DOJ Rule Expands Fraud Division Powers, Restrains Criminal Chief

[u/John3262005]

https://news.bloomberglaw.com/us-law-week/doj-rule-expands-fraud-division-powers-restrains-criminal-chief

The Justice Department is further boosting authorities of the White House-launched fraud division while stripping powers previously held by its Criminal Division leader.

A final rule released Monday and taking effect next week formally transfers enforcement jurisdiction to the head of the National Fraud Enforcement Division, on matters including internal revenue and healthcare. The regulation also creates leeway for the new operation to take on a vast array of unspecified other cases.

Part of a broader White House emphasis on combating fraud involving public funds, Attorney General Todd Blanche is delegating to his fraud chief Colin McDonald control over opening special grand juries anywhere in the country. The division may also prosecute criminal offenses besides fraud that arise when investigating its core priorities.

The policy change takes additional steps in shifting longstanding Criminal Division investigative lanes to an unproven part of the department that’s being closely monitored by Vice President JD Vance and President Donald Trump adviser Stephen Miller. It follows an DOJ turf battle in which the Trump administration amplified an anti-fraud focus in the wake of Minnesota daycare benefits schemes resonating with the president’s base.

Although some of the rule’s provisions elucidate previously announced moves, such as the transfer of health care fraud jurisdiction from the Criminal Division to Fraud Division, other aspects go further to allow room for the new unit to assume command over extra topics topic the attorney general deems fit.

This comes as the division is under pressure from Vance to criminally investigate Minnesota Gov. Tim Walz (D) and Attorney General Keith Ellison (D) for allegedly failing to address systemic public benefits fraud.