Key Takeaways
- The Trump Administration's priorities for civil and criminal enforcement of national security laws are evolving, and recent guidance from enforcement authorities offers important insights.
- While the Administration's enforcement priorities include familiar areas, such as export controls and sanctions, they also reflect a sharpened focus on tariff evasion and other forms of trade and customs fraud, corporate support for foreign terrorist organizations, and a new twist on anti-corruption enforcement.
- Notwithstanding the mix of old and new priorities, the Administration is positioning itself for a strategic reset, signaling a shift toward more focused and efficient enforcement. While this approach could have meaningful implications, the proof will remain in how these priorities are applied.
- Against this backdrop, the investment community should remain vigilant with respect to evaluating and managing portfolio company risks. With investigations often spanning multiple administrations, shifting enforcement posture should be seen as tactical, not structural. Some trends reinforce priorities set under the Biden Administration and are likely to outlast the current administration; other trends reflect a change but might not be continued.
- In this OnPoint, we highlight what's happening and what you
should consider in seven key enforcement areas.
1. Export Controls & Sanctions: Stepping Up Enforcement
BIS officials have emphasized in recent public remarks their intent to significantly scale up enforcement. U.S. Commerce Secretary Howard Lutnick previewed a "dramatic increase" in enforcement and fines, particularly in sectors like quantum computing, artificial intelligence ("AI"), hypersonics, and semiconductors as well as military and intelligence end uses and users. BIS is also seeking a substantial FY26 budget increase—reflected in the President's May 2 request, which proposes a more than 50 percent increase in BIS funding—to expand the Office of Export Enforcement ("OEE"), potentially doubling its overseas agents.
The sanctions enforcement landscape is similarly intensifying. The Office of Foreign Assets Control ("OFAC") of the U.S. Department of the Treasury has signaled a more aggressive posture, marked by a steady stream of new designations targeting Russia, Iran, and transnational criminal networks (while also acting to remove sanctions against Syria). Recent actions include sanctions on Iran's shadow banking system and narcotics traffickers in South America. OFAC has also acted in politically charged contexts, such as sanctioning International Criminal Court judges, while issuing general licenses to manage fallout. The overall approach reflects a sustained push to elevate sanctions as a central tool of U.S. foreign policy.
On the enforcement front, OFAC recently imposed a statutory-maximum approx. $216 million penalty on U.S.-based GVA Capital ("GVA") in connection with allegations that the venture capital firm managed investments on behalf of Russian oligarch Suleiman Kerimov that should have been blocked. According to OFAC, GVA knowingly facilitated Kerimov's interests even after his 2018 designation and later failed to fully cooperate with OFAC in response to a subpoena. OFAC emphasized that this enforcement action underscores the critical role of financial "gatekeepers," such as investment advisers and fund managers, in preventing sanctions evasion. The case serves as a clear warning that formalistic ownership structures will not shield firms from liability where actual knowledge and control are evident.
The DOJ's National Security Division also announced a recent declination and non-prosecution agreements ("NPAs") involving Unicat Catalyst Technologies LLC ("Unicat") and White Deer Management LLC ("White Deer"). After acquiring Unicat, White Deer uncovered export violations and promptly disclosed them (not only to BIS but also to DOJ), resulting in a rare declination for the acquirer and a NPA for the acquired entity. While the parties received a declination from criminal prosecution, Unicat entered into a global civil settlement in June 2025 with BIS and OFAC of approx. $3.9 million, which accounted for a civil forfeiture to DOJ and civil penalties to OFAC and BIS. Where possible, investors and acquirers should insist on meaningful transaction-related due diligence so that potential exposure can be identified pre-signing and the allocation of risk can be worked into the transaction arrangements. When this is not possible (or successful), this settlement highlights the importance of conducting thorough inquiries and then acting on findings quickly on a post-close basis.
Notwithstanding the Administration's rhetoric of change around enforcement, these examples signal continuity with Biden-era enforcement on export controls and sanctions topics. The Unicat/White Deer declination, for example, followed the Enforcement Policy established in March 2024 by the National Security Division ("NSD") of the Department of Justice related to voluntary disclosures following acquisitions. Similarly, the civil settlements in Unicat and GVA also conclude cases that likely were initiated under the Biden Administration, even if they were settled in recent weeks.
2. Mixed Signals on Anti-Corruption Enforcement
President Trump colorfully referred to the Foreign Corrupt Practices Act ("FCPA") as a "garbage law" because, in his perspective, it makes the playing field unlevel for American companies, and in February 2025 issued an Executive Order pausing new FCPA cases.
During the four-month "pause" on corporate FCPA enforcement following the February 2025 Executive Order, DOJ continued to resolve existing matters and refine policy. Several investigations were closed based on cooperation and remediation, and no new corporate actions were filed. In the end, however, the period served more as a recalibration than a retreat.
DOJ has since issued updated FCPA guidelines that signal continued enforcement, albeit with a revised focus. The June 2025 Memo outlines several factors guiding enforcement including:
- Connection to cartels or Transnational Criminal Organizations ("TCOs");
- Harm to U.S. businesses;
- Threats to U.S. national security; and
- Serious individual misconduct (not de minimis gifts or hospitality).
The guidance prioritizes national interest and fairness over rote enforcement. The new posture differs more in style than in substance from that of the prior administration. The updated guidelines maintain anti-corruption enforcement as a top ten white-collar priority, while refining DOJ's lens. The continued emphasis on money laundering also echoes Biden's 2021 strategy that elevated corruption and illicit finance as a national security concern.
Companies should avoid making abrupt changes to their compliance posture in response to the evolving policy environment. FCPA enforcement actions typically take years to develop, the United States is no longer the only government that actively enforces anti-corruption laws, and a future U.S. administration could return to a broader enforcement approach. Although the updated guidelines reflect a more targeted framework, enforcement remains active and is likely to be opportunistic, particularly in cases implicating U.S. national security or competitive harm to American companies. Non-U.S. companies, especially those operating in strategic sectors or competing against U.S. firms, may face elevated risk under the current enforcement lens. Maintaining a steady, risk-based compliance program remains prudent.
3. Tariffs are a Priority Area for Enforcement
Tariff evasion and customs fraud are now squarely in enforcement crosshairs. DOJ as well as U.S. Customs and Border Protection ("CBP") and Homeland Security Investigations ("HSI") have prioritized schemes involving false origin declarations, undervaluation, and evasion of Section 301/232 tariffs. DOJ has highlighted these violations as distorting trade and harming U.S. industries. These enforcement trends are further reinforced by DOJ's May 2025 Memo, which explicitly identified trade and customs fraud as national security enforcement priorities.
OFAC's enforcement against Unicat also included a $1.66 million penalty for undervaluing imports from China to avoid duties, illustrating the government's willingness to bundle tariff and export/sanctions violations.
Supply chain misstatements can now trigger multi-agency probes. Clients should review country-of-origin assessments, transshipment risks, and tariff classification practices. Compliance with trade documentation requirements is increasingly being viewed through a national security lens.
4. Anti-Money Laundering Enforcement Priorities Clarified
DOJ is intensifying focus on illicit finance channels linked to foreign adversaries and corporate abuse of Variable Interest Entity ("VIE") and Special Purpose Vehicle ("SPV") structures. The GVA Capital matter exemplifies this: OFAC viewed GVA's dealing with a designated Russian oligarch, through layered structures and proxies, as willful facilitation of sanctions evasion.
Financial Crimes Enforcement Network ("FinCEN"), meanwhile, has finalized rules requiring certain investment advisers to implement Anti-Money Laundering/Combating the Financing of Terrorism ("AML/CFT") programs and begin Suspicious Activity Report ("SAR") filings starting January 1, 2026. However, the scope of covered entities remains somewhat unsettled, with lingering ambiguity around which types of "financial institutions" will be subject to the rule. It is also possible that implementation may be delayed, allowing for further clarification or alignment with parallel regulatory efforts. These rules reflect FinCEN's contribution to DOJ's broader anti-money laundering priorities, as laid out in its May 2025 Memo emphasizing financial transparency as critical to curbing national security threats.
Registered investment advisers should assess whether their current controls are sufficient in light of the potential expansion of AML compliance program requirements (which we discuss in greater detail here). Firms using VIEs or other complex structures in sensitive jurisdictions (e.g., China, Russia) should also evaluate illicit finance risks and consider structuring changes and/or enhanced beneficial ownership due diligence for their investment partners.
5. Corporate Enforcement: Same Carrots, Sharper Branding
DOJ is continuing to promote self-disclosure and cooperation, but with a stronger message around whistleblowers. Tips involving sanctions, trade, and terrorism financing now fall squarely within the scope of DOJ's whistleblower pilot program.
The Unicat/White Deer resolutions also reaffirm DOJ's "carrot" strategy: rapid internal action led to a declination for White Deer, while Unicat's cooperation and remediation yielded a favorable resolution despite criminal conduct.
The incentives remain: self-disclose early, cooperate thoroughly, and remediate quickly. But DOJ is also working to make these incentives more predictable and tied to concrete benefits (e.g., declinations, NPAs, reduced penalties). Clients should also assess whistleblower intake procedures and culture, ensuring alignment with DOJ's priorities.
6. CFIUS: Policy Shift Without Clarity on Enforcement
The Trump Administration's America First Investment Policy ("AFIP") is expected to have a meaningful impact on the CFIUS process generally and on enforcement in particular. Our prior coverage of AFIP and the Administration's plan for an open investment environment is available here. At a high level, the Administration may make less frequent use of National Security Agreements ("NSAs") in certain types of deals; when mitigation is used, CFIUS will work to reduce reliance on open-ended mitigation; and the Administration also has signaled an intent to streamline reviews for allied and partner countries through a "fast-track" process.
At the same time, CFIUS will likely be viewed as opportunistic under the Trump Administration, as demonstrated by its reversal on the Nippon Steel-U.S. Steel transaction. That deal was initially blocked by the Biden administration on national security grounds, only to be revived under a new review ordered by President Trump, resulting in an unprecedented NSA. The agreement included not only a multi-billion-dollar investment commitment but also the issuance of a "Golden Share" to the U.S. government, granting it veto rights over strategic decisions such as redomiciling, divestitures, or major capital expenditures. This marked a significant departure from past mitigation practices, and the turnabout reflects how political dynamics can drive outcomes in high-profile cases. The eventual clearance underscores that, while AFIP promises a streamlined and more predictable process for allies, CFIUS remains subject to broader political pressures and open to novel, bespoke remedies in select cases.
To date, only ten transactions have ever been formally blocked by Presidential Order. The Trump Administration's recent order (the "Order") blocking the acquisition by Suirui Group Co., Ltd. (China) and its Hong Kong affiliate of Jupiter Systems, a screen and visualization business that serves U.S. government customers, is the latest example. This transaction closed in 2020 and was not reviewed and cleared by CFIUS at that time. The Order serves as a powerful reminder that transactions that are not brought before the Committee can be reviewed by the Committee at any time, including many years post-close, and that if the Committee determines there are national security risks that cannot be mitigated through a national security agreement, CFIUS and the President have broad power to block a transaction and order divestment. Parties would be wise to manage this legal and reputational tail risk by evaluating CFIUS considerations from the start.
Enforcement action is also evolving. While CFIUS has long scrutinized non-notified transactions(see Suirui example above) and compliance with NSAs, AFIP reflects a growing presumption that PRC-affiliated investment in certain sensitive sectors is effectively prohibited, particularly when structured through indirect or "concealed" channels. However, CFIUS has not publicly articulated how it will prioritize or execute enforcement—a gap that merits continued monitoring, especially as jurisdiction expands into areas like greenfield investments and real estate near sensitive sites.
7. Outbound Investment: Enforcement Looms
Treasury is also ramping up enforcement of the U.S. outbound investment security program ("OISP").1 AFIP signaled the Administration's intention to expand the OISP beyond investments in semiconductors, quantum, and AI to cover new industries (such as biotechnology, aerospace, and advanced manufacturing) and to reduce or eliminate existing exemptions for passive investments and investments in public securities, all of which would impose new compliance burdens on the U.S. investment community. The FY26 budget request includes resources to support expanded staff for the Office of Global Transactions, which administers the OISP. Early-stage inquiries have reportedly been issued to multiple U.S. firms. These outreach efforts may serve as a precursor to formal enforcement and are expected to increase as the regime matures and potentially expands to cover additional technologies. These efforts have already resulted in more caution from the investment community, including more aggressive side letters and other forms of protections from limited partners in different fund structures.
What's Next
The Trump Administration's "reset" reflects a rebranding more than retrenchment. While framed as a return to focus and efficiency, in practice it reflects an integrated, multi-agency approach with higher stakes for companies. The message across sanctions, trade, anti-corruption, and investment reviews is consistent: national security is the throughline.
Cases like GVA Capital and Unicat demonstrate that authorities are not just setting new expectations but are enforcing them. As outlined in DOJ's May 2025 Memo, national security concerns will drive prioritization across multiple white-collar areas, including sanctions, export controls, AML, FCPA, and trade fraud.
For companies, this means reexamining compliance protocols with a sharper focus on geopolitical risk. Cross-border operations, sensitive technologies, and foreign capital require heightened diligence and real-time adaptability. As always, Dechert is available to assist with risk assessments, enforcement exposure, and program enhancements tailored to today's integrated enforcement landscape.
Footnote
1 See Deputy Secretary Michael Faulkender's Remarks at a recent CFIUS conference, https://home.treasury.gov/news/press-releases/sb0101.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
