For nearly a year, the U.S. Department of Justice (DOJ) has signaled its intent to use the False Claims Act (FCA) to police what it terms “illegal diversity, equity, inclusion, and accessibility” practices by federal contractors and grant recipients. On April 10, 2026, the DOJ announced that a federal contractor agreed to pay $17 million to resolve FCA allegations arising from allegedly discriminatory employment practices tied to its diversity, equity, and inclusion (DEI) programs. This settlement represents the first public resolution under the DOJ’s Civil Rights Fraud Initiative and signals that the administration’s FCA-based enforcement of antidiscrimination certifications is now an operational reality that recipients of federal funds must take seriously.
This Alert examines the scope of the DOJ’s Civil Rights Fraud Initiative, the allegations and resolution terms in the recently announced settlement, and what this development means for other recipients of federal funds. We conclude with practical recommendations for assessing and mitigating risk.
In January 2025, the Trump administration issued Executive Order 14173, Ending Illegal Discrimination and Restoring Merit Based Opportunity, which in part requires federal contractors and grant recipients to certify that they do not operate DEI programs that violate federal antidiscrimination laws and to agree that compliance with those laws is “material to the government’s payment decisions” for FCA purposes. Shortly...
Georgia Attorney General Chris Carr announced Tuesday that federal charges have been filed against a local doctor who allegedly submitted more than $4 million in false billings to Georgia Medicaid...