DOJ and HHS Relaunch False Claims Act Working Group: Implications for Financial Services Companies
On July 2, 2025, the Department of Justice announced the renewal of the DOJ-HHS False Claims Act Working Group, reinvigorating a partnership first launched during the previous Trump administration to strengthen healthcare fraud enforcement through the False Claims Act. This follows on the heels of the Trump administration’s announcement of the Civil Rights Fraud Initiative, describing plans to use the FCA to target programs and policies that support DEI, covered by Mitchell Sandler here.
Working Group Structure and Leadership
The Working Group will be jointly led by HHS's General Counsel, the Chief Counsel to the HHS Office of Inspector General, and DOJ's Deputy Assistant Attorney General of the Commercial Litigation Branch. Membership includes leadership from the Centers for Medicare and Medicaid Services Center for Program Integrity and designees from U.S. Attorneys' Offices.
Key Enforcement Priorities
The Working Group has identified several priority enforcement areas:
Medicare Advantage
Drug, device, and biologics pricing, including arrangements involving discounts, rebates, service fees, formulary placement, and price reporting
Barriers to patient access, including violations of network adequacy requirements
Kickbacks related to drugs, devices, durable medical equipment, and other products paid for by federal healthcare programs
Materially defective medical devices impacting patient safety
Manipulation of electronic health records to drive inappropriate utilization of Medicare covered products and services
Enhanced Enforcement Capabilities
The Working Group plans to expedite ongoing investigations and identify new leads by "leveraging HHS resources through enhanced data mining and assessment of HHS and HHS-OIG report findings." The partnership will also coordinate decisions on whether HHS should implement payment suspensions or whether DOJ should move to dismiss qui tam complaints.
Financial Services Implications
While primarily focused on healthcare fraud, the Working Group's priorities create potential exposure for financial services companies in several areas:
Healthcare payment processing companies may face increased scrutiny if their systems process fraudulent claims
Medical device and pharmaceutical financing providers could face liability if they facilitate fraudulent pricing schemes or kickback arrangements
Healthcare fintech companies providing billing or administrative services may be subject to False Claims Act liability if their services facilitate fraudulent billing practices
Compliance Considerations
Financial services companies with healthcare-related business lines should consider:
Strengthening customer due diligence processes for healthcare clients, particularly in the Working Group's priority areas
Ensuring transaction monitoring systems can identify potentially fraudulent healthcare transactions
Reviewing internal compliance programs and whistleblower reporting mechanisms
Assessing self-disclosure policies and procedures
The DOJ announcement encourages whistleblowers to identify and report FCA violations involving priority enforcement areas, and it encourages healthcare companies to identify and self-report such violations. As such, robust internal compliance programs are more critical than ever.
Looking Forward
The renewed DOJ-HHS partnership, combined with enhanced data mining capabilities and clearly defined priority areas, suggests healthcare fraud enforcement will likely increase in both frequency and sophistication. Mitchell Sandler PLLC has extensive experience advising financial services companies on compliance and enforcement matters, including white collar defense and corporate investigations involving healthcare fraud. For questions about how the DOJ-HHS False Claims Act Working Group may affect your business, please contact our team.
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Seth Waxman is a Partner at Mitchell Sandler. He leads the White Collar Defense and Corporate Investigations Group. He represents financial institutions, financial service providers, mortgage lenders, health care companies, public officials and all other manner of businesses and individuals facing government investigations, criminal and civil actions, and regulatory enforcement. He is a nationally recognized former federal prosecutor with 30 years’ experience.
Bree Murphy is senior counsel at Mitchell Sandler. She has two decades of experience advocating for her clients in the boardroom and the courtroom as they navigate government scrutiny, internal investigations, civil litigation, and criminal prosecution. With a deep understanding of the impact an investigation may have on individuals and businesses, Bree defends and guides her clients with an eye towards minimizing stress and disruption.
Sean Hennessy is Counsel at Mitchell Sandler. He is a seasoned litigator and former federal enforcement attorney with extensive experience representing businesses and individuals in complex civil litigation, government investigations, and regulatory enforcement actions. He has served as a Trial Attorney in the Division of Enforcement at the Commodity Futures Trading Commission (CFTC), where he led high-stakes investigations and federal court prosecutions involving insider trading, market manipulation, financial fraud, and other misconduct. While at the CFTC, Sean served on the agency’s Digital Assets Task Force and was a key advisor to leadership on emerging legal and technological developments in crypto enforcement and regulation.
Chloé Dolsenhe is Senior Associate at Mitchell Sandler. She specializes in regulatory compliance, government enforcement, and internal investigations primarily for financial technology companies, depository institutions and third-party service providers. She brings her experience as a government enforcement attorney where she leveraged AI in investigations and led the Generative AI Working Group in the Enforcement Division of the Office of the Comptroller of the Currency. She advises clients seeking compliance guidance when integrating artificial intelligence and integrating digital assets into their consumer products.