DOJ Fraud Division Issues Corporate Enforcement Directive

On October 1, 2026, the U.S. Department of Justice’s (DOJ) National Fraud Enforcement Division issued Directive 26-12: Corporate Enforcement in the Fight Against Fraud. Assistant Attorney General Colin M. McDonald’s October directive follows his August 2026 memorandum setting the Division’s enforcement priorities. The directive signals — in the DOJ’s words — “an aggressive, all-tools” enforcement posture across the Division’s health care, government contracting, tax, and trade fraud priorities, while simultaneously supporting the incentives designed to promote transparency, reward cooperation, and encourage voluntary disclosure of misconduct. 

Beyond reinforcing the Division’s priorities, this October directive outlines the factors the Division will give “great weight” to when making corporate charging and plea decisions. Companies operating in the areas of health care, government contracts, and international trade should take particular note. 

What You Should Know 

Corporate Enforcement 

The directive reaffirms the DOJ’s view that corporate prosecutions are warranted where wrongdoing is serious and pervasive and where a company’s compliance policies, internal controls, and history of misconduct establish that the company “caused or encouraged the offense.” But the directive also recognizes the DOJ’s desire to reward companies that demonstrate a willingness to disclose, cooperate, and remediate. Prosecutors are directed to zealously pursue bad corporate actors while guarding against overbroad enforcement that could interfere with legitimate business operations. 

The directive formally activates the newly-created Corporate Enforcement Section, which will work to ensure consistency and fairness across the Division’s corporate enforcement efforts, and will actively support other sections by counseling, litigating, and negotiating matters. Within seven days of the directive’s issuance, all Fraud Division prosecutors must report any ongoing corporate investigations to the chief of the Corporate Enforcement Section, with mandatory notification of new investigations and major developments going forward. The Corporate Enforcement Section will also take primary responsibility for evaluating compliance with corporate criminal resolutions, including oversight of compliance program implementation and disclosure obligations. 

Enforcement Priorities and Charging Factors  

Building on and reinforcing the enforcement priorities set in the August memorandum, the October directive prioritizes: (1) fraud schemes involving the health care industry; (2) fraud schemes implicating the public trust related to procurement, government contracts, and other government functions; (3) significant tax evasion; and (4) tariff evasion, importation offenses, and forced labor.  

When recommending outcomes in corporate matters, including whether to bring charges and how to structure a plea or other agreements, prosecutors must now place “great weight” on the following 10 factors:  

1. Knowledge of or involvement in the fraud scheme by corporate management; 
2. Efforts to conceal fraud from government agencies or auditors or otherwise impede or obstruct a government function or oversight; 
3. Conduct that furthers the scheme lasting three years or more; 
4. Actions that threaten the safety or security of Americans, including military readiness; 
5. Conduct that causes substantial financial hardship to a taxpayer funded program or government function; 
6. Conduct that affects multiple taxpayer funded programs or government functions; 
7. Conduct that affects three federal districts or more; 
8. Conduct that results in financial harm to twenty-five or more victims or $25 million or more in loss; 
9. Conduct that involves the exfiltration of American dollars to support foreign adversaries; and 
10. Conduct that involves immigration offenses. 

While this is a non-exhaustive list of considerations for prosecutors, given the DOJ’s emphasis on these factors, conduct that features more factors will likely be treated as more serious, while conduct with fewer of these factors or none will likely weigh in favor of a more favorable resolution for the company. 

Moreover, while several of these factors are new formulations of what has been published in prior DOJ guidance, at least partially or thematically, some of these factors do not appear in prior guidance. Most notably, the new factors to which prosecutors must now give greater weight include conduct that continues the scheme for more than three years, the effect on multiple taxpayer-funded programs or government functions, and whether the scheme impacted three federal districts or more. Most of those factors particularly implicate the health care, government contracting, and international trade fields. 

Promoting Disclosure 

The directive also seeks to promote the disclosure of misconduct. In doing so, it expressly instructs Division leadership to design and implement policies and programs that incentivize whistleblowers, including individuals who participated in the conduct, to bring forward credible information pertaining to fraud. 

Key Takeaways 

• The directive comes six months after DOJ established its new National Fraud Enforcement Division, signaling that corporate enforcement will continue to be an evolving landscape.  
• The 10 factors to which prosecutors must give “great weight” provide a concrete roadmap for assessing the severity of potential exposure and should inform internal investigations and self-reporting decisions. 
• The focus on whistleblower incentives heightens the risk that internal issues will surface through government channels before a company has an opportunity to investigate and self-report, making proactive compliance and disclosure strategies more important than ever. 
• For companies with material operations in health care, government contracting, or trade, board directors and senior leadership should consider requesting substantive periodic updates on compliance in these high-priority areas.