DOJ Fraud Division Directive Adds Corporate Prosecution Factors
An Oct. 1 memorandum from Assistant Attorney General Colin McDonald sets the National Fraud Enforcement Division's corporate priorities and adds new charging and plea factors on top of the Justice Manual.
On Oct. 1, Assistant Attorney General Colin M. McDonald issued Directive 26-12, "Corporate Enforcement in the Fight Against Fraud," to the National Fraud Enforcement Division created in April 2026. It creates a Corporate Enforcement Section that will oversee all Division investigations and prosecutions of corporate entities and assess companies' compliance with existing corporate criminal resolutions. Prosecutors are directed to prioritize four categories: healthcare fraud (including controlled substances and FDCA violations), fraud touching the financial integrity of government contracts and procurement, tax-evasion schemes, and tariff-evasion fraud.
Beyond the Justice Manual's Principles of Federal Prosecution of Business Organizations, the memo lists considerations including management knowledge or participation, obstruction of auditors or oversight, schemes lasting three or more years, harm to 25 or more people or losses of $25 million or more, conduct spanning three or more federal districts, money sent abroad to support U.S. adversaries, and immigration-law violations. It also directs proactive lead generation and instructs Division leadership to build whistleblower programs protecting insiders who participated in wrongdoing.
Why it matters: charging decisions and resolution terms now have an additional published benchmark, complicating parallel-resolution strategy. Two caveats: the directives apply only to Fraud Division-supervised matters, not all USAO matters, and the Division is newly populated, so precedent is thin. Watch for early declinations, DPAs, or pleas applying these factors.