On October 1, 2026, the head of the Department of Justice’s new National Fraud Enforcement Division, Assistant Attorney General Colin M. McDonald, issued Directive 26-12: Corporate Enforcement in the Fight Against Fraud. The directive tells every prosecutor in the Division how to go after companies that that it believes are committing fraud. It signals a faster, more organized, and more aggressive era of corporate enforcement.

Here is what businesses need to know.

A dedicated team for corporate cases

The directive puts a newly created Corporate Enforcement Section at the center of the Division’s work. This specialized team leads and coordinates corporate fraud cases across the country, from the first day of an investigation through any settlement, plea, or trial.

The practical effect for companies is significant:

• A seven-day clock. Prosecutors have to report every ongoing corporate investigation to the new Section within a week of the directive. In other words, existing matters are already being pulled together and reviewed centrally.
• One set of experts watching every deal. The Section also oversees whether companies live up to the terms of any settlement — monitoring compliance programs and reporting obligations. Businesses that resolve a case should expect sustained, specialist scrutiny, not a one-and-done agreement.
• More prosecutors freed up for more cases. By centralizing this work, the Division says it is freeing its other attorneys to bring even more individual and corporate cases.

Where enforcement will hit hardest

The directive names four priority areas where prosecutors are told to focus:

• Health care — including health care fraud, illegal distribution of controlled substances, and food-and-drug violations.
• Government and public funds — procurement fraud, government contracting fraud, and schemes that undermine public trust or the financial integrity of markets.
• Tax — schemes involving significant evasion of government revenue.
• Trade — tariff evasion, import fraud, and supply chains tied to forced labor.

If your company operates in any of these spaces — or handles federal dollars in any form — you are squarely within the Division’s sights.

What makes a case worse

The directive lists the “aggravating” factors that lead prosecutors to charge harder and negotiate tougher. A matter draws heightened attention when it involves:

• Knowledge or involvement by company management
• Concealment from regulators or auditors, or obstruction of government oversight
• Misconduct that lasted three years or more
• Threats to the safety or security of Americans, including military readiness
• Substantial financial harm to a taxpayer-funded program
• Impact across multiple programs, three or more federal districts, or 25 or more victims / $25 million or more in losses
• Money funneled to foreign adversaries
• Related immigration offenses

This is not a checklist with a bright line — prosecutors can weigh other factors too. But it is a clear roadmap to the conduct the Division considers most serious.

Credit for doing the right thing

The directive is not only a warning. It repeatedly emphasizes rewarding companies that come forward. Prosecutors are directed to follow the Department’s longstanding policies — the Principles of Federal Prosecution of Business Organizations and the Corporate Enforcement and Voluntary Self-Disclosure Policy — which give meaningful credit to businesses that voluntarily disclose misconduct, cooperate with investigators, and fix the underlying problems.

The directive also stresses that enforcement should be fair, not overbroad — the Division says it wants to distinguish between genuine wrongdoing and legitimate business operations, and to protect law-abiding companies.

A louder call for whistleblowers

Finally, the directive leans hard into whistleblowers. It directs Division leadership to build new programs that encourage and protect people who report fraud — expressly including insiders who may have taken part in the misconduct themselves. Combined with the Division’s National Fraud Detection Center and its heavy use of data analytics, the message is that leads are being generated faster and from more directions than ever before.

How this builds on the Division’s earlier priorities memo

Directive 26-12 follows the Fraud Division’s earlier memo of August 13, 2026, which set out the Division’s overall enforcement priorities. Reading the two together shows what the new directive means for individuals — not just companies.

The August memo was the Division’s charter. It named five priority areas — public trust and financial integrity, health care, tax, global trade and commerce, and corporate misconduct — and made clear the Division would pursue both organizations and individuals who defraud the government and the public. Its unifying promise was to

“systematically target, prosecute, and imprison fraudsters” — language aimed squarely at people, not only corporate entities.

Directive 26-12 is narrower: it governs how prosecutors handle corporate cases. But it does not pull back from individual accountability. If anything, it reinforces it at nearly every step:

Individuals remain a named target. The directive’s stated purpose includes holding “individuals and corporate criminals accountable,” and it describes strong corporate enforcement as something that “furthers individual prosecutions.”

Corporate resolutions will not shield the people involved. By moving compliance-monitoring to the new Corporate Enforcement Section, the directive frees up line prosecutors to pursue “additional individual and corporate cases.” Resolving a company’s case is not the end of individual exposure.

Management conduct drives the outcome. The single most heavily weighted aggravating factor is knowledge of, or involvement in, the fraud by company management — tying charging decisions directly to what individuals did.

Insiders are being invited in. The new whistleblower push expressly covers people who took part in the misconduct themselves — a direct channel into cases against individual actors — backed by the National Fraud Detection Center’s data-driven lead generation.

The two memos tell one consistent story. In August the Division built the apparatus and set the priorities, targeting individuals and companies across five sectors. In October it sharpened the corporate-enforcement machinery in a way that also feeds individual accountability. The directive adds no separate rulebook for charging individuals — that remains governed by the broader August priorities — but it leaves individual enforcement fully intact and, through freed-up prosecutors and a culpable-insider pipeline, tilts the field toward more individual cases, not fewer.

The bottom line for businesses

Directive 26-12 tells companies three things at once: enforcement is more coordinated, the priority targets are clearly marked, and the government is actively recruiting insiders to bring cases forward. The flip side is just as clear — businesses that invest in strong compliance, move quickly on red flags, and make well-advised decisions about voluntary disclosure stand to benefit from the very credit the directive promises.

The companies that fare best in this environment will be the ones that get ahead of it — by strengthening compliance now and bringing in experienced counsel early, long before the government comes knocking.