consider declination and fine reductions for companies that self-disclose and cooperate with DOJ investigations. Companies that identify risk of criminal fraud liability should consider those strategies in light of the increasing federal government focus on prosecuting fraud.
Also in May 2025, Deputy Attorney General Todd Blanche issued a memorandum regarding the creation of the Civil Rights Fraud Initiative, linking possible FCA liability to violations of civil rights laws. And in July 2025, DOJ issuedfurther guidance regarding the circumstances in which employers' diversity, equity, and inclusion efforts could run afoul of those laws. Buttressed by the Supreme Court's recent decision in Ames v. Ohio Department of Youth Services, in which the Court explained that "Title VII's disparate-treatment provision draws no distinctions between majority-group plaintiffs and minority-group plaintiffs," the National Fraud Enforcement Division may test DOJ's novel Civil Rights Fraud theory on federal contractors or other companies receiving federal funds, should they grant preferential treatment based on protected characteristics.
In July 2025, the Trump administration announcedthe formation of the DOJ-HHS False Claims Act Working Group (the Working Group). As part of the administration's healthcare fraud enforcement efforts, the Working Group was established to formalize DOJ-HHS coordination and prioritize FCA enforcement in designated priority areas. The Working Group may serve as a template for other cross-agency collaboration efforts led by the National Fraud Enforcement Division.
In August 2025, DOJ announcedthe formation of a Trade Fraud Task Force (the Task Force), which brought together the Civil Division's Civil Fraud and National Courts Sections and DHS. The Task Force was established to enforce tariffs through the initiation of FCA actions and prosecutions for trade fraud and conspiracy. The National Fraud Enforcement Division may assist or direct the Task Force in pursuit of the administration's goal of enforcing tariffs and trade law.
In addition to steps already taken by DOJ, the National Fraud Enforcement Division could allow the Department to link arms with other agencies in their anti-fraud efforts. On January 9, 2026, Secretary of the Treasury Scott Bessent announced several measures that the Department of the Treasury has taken to address alleged fraud in Minnesota: the investigation by the federal Financial Crimes Enforcement Network (FinCEN) of money services businesses; the formation of an IRS civil enforcement task force to investigate fraud involving pandemic-era tax incentives and misuse of 501(c)(3) status; and lowering banks' reporting requirements for fund transfers to $3,000 where the beneficiary is located outside of the United States. And in May 2025, the Consumer Financial Protection Bureau (CFPB) announcedthat it would be prioritizing oversight over depository institutions to root out fraud against consumers, in lieu of its prior focus on Small Business Lending and Buy Now, Pay Later loans. DOJ's new fraud division could partner with those agencies to expand their anti-fraud efforts.
Looking Ahead
We expect the National Fraud Enforcement Division to aid the administration in, and augment, its efforts to investigate and prosecute federal program fraud. The new division has at its disposal a range of effective criminal and civil enforcement tools tested throughout DOJ's anti-fraud components. These include rewards for whistleblowers, leniency for self-disclosers, and interagency collaboration. Furthermore, companies within industries that have historically faced scrutiny from the anti-fraud measures of individual agencies may soon see those agencies in partnership with DOJ.
Goodwin's Government Investigations, Enforcement & White Collar Defenselawyers will continue to monitor enforcement developments and their potential impact. Please contact the Goodwin team with any questions related to the National Fraud Enforcement Division and its enforcement objectives.
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