On May 19, 2025, Deputy Attorney General Todd Blanche issued a Memorandum creating the Civil Rights Fraud Initiative that will “utilize the False Claims Act to investigate and . . . pursue claims against any recipient of federal funds that knowingly violates federal civil rights laws.” According to the Memorandum, though racial discrimination has “always been illegal,” the Administration posits that “many corporations and schools continue to adhere to racist policies and preferences—albeit camouflaged with cosmetic changes that disguise their discriminatory nature.” In an effort to prevent federal funds from being used in connection with or support of these purportedly racist policies and preferences, the Initiative will wield the power of the False Claims Act, the government’s most powerful tool to fight fraud, waste, and abuse.
This Memorandum follows and bolsters President Trump’s Executive Order (EO) No. 14173, Ending Illegal Discrimination and Restoring Merit-Based Opportunity (Jan. 21, 2025), often referred to as the “Anti-DEI Executive Order,” which seeks to end “illegal” diversity, equity, and inclusion (DEI) efforts by recipients of federal funding. Most pertinent, EO 14173 directed agencies to include terms in every federal contract or grant award requiring the contractor to agree that its compliance with applicable federal anti-discrimination laws is material to the government’s payment decisions, for purposes of the False Claims Act’s materiality element, and...
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