Navigating the Current Enforcement Landscape

Key Takeaways: Navigating the Current Enforcement Landscape

Executive Summary

The webinar, hosted by Kip Randall from Husch Blackwell's White Collar Internal Investigations and Compliance group, provided an overview of government enforcement priorities, focusing on DOJ criminal enforcement, the False Claims Act (FCA), antitrust issues, and state Attorney General (AG) enforcement. Key points included the DOJ's focus on healthcare fraud, financial market protection, transnational conduct, money laundering, bribery, and digital assets. The FCA's role in addressing healthcare fraud, cybersecurity compliance, customs fraud, and PPP loan fraud was highlighted. Antitrust priorities under the new administration were discussed, emphasizing merger reviews, monopolization, and labor market competition. State AG enforcement priorities were also covered, noting their increased role in consumer protection and antitrust enforcement. The session concluded with a discussion on the DOJ's corporate whistleblower program and the importance of efficient investigations and compliance monitoring.

Speakers

Wendy Arends, Partner, Husch Blackwell, 608.258.7382, wendy.arends@huschblackwell.com
Matthew Diehr, Partner, 314.480.1916, matthew.diehr@huschblackwell.com
Kip Randall, Partner, 816.983.8224, kip.randall@huschblackwell.com
Jody L. Rudman, Office Managing Partner, 512.703.5716, jody.rudman@huschblackwell.com

Key Takeaways

1. White-Collar Enforcement Priorities: The DOJ's Galeotti memo outlines ten high-impact areas for white-collar enforcement, including healthcare fraud, financial market protection, transnational conduct, money laundering, bribery, and digital assets.

2. Historic Healthcare Fraud: The largest healthcare fraud takedown in DOJ history involved criminal charges against 324 defendants across 50 federal districts, highlighting the aggressive, data-driven approach to enforcement.

3. Whistleblower Program Incentives: The DOJ's pilot whistleblower program incentivizes companies to self-report corporate misconduct within 120 days to potentially receive a presumption of declination.

4. Non-Compete Rule Changes: The FTC has vacated its broad non-compete rule but continues to challenge specific non-compete agreements under Section 5 of the FTC Act.

5. State AGs Actions: State AGs are increasingly stepping in to fill perceived regulatory gaps left by federal agencies, with a focus on consumer protection, rural issues, and antitrust enforcement.

Key Quote

The memo identifies 10 high impact areas in the white collar space that the Department of Justice will be prioritizing. And the basis for those priorities for the memo is that these areas are seen as having the greatest impact on citizens, investors, markets, companies in the interest of the United States, like for example, economic threat, threats to public health, digital assets, national security.

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Webinar

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FAQs: Navigating the Current Enforcement Landscape

General Information

1. What is the focus of the Government Enforcement, Compliance and Investigations webinar series?
The series will cover government enforcement priorities, with deeper dives into topics such as the False Claims Act (FCA), antitrust issues, and state Attorney General (AG) issues.

2. How can I register for upcoming webinars in the series?
You can register for upcoming webinars by clicking the 'Register for Upcoming Events' button on your webinar console.

DOJ Criminal Enforcement Priorities

1. What are the main focus areas of the DOJ's criminal enforcement priorities?
The DOJ's criminal enforcement priorities include healthcare fraud, protection of financial markets, transnational conduct, money laundering and bribery, and digital assets.

2. What significant healthcare fraud enforcement action was recently announced?
In late June, the DOJ announced the largest ever healthcare fraud takedown, involving criminal charges against 324 defendants across 50 federal districts and 12 states, with alleged fraudulent claims amounting to $14.6 billion.

3. What is the DOJ's stance on digital assets enforcement?
The DOJ will prioritize cases that involve conduct victimizing investors and consumers, and crimes using digital assets in furtherance of other criminal conduct. Prosecutors are directed not to charge regulatory violations unless there is evidence of willful violation.

False Claims Act (FCA) Enforcement

1. What are some recent initiatives related to the FCA in the healthcare industry?
The DOJ and HHS announced a working group to coordinate FCA enforcement in the healthcare space, focusing on Medicare Advantage, drug and device pricing, kickbacks, and data manipulation for inflated billing purposes.

2. How is the FCA being used to address customs and tariff fraud?
The DOJ has used the FCA to address customs and tariff fraud, including cases where companies failed to declare the correct country of origin and value on products, and evaded anti-dumping and countervailing duties.

3. What is the DOJ's approach to PPP loan fraud under the FCA?
The DOJ continues to investigate and prosecute PPP loan fraud, focusing on eligibility, loan amounts, loan forgiveness, and misuse of funds. Recent settlements include significant monetary judgments and consent decrees.

Antitrust Enforcement

1. What are the current priorities of the DOJ Antitrust Division and the FTC?
The DOJ and FTC are committed to enforcing the 2023 merger guidelines, focusing on technology, agriculture, and healthcare sectors. They are also open to considering remedies for potentially anti-competitive mergers.

2. How is the FTC addressing non-compete agreements?
The FTC has stepped back from a broad federal prohibition on non-competes but continues to challenge specific non-compete agreements under Section 5 of the FTC Act, particularly those affecting hourly employees and healthcare workers.

State Attorney General (AG) Enforcement

1. What are some current enforcement priorities of state AGs?
State AGs are focusing on consumer protection, youth online safety, AI misrepresentation, and rural issues. They are also stepping in to fill perceived regulatory voids left by federal agencies.

2. How are state AGs addressing antitrust issues?
State AGs are independently challenging mergers and pursuing antitrust enforcement in local markets. They are also enacting new laws, such as mini HSR laws and pre-transaction notification laws in the healthcare space.

Blog: DOJ Enforcement Priorities: Key Focus Areas for Compliance in 2023

Government enforcement priorities are a critical area of focus for businesses, especially those operating in highly regulated industries. The Department of Justice (DOJ) and other federal agencies have identified specific areas for concentrated efforts, such as healthcare fraud, financial market protection, transnational crime, money laundering, bribery, and digital assets. Understanding these priorities is essential for businesses to navigate compliance requirements and mitigate risks associated with federal investigations. This blog explores the key areas of focus for enforcement activities, including customs and tariff enforcement, cybersecurity compliance, PPP loan fraud, illegal discrimination, antitrust priorities, monopolization in the tech industry, and non-compete agreements.

DOJ Enforcement Priorities: Healthcare, Financial Markets, Digital Assets, and More

Healthcare fraud is a major focus for the DOJ, with initiatives like the largest ever healthcare fraud takedown involving charges against 324 defendants and $14.6 billion in fraudulent claims. This underscores the importance of cross-agency collaboration and data analytics in detecting and prosecuting fraud. Healthcare businesses must ensure robust compliance programs to avoid enforcement actions.

Financial market protection is also a priority. The DOJ has reorganized its market integrity and major frauds unit to prosecute companies evading tariffs, highlighting a focus on fair competition and investor protection. Companies in financial markets must strengthen compliance efforts, particularly in securities fraud, market manipulation, and elder fraud. The DOJ's emphasis on prosecuting individual bad actors reinforces the need for a culture of compliance.

Digital assets are under increased scrutiny, with the DOJ prioritizing cases involving financial harm to investors and consumers or the use of digital assets in other crimes. The department will not target virtual currency exchanges for end-user actions unless there is evidence of willful violations. Companies in this sector should stay informed about regulatory developments and ensure adequate controls to prevent misuse of digital assets.

Bribery and FCPA violations are high on the DOJ's agenda. The department considers factors like eliminating cartels and transnational criminal organizations, safeguarding fair opportunities for U.S. companies, and protecting national security. Corporate leaders must be proactive in preventing and addressing bribery and corruption by implementing comprehensive compliance programs and regular training.

Customs and tariff enforcement is critical, with the DOJ using the FCA to bolster trade enforcement. Recent cases highlight the importance of accurate reporting and compliance with trade regulations to avoid penalties and legal repercussions.

Cybersecurity compliance is a key area for FCA enforcement, especially with the DoD's cybersecurity maturity model program now mandatory for all DoD contracts. Companies in defense contracting must prioritize cybersecurity to meet regulatory requirements and avoid FCA violations.

PPP loan fraud remains a significant focus, with the DOJ announcing settlements related to ineligibility, misuse of funds, and false claims. Businesses must adhere strictly to government assistance program guidelines to prevent fraud and legal consequences.

Illegal discrimination is actively enforced by the DOJ using the FCA. Following executive orders and memoranda, the DOJ investigates and penalizes discriminatory practices in institutions receiving federal funds, promoting equality and fair practices.

Antitrust priorities reflect continuity and change, with the DOJ and FTC enforcing merger guidelines and Hart-Scott-Rodino Act rules to prevent anti-competitive mergers. There is a focus on encouraging pro-competitive and neutral mergers, particularly in tech and startups, while challenging deals that pose competitive harm. The DOJ scrutinizes alleged monopolization in the tech industry to open markets and encourage innovation. The FTC challenges non-compete agreements, especially for lower-level employees, to promote fair competition and labor market practices.

Businesses must stay informed about government enforcement priorities to navigate the complex regulatory landscape effectively. The DOJ's focus on healthcare fraud, financial market protection, digital assets, and bribery underscores the need for robust compliance programs and proactive risk management strategies. Understanding these priorities helps companies reduce the likelihood of federal investigations and enforcement actions, safeguarding their operations and reputation. Compliance across various sectors, including trade, cybersecurity, antitrust, and labor practices, is crucial to avoiding legal pitfalls. Staying informed and actively ensuring compliance mitigates risks and maintains operational integrity in a scrutinized environment.