DOJ Fraud Division Prioritizes Tax Enforcement
An August 13 memo from the Department of Justice's reconstituted National Fraud Enforcement Division signals a new focus on tax-related crimes affecting companies across all industries.
The U.S. Department of Justice's Fraud Division has signaled a significant shift in its enforcement strategy, placing a heightened emphasis on tax-related offenses. An August 13 memorandum announced the priorities for the newly reconstituted National Fraud Enforcement Division, making clear that tax crimes are a central focus. Sophisticated counsel should advise clients that this is not a niche concern for the financial industry; the memo indicates that scrutiny will apply to companies across all sectors. This development increases the risk profile for corporate tax positions and reporting methodologies. In-house legal, finance, and tax departments should anticipate more aggressive federal investigations and prosecutions in this area. Prudent companies may wish to review their existing tax compliance programs and ensure their reporting structures can withstand increased government scrutiny. The key development to watch is how the DOJ begins to implement this policy through new investigations and charging decisions.