DOJ Announces Dramatic Shift in Enforcement Priorities and Resources, Potentially Reshaping White-Collar Enforcement Landscape

Attorney General Pam Bondi began her first day at the U.S. Department of Justice (“DOJ”) mandating a significant shift in enforcement priorities and parallel organizational changes with potentially far-reaching consequences for FCPA and other white-collar enforcement. Through two February 5 memoranda, General Policy Regarding Charging, Plea Negotiations and Sentencing and Total Elimination of Cartels and Transnational Criminal Organizations (“the Memoranda”), the Attorney General signaled a significant shift in focus toward the enforcement of laws combatting international organized crime, narcotics trade, illegal immigration, and human trafficking and away from other areas, such as international corruption.

The General Policy Memorandum also implements in part Executive Order 14147 (issued on President Trump’s first day in office) ordering the cessation of the “weaponization” of law enforcement against political opponents by directing that prosecutorial decisions be devoid of political animus.

Although questions remain about how these policy memoranda will be implemented and their effect on existing investigations and cases, they could have major implications across a number of areas that will affect companies operating transnationally. And, as explained below, while some of these changes suggest a diminished enforcement footprint, in fact they may presage only a shift in focus.

1. New Enforcement Priorities

Cartels and Transnational Criminal Organizations (“TCOs”)

In line with President Trump’s stated goal of eliminating cartels and TCOs, the Memoranda announced new strategies for charging such organizations, including reallocating resources and focusing on cartel and TCO leaders. For instance, the Memoranda direct that leaders of such organizations be prosecuted as terrorists (consistent with Executive Order 14157, which creates a process to designate cartels and TCOs as terrorists). (Please see our alert on that subject.)

Narrower Focus for Foreign Corrupt Practices Act (“FCPA”)

The General Policy Memorandum directs that the Criminal Division’s FCPA Unit “prioritize” investigations of foreign bribery that “facilitate the criminal operations of Cartels and TCOs,” rather than FCPA cases that lack such features. The Memorandum provides as examples of cases to prioritize those involving the “bribery of foreign officials to facilitate human smuggling and the trafficking of narcotics and firearms.” Because such FCPA matters have never previously been a focus of the FCPA unit, this directive amounts to a sea-change in FCPA enforcement. The acute focus suggests that DOJ will aggressively pursue companies that facilitate cartel and TCO activity, potentially even where the connection to such activity is tangential, unwitting, or would not previously have drawn enforcement scrutiny.

Changes to Foreign Agents Registration Act (“FARA”) Enforcement

The General Policy Memorandum directs that the Justice Department’s use of the criminal provisions of FARA and FARA’s sister statute—18 U.S.C. § 951—should be limited to “instances of alleged conduct similar to more traditional espionage by foreign government actors.” This marks a dramatic shift from the last several years, during which DOJ has routinely brought new criminal cases against government officials and corporate executives, often based on conduct that could be viewed as ordinary business activity.

Instead, the Memorandum directs the FARA Unit to focus its resources on “civil enforcement, regulatory initiatives, and public guidance.” At a December 2024 conference, senior DOJ officials noted that 2024 set a record for letters of inquiry, which is a DOJ request for information to a potential registrant to determine if FARA registration is necessary. The new directive implies that this focus on FARA’s civil enforcement mechanisms over criminal prosecution will continue.

Illegal Immigration

The General Policy Memorandum prioritizes the prosecution of illegal immigration, with a focus on pursuing undocumented migrants as well as state and local actors that resist, obstruct, or fail to comply with immigration-related commands.

Human Trafficking and Smuggling

The General Policy Memorandum announces a priority to pursue human trafficking and smuggling crimes, with a focus on those that arise from illegal immigration from Central and South America.

2. Organizational Changes

Consistent with the shift in enforcement priorities, the Memoranda announce various organizational changes intended to shift resources to areas of enforcement priority and streamline the processes to more efficiently launch investigations in those priority areas.

Disbanding of National Security Division Corporate Enforcement Unit

The General Policy Memorandum directs the disbanding of the National Security Division’s Corporate Enforcement Unit, which was established during the Biden Administration to turbocharge corporate investigations that implicate national security, such as economic sanctions and export controls.

Disbanding of Foreign Influence Task Force

The Memorandum also directs that the Foreign Influence Task Force be disbanded. That task force was created in the fall of 2017 during the first Trump Administration by former FBI Director Christopher Wray. At the time, the stated goal of the task force was to identify and counteract malign foreign influence operations targeting the United States, including through investigations and operations, information and intelligence sharing, and private sector partnerships. Disbanding this task force appears to be in keeping with the new directive for the FARA Unit to focus on civil enforcement mechanisms rather than criminal prosecution.

Re-alignment of Process for Anti-Corruption Matters

For matters related to foreign bribery associated with cartels and TCOs, the General Policy Memorandum lifts the requirements that the Criminal Division authorize the investigation and prosecution of FCPA cases and that such investigations and prosecutions be handled by attorneys from the Criminal Division’s FCPA Unit.

The General Policy Memorandum also disbands Task Force KleptoCapture, the Department’s Kleptocracy Team, and the Kleptocracy Asset Recovery Initiative, all of which focused on enforcing economic sanctions and export control restrictions targeting Russian oligarchs and other persons evading the measures imposed following the Russian invasion of Ukraine.

3. Implications

Together, the Memoranda clearly signal the Trump Administration’s major enforcement priorities. Questions remain on how the priorities will be implemented within DOJ components. In the near term, it is unclear whether these changes will affect existing investigations or cases.

With respect to FCPA enforcement, if the FCPA Unit implements the General Policy Memorandum by focusing only on cartels and TCOs, or even if such investigations comprise a majority of FCPA investigations, it will constitute the most dramatic change to FCPA enforcement in decades. Few, if any, of the Department’s prior FCPA prosecutions related to cartels or TCOs. And much of the Department’s traditional corporate compliance guidance and its array of corporate resolutions—for example, the possibility of a “declination with disgorgement”—would be inapplicable to a cartel or TCO.

It remains to be seen whether the “prioritization” of cartel and TCO cases will functionally prohibit traditional FCPA prosecutions of international companies in the healthcare, aerospace/defense, industrial goods, oil and gas, and other industries or whether these more traditional FCPA cases will proceed alongside cases in the priority areas.

One thing seems likely: companies that DOJ can tie to cartel or TCO activity, even indirectly, such as financial institutions and payment processors, could face increased FCPA scrutiny.

The dramatic change to the FCPA Unit’s mission may also impact retention of the prosecutors within the Unit, both because prosecutors may choose to leave and because the Unit may not generate the large monetary resolutions necessary to justify current staffing levels within the Unit. Indeed, the Memoranda remove the FCPA Unit’s exclusive jurisdiction to prosecute FCPA offenses in cases involving cartels and TCOs, meaning that U.S. Attorneys' Offices could bring such cases on their own.

Despite these significant changes, companies operating globally should not assume that corruption risk has disappeared. To the contrary, over the past decade in particular, DOJ has partnered with enforcement agencies across the globe to enhance their anti-corruption efforts such that a dip in DOJ enforcement could be filled by more aggressive action internationally. Indeed, many foreign regulators and prosecutors have stepped up anti-corruption enforcement in recent years. And while the Memoranda suggest a curtailing of traditional FCPA Unit enforcement, prior administrations have targeted the FCPA Unit for cuts, only to change their minds before doing so. Companies should continue to ensure that they have strong compliance programs to prevent and detect any bribery or corrupt conduct.

With respect to national security, these measures are notably silent regarding certain areas of corporate enforcement that have long been a focus of the National Security Division and its Corporate Enforcement Unit, such as corporate violations of economic sanctions and export control laws.

With respect to foreign influence, the General Policy Memorandum may mean that criminal prosecution under FARA will subside, at least temporarily, but it also provides for DOJ to continue pursuing FARA violations through the statute’s various civil enforcement mechanisms, including through letters of inquiry and civil litigation. It is also likely that the areas of emphasis may shift geographically, away from Russia and countries in the Gulf to countries that the Trump Administration views as potentially more malign actors, such as China.

These policy shifts also provide a motive for individual states to revisit prior legislative efforts focusing on foreign influence. Nearly a dozen states have previously introduced FARA-like legislation that mimics the federal statute. (These include for example, Arizona House Bill 2506, California Senate Bill 1151, and Georgia Senate Bill 368.) States may potentially revisit the opportunity to fill any perceived void, which could introduce a host of regulatory complications where state attorneys general will be tasked with regulating at the state level what has historically been an exclusive area of federal concern.

Regardless of the changes in the near term, the era of regulating foreign influence is unlikely to permanently subside. Indeed, FARA has consistently been one of the few enforcement areas that has enjoyed bipartisan support. Two of the most outspoken proponents of increasing FARA enforcement are Republican Senator Chuck Grassly and Democratic Senator Gary Peters, who have consistently introduced new legislation to expand lobbying disclosure laws and the government’s enforcement capabilities. And where the statute carries a five-year statute of limitations, companies and individuals would be wise to continue to evaluate their FARA compliance practices as the new enforcement era continues to evolve.

More details on these topics will undoubtedly emerge, and O’Melveny will provide updates as they do.

This memorandum is a summary for general information and discussion only and may be considered an advertisement for certain purposes. It is not a full analysis of the matters presented, may not be relied upon as legal advice, and does not purport to represent the views of our clients or the Firm. Jim Bowman, an O'Melveny partner licensed to practice law in California; Mark A. Racanelli, an O'Melveny partner licensed to practice law in New York; Sharon M. Bunzel, an O’Melveny partner licensed to practice law in California; Rebecca Mermelstein, an O’Melveny partner licensed to practice law in New York and New Jersey; Greta L. Nightingale, an O’Melveny partner licensed to practice law in the District of Columbia; Steven J. Olson, an O'Melveny partner licensed to practice law in California; David J. Ribner, an O’Melveny partner licensed to practice law in the District of Columbia and New York; Benjamin D. Singer, an O'Melveny partner licensed to practice law in the District of Columbia and New York; Pamela A. Miller, an O'Melveny partner licensed to practice law in New York; Jennifer B. Sokoler, an O'Melveny partner licensed to practice law in New York; Meaghan VerGow, an O'Melveny partner licensed to practice law in the District of Columbia and New York; Andrew Churchill, an O’Melveny counsel licensed to practice law in New York; and Jared R. Ginsburg, an O'Melveny counsel licensed to practice law in California, contributed to the content of this newsletter. The views expressed in this newsletter are the views of the authors except as otherwise noted.

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