False Claims Act Enforcement in 2026 to Focus on DEI, AI Fraud

The enforcement landscape entering 2026 points to sustained False Claims Act activity across traditional health care fraud, AI-enabled misconduct, civil rights–based claims, customs and tariff fraud, and expanding theories of investor liability.

The US Department of Justice’s institutional investments also point to faster case development and more targeted priorities.

Recipients of federal funds, including health-care companies, importers, and private equity owners should expect stepped-up scrutiny, broader theories of liability, and a more integrated government toolkit that includes cross-agency coordination.

‘Traditional’ Health Fraud

The DOJ–Health and Human Services FCA Working Group launched in July formalized shared investigative strategies and prioritization. The collaboration reinforces DOJ Criminal Division statements that waste, fraud, and abuse—especially within federal health care programs—remain top-tier priorities.

Kickback risks tied to products or services reimbursed by federal programs and price-reporting misconduct are squarely in focus.

What will be different in 2026 is velocity and posture. The Working Group is designed to streamline referrals, align civil and criminal remedies, and channel whistleblowers toward priority theories, while positioning the government to initiate matters absent relators where constitutional challenges to qui tam remain in play.

For providers, manufacturers, and distributors, that means greater odds of government-originated inquiries, earlier data-driven issue spotting, and enhanced coordination across agencies. Health care providers, manufacturers, and distributors should:

• Refresh risk assessments and tighten controls on arrangements tied to federal reimbursement, especially referral relationships, patient support programs, discounts and pricing, hub services, and data- or outcomes-based contracts.
• Stand up analytics aligned to DOJ/HHS priorities, such as outlier utilization, coding/billing anomalies, copay assistance, price-reporting variances.
• Recalibrate training and documentation involving medical necessity and fair-market value.

Health Care AI

Artificial intelligence is reshaping clinical documentation, coding, and claims workflows—and with it, fraud risk. The Working Group has flagged AI-driven electronic health records, or EHRs, manipulation as a top enforcement priority.

Expect 2026 to bring more scrutiny of generative and predictive tools embedded in EHRs where automated prompts, defaults, or nudges could drive claims submissions for medically unnecessary services or services never provided.

Recent enforcement touchpoints illustrate the playbook. In 2025, we saw EHR systems influencing prescribing behavior and investigations probing whether generative technologies facilitated Anti-Kickback Statute and FCA violations. On the payer side, criminal resolutions tied to AI-enabled Medicare Advantage enrollment practices confirm that targets include both provider- and plan-side conduct.

Meanwhile, the government is scaling AI as an enforcement weapon. The 2025 National Health Care Fraud Takedown, which uncovered over $14.6 billion in fraud, provides a glimpse of what is to come from initiatives like DOJ’s Health Care Fraud Data Fusion Center.

Health care organizations should test and document AI use around EHR prompts and map algorithm provenance. Demonstrated explainability, guardrails against inflated uses, and monitoring aligned to DOJ/HHS priorities will better position organizations to respond to inquiries.

DEI Fraud

The DOJ’s Civil Rights Fraud Initiative reframes compliance as a fraud-and-abuse exposure pathway wherever federal funds are in play.

Paired with DOJ’s July guidance for recipients of federal funding that catalogs unlawful discriminatory practices, such as granting preferential treatment on protected characteristics, the initiative operationalizes Executive Order 14173’s mandate to end unlawful discrimination and restore merit-based processes.

Early resolutions with public universities demonstrate the deterrent effect of the initiative and the government’s ability to secure corrective action and monetary payment without litigating FCA claims.

The 2026 risk is broader: As the initiative matures and political priorities evolve, expect the DOJ to use civil investigative demands, or CIDs, and, where needed, file FCA complaints against federal fund recipients who resist the Trump administration’s rollback of diversity, equity, and inclusion policies.

Institutions receiving federal funds or operating in federally reimbursed markets—higher education, health systems, research entities, and state or local programs—should review their FCA risk assessments with an eye towards their DEI initiatives and refresh their policies and training against DOJ guidance.

Customs, Tariff Fraud

Tariff headwinds and evolving trade rules are fueling an FCA surge targeting customs underpayments.

DOJ’s intervention in a complaint against an apparel importer—alleging dual-invoice undervaluation schemes—sits alongside several multi-million-dollar settlements for evasion, falsified invoicing, and origin misstatements. Critically, the US Court of Appeals for the Ninth Circuit’s Island Industries v. Sigma decision affirmed that FCA liability can coexist with 19 U.S.C. § 1592, greenlighting FCA as an alternative recovery path for duty evasion.

The cross-agency Trade Fraud Task Force and CBP’s increasing use of AI to detect illicit transshipment further expand the government’s toolkit. Expect more matters probing valuation, tariff classification, country-of-origin misstatements, and supply-chain representations—especially where corporate structures and third-party suppliers complicate traceability.

Importers should focus more on diligence and compliance efforts, especially where supply chains touch higher-risk transshipment hubs. Like CBP, importers should consider leveraging advanced screening and supply chain mapping solutions to further support origin determinations, monitor supplier routings, and document compliance measures.

Investor Liability

The government’s 2025 emphasis on holding investors and sponsors accountable for portfolio company FCA violations is likely to broaden in 2026, particularly in the health care space where private equity owners influence operations and compliance spend. Theories range from causing false claims to be submitted to derivative retaliation exposure in qui tam cases.

Although private equity owners have defended certain retaliation claims successfully, the overall risk trend points toward closer scrutiny of governance levers, board oversight, acquisition diligence, and post-close integration practices that affect billing and regulatory compliance.

Private equity owners should document proactive oversight by:

• Tightening pre‑close and confirmatory diligence on billing/coding
• Standing up an independent compliance function with direct board access
• Set post‑close testing and remediation milestones
• Using board dashboards with deep‑dives and clear escalation/recusal protocols
• Running targeted audits, training, and strong whistleblower protections

Rigorous, contemporaneous records will help show you neither caused nor ignored violations and didn’t undermine compliance independence.

This article does not necessarily reflect the opinion of Bloomberg Industry Group, Inc., the publisher of Bloomberg Law, Bloomberg Tax, and Bloomberg Government, or its owners.

Author Information

D. Jacques Smith is a partner and investigations practice leader at ArentFox Schiff.

Nadia A. Patel is a partner at ArentFox Schiff and co-leads its health care industry group.

Associate Meghan F. Hart contributed to this article.

Write for Us: Author Guidelines