DOJ sending FCA investigatory letters on DEI

The U.S. Department of Justice (DOJ) has started investigating federal contractors and grant recipients for allegations that diversity, equity, and inclusion (DEI) programs violate antidiscrimination laws. 

Background

In addition to revoking Executive Order (EO) 11246, President Trump’s January 31, 2025, EO 14173, Ending Illegal Discrimination and Restoring Merit-Based Opportunity, also added a new certification requirement for recipients of federal funding, including federal contractors. The new certification in Section 3(iv)(A) & (B) provides that every contract and grant will include a term requiring the recipient to agree that:

Its compliance in all respects with all applicable Federal anti-discrimination laws is material to the government’s payment decision for purposes of section 3729(b)(4) of title 31, United States Code and

Certify that it does not operate any programs promoting DEI that violate any applicable Federal anti-discrimination laws.

Title 31, Section 3729 (b)(4) is the False Claims Act (FCA), a Civil War-era law that is used by the federal government to combat fraud involving false claims for payment. It imposes treble damages and penalties on individuals or entities that knowingly submit false claims or cause such claims to be submitted to the federal government.

DOJ Civil Rights Fraud Initiative