On July 10, 2025, officials from the US Department of Justice (DOJ) announced a significant shift in DOJ’s strategy for fraud enforcement, consolidating resources from the Criminal Division and the Civil Division to create a new Market, Government, and Consumer Fraud Unit (MGCF Unit) within the Criminal Division’s Fraud Section. The consolidated MGCF Unit will combine previously disparate enforcement units and focus those resources on investigation and prosecution of trade fraud and tariff evasion, in addition to its historic focus on market manipulation and government procurement fraud.
This reorganization and prioritization of civil and criminal enforcement strategies aligns with the Trump Administration's expanded tariff regime and reflects DOJ’s response to the potential proliferation of illicit schemes designed to evade additional tariffs on imports from China and other countries. Such focus also underscores DOJ’s intent to uphold the integrity of US trade policy and support the growth of US businesses, especially those who have invested in strong trade controls compliance programs.
The Market, Government, and Consumer Fraud Unit
As part of a broader reorganization, DOJ’s Criminal Division Fraud Section’s Market Integrity and Major Frauds Unit (MIMF) is combining with personnel from the DOJ Civil Division’s Consumer Protection Branch – which had both civil and criminal enforcement authority in consumer protection matters – to form the new MGCF Unit with an enhanced mandate that includes pursuing criminal trade fraud and other white-collar crimes affecting investors and consumers.
MIMF, sitting in the Criminal Division, was previously tasked with investigating and prosecuting a range of securities, procurement, consumer, investor, and cryptocurrency-related fraud. The Civil Division’s Consumer Protection Branch led criminal and civil enforcement of laws relating to health, safety, economic security, and identity integrity. Now, the combined resources of the MIMF and a significant portion of Consumer Protection Branch personnel will be transferred to the Criminal Division’s Fraud Section with a new MGCF Unit to address trade-related crimes.
This effort is expected to target companies and individuals engaged in illegal practices such as misclassification, undervaluation of goods, misreporting country of origin, and transshipment – where goods are rerouted and relabeled to disguise their true country of origin and evade tariffs. Investigation and prosecution of such tactics are consistent with DOJ’s White Collar Enforcement Plan announced on May 12, 2025, which identified “trade and customs fraud, including tariff evasion” as one of ten “high-impact areas” prioritized by DOJ, discussed in our previous client alert. DOJ appears particularly focused on cases involving long-running fraudulent conduct, senior executives, and significant financial losses to the US government.
Enforcement tools and challenges
The escalation of tariffs – currently exceeding 50 percent on certain Chinese imports, with new duties announced on goods transshipped through countries such as Vietnam – has increased both financial incentives for evasion and potential losses to the US government. DOJ is expected to leverage specific criminal provisions for trade fraud and is encouraging voluntary disclosures through a new policy that offers enhanced benefits for companies that self-report wrongdoing. As discussed in our prior client alert, DOJ is also leveraging the False Claims Act (FCA) to enforce tariff compliance, as shown by the April 18, 2025 complaint filed by DOJ against Barco Uniforms Inc. alleging FCA violations related to failure to pay customs duties on apparel imported from China.
The Department reportedly has already received whistleblower tips and voluntary disclosures related to trade fraud, signaling increased engagement from the private sector. Given the sizeable financial benefits to whistleblowers, DOJ may need to carefully vet the information they receive to ensure its credibility. The Criminal Division’s Whistleblower initiative, established in August 2024 and expanded in May 2025 to include tips on “[v]iolations by or through companies related to trade, tariff, and customs fraud,” appears to have sufficient staff and resources to field and evaluate an anticipated increase in referrals.
DOJ’s renewed focus builds on the work of a trade fraud task force established during the first Trump Administration, which had initiated over 70 investigations in coordination with customs officials. The current approach aims to streamline investigations and strengthen interagency partnerships. In particular, DOJ’s efforts are complemented by US Customs and Border Protection, which plays a frontline role in reviewing imports at US ports. In addition, the new MGCF Unit will likely employ sophisticated data analytics that have been implemented by DOJ’s Fraud Section across numerous other enforcement areas, including in identifying and prosecuting healthcare fraud. Specifically, the new MGCF Unit will likely a) partner with investigators from the Commerce Department to review and analyze the Census Bureau’s Automated Export System (AES) data to identify red flags such as changes in value, quantity, country of origin, and harmonized tariff schedule (HTS) codes, among others; b) gather and compare import/export data from trade partner countries, particularly Mexico and Canada; and c) use ship tracking data (eg, Automatic Identification System, or AIS) to identify behavior consistent with diversion or high-risk or surreptitious ship-to-ship transfers. DOJ’s push to prosecute criminal trade fraud violations will also likely work in parallel to the DOJ Civil Division’s National Courts Section, which handles civil matters involving international trade and tariff violations.
At the same time, however, DOJ’s enforcement efforts could face significant challenges when pursuing foreign companies, including those based in China, given the lack of cooperation among different jurisdictions. As a result, DOJ may increasingly focus on US-based individuals or entities that facilitate or collude in evasion schemes, leveraging data analytics to identify not only willful criminal conduct, but also civil or administrative violations.
Implications for companies
DOJ’s prioritization of trade fraud enforcement could lead to increased scrutiny of importers, exporters, and supply chain participants. There may also be a rise in civil investigative demands and criminal investigations, particularly where there are indicia of deliberate evasion or collusion. DOJ is likely to rely on data analytics to identify and pursue high-profile prosecutions to deter unlawful conduct and reinforce compliance expectations.
Given the complexity of tariff regulations and the evolving enforcement landscape, companies engaged in international trade are encouraged to take the following steps:
- Review their compliance programs to evaluate potential gaps in classification, valuation, country of origin, and potential transshipment.
- Enhance due diligence on supply chains. This may be especially true for new suppliers in jurisdictions with lower tariffs or less stringent regulatory oversight.
- Consider whether a limited audit is appropriate to evaluate the implementation of the trade controls compliance program.
- Ensure all whistleblower and hotline complaints are evaluated quickly and investigated thoroughly (under privilege).
- For maritime shipments, consider whether monitoring of ships through a transaction lifecycle is warranted to detect irregularities consistent with tariff (and sanctions) evasion.
- If suspected violations have occurred, carefully examine the potential benefits and risks of voluntary disclosure to authorities, especially if others in the industry are similarly situated.
Conclusion
The DOJ’s reallocation of resources to combat trade fraud and tariff evasion marks a significant development in the enforcement of US trade policy under the Trump Administration. While the legal framework for investigation and prosecution remains unchanged, the increased focus and expanded personnel signal heightened enforcement risk for companies involved in cross-border trade. Businesses are encouraged to assess their risk exposure and ensure robust compliance measures are in place to navigate the evolving regulatory environment.
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