DOJ Announces Speedier Review, Stricter Enforcement of Benefits Fraud Under the False Claims Act

On May 27, 2026, Assistant Attorney General Brett A. Shumate issued a memorandum, “Accelerating Review and Enhancing Enforcement in Benefits Fraud Matters” (the Shumate memo), to all Department of Justice (DOJ) attorneys in the Commercial Litigation Branch’s Fraud Section and assistant U.S. attorneys (AUSAs) handling False Claims Act (FCA) matters. The Shumate memo sets forth a new operating framework for qui tam actions involving federally funded benefits programs administered by states. This memo is DOJ’S first comprehensive attempt to translate the March 16 executive order establishing the Task Force to Eliminate Fraud into concrete litigation expectations.

The March 16 executive order directs DOJ to promote meritorious FCA qui tam filings and to accelerate review of such filings “to the maximum extent practicable,” including within the FCA’s 60‑day seal period. Under the FCA, every qui tam complaint is filed under seal and served only on the government, giving DOJ a minimum of 60 days to investigate and decide whether to intervene before the defendant is notified.

In practice, courts have routinely granted extensions, and cases have often remained under seal for one to two years or longer while DOJ completes its review. The Shumate memo frames the initiative as a response to the rise in fraudulent schemes targeting programs that provide housing, food, medical care, and cash assistance and reiterates DOJ’s view that the FCA is a central tool for protecting federal benefits spending.

Streamlined Review: A 60/120‑Day Model

The most significant emphasis in the Shumate Memo is timing. DOJ will now prioritize completing its initial review of newly filed benefits fraud qui tam actions within the 60‑day seal period to the maximum extent practicable and must complete its review no more than 120 days after filing. This is a marked departure from the often years‑long seal periods that have historically characterized FCA practice.

At the end of the review period, DOJ must select one of the following courses of action:

• Relator‑led litigation: Allow relator to proceed, with the government retaining supervisory authority;
• Further government investigation: Determine that additional investigative steps are warranted; or
• Dismissal under § 3730(c)(2)(A): Conclude that the allegations lack specificity or are legally deficient.

The Shumate memo acknowledges that this approach will increase the number of benefits fraud cases primarily litigated by relators. Even so, DOJ expects to continue leading the majority of incoming matters. The goal is to move potentially meritorious cases more quickly while reserving government resources for the largest, most complex, and harmful schemes.

Considerations Driving DOJ’s Disposition Decision

The Shumate memo identifies several considerations when determining whether to allow a relator to proceed:

• Plausible FCA theory: Allegations that, if true, would establish an FCA violation;
• Corroboration: Factual support, such as data analytics, agency information, or relator‑supplied evidence;
• Non‑complex conduct: Schemes or misconduct that are neither novel nor operationally complex;
• Damages below $10 million: Potential damages that are within the Director of Civil Fraud’s settlement authority; and
• Aggravating factors: Aggravating factors (e.g., beneficiary harm, ongoing misuse of federal funds, or concealment).

If DOJ allows a relator to proceed, it expects relator’s counsel to bear the burden of litigating, meaning the complaint must plead fraud with particularity, and the burden and costs to the government should be minimized to the greatest extent possible. Further, the relator must ensure that the case is maintained and remains viable under DOJ’s continuing evaluation.

Expedited Investigation Protocol

For matters requiring further investigation, the Shumate memo establishes a 120‑day investigative period with detailed expectations:

• Investigative plan: Assigned attorneys must outline a schedule for the prompt issuance of Inspector General subpoenas and/or Civil Investigative Demands (CID) and early witness interviews.
• Targeted information requests: Information requests should be narrowly tailored. Early interviews and oral examinations should be considered as alternatives to broad document productions.
• Subpoenas and CID enforcement: Defendants must receive firm deadlines for responses. If a deadline is missed without justification, DOJ should initiate enforcement.
• Relator involvement: DOJ may request assistance from relator’s counsel, recognizing their potential to accelerate fact development.
• Damages refinement during discovery: If settlement is unlikely and a detailed damages analysis would delay the investigation, DOJ may make an intervention decision once liability evidence and general loss parameters are established, refining damages during discovery.

Extensions beyond the initial 120 days require escalating approval, first from the Deputy Assistant Attorney General for Commercial Litigation and then from the Assistant Attorney General for the Civil Division.

Whole‑of‑Government Coordination

The Shumate memo directs immediate coordination across enforcement components. New benefits fraud matters will be referred to the Criminal Division and/or the National Fraud Enforcement Division for criminal evaluation and will be shared with the relevant agency for potential administrative action, including payment suspension.

This structure means a single whistleblower complaint could trigger:

• Civil FCA litigation;
• Criminal investigation; and/or
• Administrative consequences, including suspension from program participation.

For entities reliant on federal benefits programs, the administrative track alone may carry significant operational risk.

Policy Implications

Under the 60/120‑day framework, many qui tam actions will be unsealed as a result of DOJ having declined to intervene rather than after conducting a full investigation. The $10 million threshold for relator‑led cases indicates that mid‑sized matters that previously may have remained under seal for extended periods may now proceed under private counsel’s direction with DOJ oversight. Recent filing trends underscore the scale of incoming qui tam actions: whistleblowers filed a record 1,297 qui tam suits in fiscal year 2025, a sharp increase from 980 filed the prior year.

The Shumate memo may also signal further adjustments ahead. DOJ has stated that it will continue to assess how it can enhance processes and procedures to support prompt resolution of benefits fraud qui tam cases, which suggests that additional operational guidance may follow. Entities participating in federally funded benefits programs should consider preparing for a more accelerated enforcement environment and shorter response timelines.

Conclusion

Taken together, the Shumate memo and executive order signal a more assertive and time‑bound approach to benefits fraud enforcement. DOJ has emphasized the need for earlier triage, faster investigative steps, and coordinated civil, criminal, and administrative review. Entities participating in federally funded benefits programs should expect shorter response windows and more targeted information requests. As DOJ continues refining its processes, regulated entities should consider reassessing internal controls, escalation pathways, and readiness to respond to FCA investigations.

Ballard Spahr’s White Collar Defense and Investigations Group regularly represents clients facing FCA investigations, qui tam litigation, and parallel criminal and civil enforcement proceedings. Our attorneys have extensive experience navigating DOJ enforcement actions involving federal benefits programs, including healthcare fraud, housing fraud, and other government-funded program matters. Please contact us if we can assist with advice and counsel or in responding to active inquiries, investigations, or enforcement proceedings.

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