In 2025, Department of Justice (DOJ)’s Civil Cyber-Fraud Initiative drove major False Claims Act (FCA) settlements involving defense contractors, research institutions, and health care companies—highlighting the need for strict compliance with NIST, DFARS, and FedRAMP requirements, as well as proactive self-disclosure and due diligence.

KEY POINTS:

• Cybersecurity enforcement remains a priority. DOJ’s Civil Cyber-Fraud Initiative continues to drive FCA enforcement actions, with 2025 seeing multiple settlements primarily involving defense contractors and one significant health care case — signaling that cybersecurity compliance remains a focus for companies doing business with the government.
• Self-disclosure and cooperation reduce penalties. Companies that voluntarily disclose cybersecurity failures and cooperate with investigations receive substantial benefits, such as reduced damages multipliers.
• Successor liability and investor risk are real. DOJ may impose liability on successor entities for predecessors’ cybersecurity failures. Private equity firms and acquirers should conduct thorough due diligence and consider self-disclosure if noncompliance is discovered post-acquisition.
• Criminal exposure and heightened penalties are emerging. DOJ may impose harsher penalties for egregious violations, including multipliers exceeding the typical FCA standard.

While the Trump administration announced many new FCA enforcement priorities in 2025, one enforcement area from recent...

Read Full Story: https://news.google.com/rss/articles/CBMiigFBVV95cUxNREtOcklRc1k4V1NjM0ZncGVG...