7 minute read | September.24.2026
On September 18, 2026, the Department of Justice (DOJ) announced two major changes to its internal False Claims Act (FCA) enforcement guidance.
The first change limits DOJ’s use of nonbinding guidance as the basis for bringing cases. The second change addresses when the government may proactively dismiss whistleblower-initiated FCA suits. This attention to the FCA, even as procedural modifications, reflect the Trump administration’s ongoing focus on the statute as a key tool for fighting fraud. Any company or organization that contracts with the federal government or receives federal funds should be familiar with the FCA and the risks it presents.
The FCA imposes liability on any person who knowingly submits, or causes to be submitted, false claims to the United States government (31 U.S.C. §§ 3729-3733). A fraud statute, the FCA allows the government to pursue cases against any party that receives federal funds, including contractors, subcontractors, grantees, health care organizations, and others. The FCA also empowers private parties—called “relators” under the statute, and more commonly referred to as whistleblowers—to bring cases on behalf of the government and receive up to 30% of the recovery. In such “qui tam” actions, DOJ has the option to intervene, i.e., take over the matter; allow the case to proceed with the relator acting for the government; or ask the court to dismiss the case, as the government remains the real party in interest.
FCA enforcement guidance and policies are set forth in the Justice Manual, which covers DOJ policies and procedures. Previously referred to, and better known as, the U.S. Attorneys’ Manual, it gives operational direction and serves as a reference tool for federal prosecutors and staff on how to investigate and litigate matters. Modifications to these policies are driven and reviewed by senior DOJ officials (§ 1-1.30).
Prior Use and Limitations. Historically, the federal government has sometimes relied upon agency guidance to define an obligation enforceable through litigation. Under the first Trump administration, DOJ prohibited the use of agency guidance documents to create rights or legal obligations. Such materials, including memoranda, policy statements, FAQs, and informal directives, are not legally binding and cannot create obligations enforceable through litigation. The Biden administration rescinded this policy in 2021. These latest revisions to the Manual reinstate and expand the prior Trump administration position.
Current Limits on Use in Litigation & Enforcement. The updated Justice Manual clarifies that civil and criminal enforcement must be based on a violation of a legal requirement. As applied to the FCA, noncompliance with agency guidance cannot form the basis of an FCA violation. DOJ must instead identify a binding obligation rooted in statute, regulation or enforceable contractual provision.
Enforcement actions cannot be founded on sub-regulatory guidance—memoranda, policy statements, FAQs, advisory opinions, informal directives—as these are insufficient to establish a legal obligation. This does not, however, mean all such guidance is irrelevant. The government contemplates that some limited reliance may be appropriate, giving the following examples of permissible use:
These carve-outs are substantial and affirm that companies should not ignore relevant guidance. Rather, the revisions draw a distinction between the impermissible use of guidance as a basis for establishing liability, versus permissible uses to prove elements of a claim.
The second revision shifts DOJ’s approach to dismissing qui tam actions. Under the FCA, if DOJ declines to intervene and take over a case, the relator can still proceed with the claims, with the government remaining as a party in interest or DOJ can look to dismiss the matter entirely (31 U.S.C. § 3730(c)(2)(A)). This revision indicates the government will more regularly assess possible use of its dismissal authority.
Prior Developments. In 2018, the government set out a framework for evaluating dismissal of qui tam cases and then incorporated it into the Justice Manual. Per that guidance, factors to be considered in evaluating whether to seek dismissal include: curbing meritless qui tam actions; preventing parasitic or opportunistic suits; preventing interference with agency policies and programs; controlling litigation brought on behalf of the United States; safeguarding classified information and national security; preserving government resources; and avoiding adverse precedent.
In 2023, the Supreme Court affirmed DOJ’s broad discretion to seek dismissal, holding that DOJ may intervene and seek dismissal at any stage of the litigation. Still, historically DOJ has rarely exercised its authority to dismiss a qui tam case, doing so in fewer than 1% of all FCA cases.
That may have started to change with the second Trump administration. DOJ reports that in 2025 it proactively dismissed 25 qui tam cases, all apparently over the objections of those relators.
Expanding Review for Potential Dismissal. The updated Manual now directs that DOJ attorneys should in every case assess whether the government’s interests are served by seeking dismissal. More specifically, the Manual now directs that even where DOJ initially declines to intervene or dismiss, it must revisit that assessment and the possibility of dismissal as the qui tam litigation proceeds. The revisions also broaden the dismissal factors concerning “[c]urbing meritless qui tams,” which the Manual had previously described as those “that facially lack merit (either because the relator’s legal theory is inherently defective, or the relator’s factual allegations are frivolous).” The updated guidance removes that qualifying language, apparently giving DOJ prosecutors more latitude to determine what constitutes a meritless FCA claim.
At the same time, the revisions caution that dismissal “will not be warranted in every declined case, because to maximize its resources the government often will investigate a qui tam action only to the point where it concludes a declination is warranted, which may not equate to the conclusion that a qui tam is meritless.”
The revisions also add a procedural requirement. Any U.S. Attorneys’ Office, the local federal prosecutors who often take the lead in investigating FCA claims, must “provide notice to the assigned Fraud Section attorney” meaning those assigned to the Civil Fraud section in Main Justice in Washington, “at least 10 days prior to filing any motion to dismiss…” This revision appears designed to increase central oversight of local federal prosecutor’s decisions in FCA matters.
The revision comes against a backdrop of record qui tam activity and sustained interest from the Trump administration in using the FCA to achieve federal enforcement priorities.
These Justice Manual revisions may reflect the Trump administration's broader emphasis on using the FCA as a key enforcement tool. One example of that effort, in May 2025 DOJ established the Civil Rights Fraud Initiative to facilitate use of the FCA to help bring claims against recipients of federal funds that knowingly violate federal civil rights laws, calling out companies and institutions that “promote divisive DEI policies” and “anti-Semitism.” DOJ has also announced FCA resolutions against three leading federal contractors (starting with the April 2026 FCA settlement with IBM), each resolving allegations that the contractors falsely certified compliance with nondiscrimination requirements while maintaining policies and practices that discriminated on the basis of race or sex.
The memorandum launching the Civil Rights Fraud Initiative concluded by recognizing that DOJ “alone cannot identify every instance of civil rights fraud” and by “strongly encouraging” qui tam lawsuits. The numbers show Relators were already bringing FCA suits at a record place, filing a record 1,297 qui tam lawsuits in fiscal year 2025, breaking the prior record of 980, with FCA recoveries reaching $6.8 billion last year.