500 Prosecutors and Five Priorities: Inside DOJ’s Aggressive New Fraud Push

The U.S. Department of Justice (DOJ) is building what it calls “the most sophisticated, innovative, and data-driven white-collar law enforcement component in the world” — and it expects roughly 500 attorneys and staff to be in place to run it within weeks. On August 13, 2026, Assistant Attorney General (AAG) Colin M. McDonald issued a memorandum (the Memorandum) laying out the enforcement priorities and expanded structure of DOJ’s newly created National Fraud Enforcement Division (the Fraud Division), signaling a more aggressive approach to fraud enforcement that companies in high-risk industries cannot afford to ignore. We unpack this important announcement below.

Expanding the Fraud Division’s Enforcement Capabilities

The Fraud Division is substantially expanding its personnel and capabilities and is expected to reach approximately 500 attorneys and staff by August 24, 2026. AAG McDonald stated that the Fraud Division will continue to grow over the next two years under an “aggressive plan” to significantly increase the number of personnel dedicated to fighting fraud. To date, this has included shifting personnel from other DOJ components into the Fraud Division, but the Memorandum calls for an aggressive push to hire new prosecutors. DOJ also has issued a final rule, effective August 24, 2026, formally establishing the Fraud Division in 28 C.F.R. Part 0 and assigning it broad authority over criminal fraud, tax, trade, government-payment, health-plan, and healthcare matters, moving that authority from the Criminal Division.

As reflected in the organizational chart attached to the Memorandum, the Fraud Division will consist of multiple specialized litigating sections supported by asset recovery attorneys and investigators, appellate counsel, a dedicated privilege review team, corporate enforcement experts, automated litigation support, data science expertise, and other technology resources. DOJ is organizing the Fraud Division to be “lean, flat, and agile,” with career prosecutors deployed across the country to work with U.S. Attorneys’ Offices. AAG McDonald also noted how the Fraud Division has worked with state and local law enforcement partners to better share data and eliminate information silos in fraud detection and prosecution.

Key Enforcement Priorities

AAG McDonald’s Memorandum identifies the Fraud Division’s five principal enforcement priorities: public trust and financial integrity, healthcare, internal revenue, global trade and commerce, and corporate misconduct. Across these areas, the Memorandum directs personnel to focus resources principally on frauds that threaten the “health, safety, security, and prosperity of Americans,” with particular attention to schemes affecting vulnerable populations.

Public trust and financial integrity. The Fraud Division will target fraud against the government, taxpayers, the economy, and individual Americans, with particular emphasis on government procurement fraud, including defective pricing, bid rigging, self-dealing, bribery, product substitution, and billing fraud, as well as schemes targeting federal benefit and grant programs such as student loans, child care, veterans’ benefits, nutritional assistance, disaster relief, and small business programs.

Healthcare. Priorities include telemedicine fraud, Medicare and Medicaid fraud, controlled substance diversion, home health and hospice schemes, and deceptive marketing of unsafe products and services. The Fraud Division plans to expand its Health Care Fraud Strike Force model through increased use of data analysis, technology, and additional resources, focusing on significant schemes involving substantial financial losses and related offenses such as money laundering, tax violations, and other financial crimes.

Criminal Tax Enforcement. Fraudulent tax-return claims, concealed income, falsified return information, and abusive tax promotion schemes are all under scrutiny. AAG McDonald emphasized the overlap between fraud against government programs and federal tax offenses, pledging that the Fraud Division will use criminal tax tools, data analytics, financial forensics, and nationwide coordination to identify and pursue such misconduct.

Global trade and commerce. The Fraud Division will focus on systemic and high-impact trade and customs violations. Through the Trade Fraud Task Force, prosecutors will target conduct including illicit transshipment, country-of-origin fraud, undervaluation of imported goods to evade duties, sanctions evasion, and schemes involving forced labor, reflecting the Memorandum’s emphasis on fraud that implicates both economic and national security interests.

Corporate misconduct. The Fraud Division will continue pursuing its existing pipeline of corporate matters and prioritize anti-fraud corporate enforcement. At the same time, DOJ reiterated that organizations that voluntarily self-disclose misconduct, cooperate with investigations, and remediate violations may receive favorable treatment under Fraud Department policies governing corporate prosecutions.

Industry Implications

AAG McDonald’s Memorandum signals that fraud enforcement will be increasingly centralized, data-driven, and coordinated across enforcement agencies and subject areas. For companies operating in priority areas — including government contracting, healthcare, tax, international trade, and other corporate matters — a robust compliance program will be essential to navigating the scrutiny that is likely to accompany DOJ’s expanded fraud enforcement efforts. The Memorandum also offers a meaningful incentive: organizations that voluntarily self-disclose misconduct, cooperate with investigations, and remediate violations stand to receive favorable treatment. In an enforcement environment built on data and speed, getting ahead of a problem has never mattered more.

For questions about compliance or best practices in light of these developments, please contact the authors or any member of Arnold & Porter’s White Collar Defense & Investigations practice group.

© Arnold & Porter Kaye Scholer LLP 2026 All Rights Reserved. This Blog post is intended to be a general summary of the law and does not constitute legal advice. You should consult with counsel to determine applicable legal requirements in a specific fact situation.