2025 has been a landmark year for False Claims Act (FCA) enforcement, marked by record-breaking settlements, evolving legal theories, and a broadening scope of government priorities. The FCA remains one of the federal government’s most potent tools for combating fraud, with billions recovered annually and an ever-expanding reach into new sectors and compliance areas. This roundup synthesizes the year’s most significant developments—drawing on recent case law and shifting enforcement priorities—and provides actionable insights for businesses navigating the FCA landscape.
Case Law Update: Constitutional Challenges and Qui Tam Relators
In 2025, the constitutionality of the FCA’s qui tam provisions—which empower private litigants (relators) to prosecute fraud claims on the government’s behalf—continued to emerge as a focal point of judicial debate. Historically, federal courts, including the U.S. Court of Appeals for the Fifth, Sixth, Ninth, and Tenth Circuits, have rejected arguments challenging the constitutionality of qui tam actions, emphasizing that the government retains significant control over litigation even when a relator pursues a case independently. Recent district court decisions often emphasize the FCA’s longstanding role in federal fraud enforcement.
However, a district court decision in the Middle District of Florida in United States ex rel. Zafirov v. Fla. Med. Assocs., LLC held that the FCA’s qui tam provisions violate the Appointments Clause in Article II of the U.S. Constitution, with a growing minority of judges voicing similar concerns.
For now, while the majority of courts uphold the FCA’s qui tam provisions against constitutional challenges, the issue remains poised for further judicial scrutiny in 2026. Indeed, in December, the U.S. Court of Appeals for the Eleventh Circuit heard arguments in the appeal from the district court’s decision in the Zafirov case. Likewise, the courts of appeals in the Third and Sixth Circuits are poised to consider the issue, and judges in the Fifth Circuit have indicated an interest in reconsidering the matter in the right case. Husch Blackwell’s False Claims Act practice will continue to monitor developments in this area.
Read more: Courts Clash Over Qui Tam Relators and the Constitution
Listen to more: False Claims Act Insights – The Latest on Zafirov and the Future of Qui Tams
Enforcement Priorities
Healthcare: Continued Priority
Healthcare fraud continues to dominate FCA enforcement, accounting for the majority of FCA recoveries. In 2025, several high-dollar settlements underscored the government’s continued focus on the healthcare industry. Notable settlements include:
- Pfizer Inc., on behalf of its subsidiary Biohaven Pharmaceutical Holding Company Ltd., for nearly $60 million to resolve allegations related to Anti-Kickback Statute violations;
- Independent Health Association and its affiliate, for $98 million, to resolve allegations that they submitted unsupported diagnosis codes to Medicare for Medicare Advantage Plan enrollees; and
- Seoul Medical Group Inc., its subsidiary Advanced Medical Management Inc., and related parties, for over $62 million, to resolve allegations of causing the submission of false diagnosis codes for spinal conditions to increase Medicare Advantage payments.
On July 2, 2025, the U.S. Department of Justice (DOJ) and the Department of Health and Human Services (HHS) formally reestablished their FCA Working Group, marking a new era of interagency coordination in healthcare fraud enforcement. This initiative brings together leadership from DOJ’s Civil Division, HHS Office of General Counsel, the Centers for Medicare & Medicaid Services (CMS), and the HHS Office of Inspector General, with the goal of streamlining investigations, accelerating case referrals, and leveraging advanced data analytics to uncover fraud in federal healthcare programs such as Medicare and Medicaid.
The Working Group’s mission is to prioritize high-impact enforcement areas, including Medicare Advantage risk adjustment fraud, kickbacks, defective medical devices, manipulation of electronic health records, and drug/device pricing schemes. By facilitating real-time data sharing and unified strategic priorities, the group aims to enhance both the efficiency and effectiveness of FCA investigations—signaling to healthcare providers, payors, and contractors that scrutiny of billing practices and compliance programs will intensify.
The Working Group is expected to make high-priority FCA referrals from HHS to DOJ, coordinate enforcement decisions—including DOJ’s use of dismissal authority in qui tam cases—and leverage data mining to proactively identify new leads, separate from whistleblower complaints. Ultimately, this initiative reflects the government’s sharpened focus on preventing fraud through smarter oversight and faster action, and underscores the importance for healthcare entities to proactively assess FCA exposure and strengthen compliance programs to mitigate enforcement risk.
Read more: DOJ and HHS Launch New False Claims Act Working Group: What The Healthcare Industry Needs to Know
PPP Loans: Ongoing Civil Enforcement
Federal scrutiny of Paycheck Protection Program (PPP) loans remains a major enforcement priority under the FCA in 2025. The DOJ continues to audit and investigate PPP loan applications and forgiveness requests, targeting misrepresentations and fraudulent certifications. Recent enforcement actions highlight the government’s commitment to holding businesses accountable for inaccurate statements regarding eligibility, use of funds, and compliance with program requirements.
Read more: PPP Loan Audits and Investigations Expected to Continue; Mid-Year Update: PPP Investigations Continue as DOJ Enforcement Priority; PPP Loan Fraud Civil Enforcement through the False Claims Act
Customs and Tariffs: An Expanding Frontier
In 2025, FCA enforcement expanded into the realm of trade tariffs and customs, reflecting a shift in federal priorities under the current administration’s tariff-focused trade regime. The DOJ and U.S. Customs and Border Protection (CBP) have prioritized investigations of trade fraud, including mislabeling goods, disguising country of origin, and improper classification to avoid higher duties. FCA liability extends to “reverse false claims,” where importers or manufacturers knowingly avoid paying money owed to the government, such as customs duties or antidumping/countervailing duties. Recent DOJ resolutions have involved multimillion-dollar settlements for companies that failed to declare the correct country of origin or value on imported goods, or that evaded duties by misclassifying products. The launch of the DOJ–Department of Homeland Security (DHS) Trade Fraud Task Force in August 2025 further underscores the government’s commitment to combating tariff evasion, leveraging resources from both the DOJ’s civil and criminal divisions to pursue significant penalties.
The evolving enforcement landscape has heightened risks for importers, manufacturers, and supply chain participants. As DOJ continues to encourage whistleblower participation and interagency collaboration, businesses should treat FCA enforcement of trade tariffs as a serious compliance issue and prepare for increased scrutiny in customs and import operations.
Read more: FCA Enforcement May Increase In a Tariff Focused Trade Policy Regime; DOJ and DHS Announce New Task Force to Counter Tariff Evasion
DE&I Representations: Executive Order 14173 and FCA Risk
The federal government’s approach to anti-discrimination law enforcement in 2025 is embodied in Executive Order 14173 and related DOJ guidance, signaling an aggressive use of the FCA to target diversity, equity, and inclusion (DE&I) practices deemed illegal. Certain DE&I policies—such as race- or sex-based preferences in hiring, admissions, scholarships, or contracting—have been deemed by the administration to be potential violations of federal anti-discrimination laws. The DOJ’s Civil Rights Fraud Initiative further encourages qui tam relators to bring FCA suits against entities suspected of violating anti-discrimination statutes through their DE&I programs.
Federal contracts and grants increasingly require express certifications of compliance with anti-discrimination laws, and misrepresentations can trigger FCA liability. Under the FCA, organizations that certify compliance with these laws while knowingly operating programs deemed discriminatory may face treble damages, significant penalties, and whistleblower lawsuits. As federal scrutiny intensifies, organizations should proactively audit their DE&I policies, seek legal counsel, and ensure that all certifications and public statements accurately reflect their compliance posture to mitigate the risk of FCA investigations and penalties.
Read more: Legal Perspectives on Executive Order 14173, DEI, and the False Claims Act
Listen to More: False Claims Act Insights – Recent Federal Executive Actions Place Anti-Discrimination Within the FCA’s Orbit
Cybersecurity: False Certifications and Breach Reporting
In 2025, DOJ intensified its use of the FCA to enforce federal cybersecurity requirements, targeting contractors and grantees who misrepresent their compliance or fail to correct known vulnerabilities—even when no breach occurs. Through the Civil Cyber-Fraud Initiative, DOJ has pursued multimillion-dollar settlements against companies that falsely certified adherence to standards such as NIST SP 800-171, Cybersecurity Maturity Model Certification (CMMC), and ISO, or failed to timely report cyber incidents as required by contract. Recent cases, including settlements with defense and technology contractors, underscore that incomplete or unsupported cybersecurity certifications can carry the same consequences as any other false claim. The evolving legal landscape makes cybersecurity not just a technical issue but a compliance imperative, requiring contractors to ensure their systems, certifications, and breach reporting are accurate and defensible.
What Businesses Should Do Now
Given the breadth and intensity of FCA enforcement in 2025, which is likely to continue or even intensify in 2026, businesses should take proactive steps to mitigate risk: strengthen compliance programs, review contractual certifications, monitor regulatory changes, train employees, and engage legal counsel.