On May 19, 2025, the U.S. Department of Justice (DOJ) announced that it had formed a “Civil Rights Fraud Initiative,” co-led by DOJ’s Civil Fraud Section and Civil Rights Division. The unit will use the False Claims Act (FCA) to pursue federal contractors and fund recipients “who defraud the United States by taking its money while knowingly violating civil rights laws.”
Memorandum Directs FCA Enforcement Against DEI Discrimination and Anti-Semitism
Deputy U.S. Attorney General Todd Blanche released a brief memorandum Monday instructing DOJ attorneys to file FCA claims against recipients of federal funds engaging in specific civil rights violations, such as:
- “[A] university that accepts federal funds” while encouraging “antisemitism, refus[ing] to protect Jewish students, allow[ing] men to intrude into women’s bathrooms, or requir[ing] women to compete against men in athletic competitions”
- Federal contractors or fund recipients who “certify compliance with civil rights laws while knowingly engaging in racist preferences, mandates, policies, programs, and activities, including through diversity, equity, and inclusion (DEI) programs that assign benefits or burdens on race, ethnicity, or national origin”
The memo notes that “many corporations and schools continue to adhere to racist policies and preferences—albeit camouflaged with cosmetic changes that disguise their discriminatory nature”—despite Supreme Court precedent, Students for Fair Admissions, Inc. v. President & Fellows of Harv. Coll., 600 U.S. 181 (2023), and the principles in the January 21, 2025 Executive Order 14173 (which we previously addressed here).
To implement the initiative, DOJ’s Civil Fraud Section and Civil Right Division will work with other agencies and components—including the Criminal Division, Department of Education, Department of Health and Human Services, Department of Housing and Urban Development, Department of Labor, state attorneys general, and local law enforcement—to identify and pursue government contractors or fund recipients who knowingly violate federal civil rights laws. In a DOJ press release, Attorney General Pamela Bondi warned that “[i]nstitutions that take federal money only to allow anti-Semitism and promote divisive DEI policies are putting their access to federal funds at risk.”
False Claims Act as a Civil Rights Enforcement Mechanism
The FCA is a powerful enforcement tool that:
- Exposes defendants to treble damages and significant penalties
- Incentivizes whistleblowers to bring qui tam enforcement cases on the government’s behalf—in which the government may or may not intervene—and potentially share in any monetary recoveries
In addition to filing FCA qui tam actions, DOJ is encouraging private citizens to report “discrimination by federal-funding recipients” to federal authorities.
Anticipating Enforcement: What Stakeholders Should Do Now
The initiative is the Trump administration’s latest effort to combat perceived discrimination in DEI policies. To learn more about what constitutes potential DEI-related discrimination, please review Venable’s recent article, “Defining ‘DEI-Related Discrimination’: Recent Moves by the EEOC Shed Further Light on the Trump Administration’s DEI Focus.”
In anticipation of heightened FCA enforcement, stakeholders should consider implementing or reviewing existing internal reporting mechanisms for civil rights concerns and preparing compliance and legal teams for government inquiries and whistleblower actions. Whether you are reviewing internal protocols or facing a qui tam enforcement action, Venable’s Investigations and White Collar Defense practice stands ready to help navigate the way forward.