The U.S. Department of Justice (DOJ) has launched a new whistleblower incentive program designed to accelerate fraud investigations by offering cash awards of $10,000 to $30,000 for tips that lead to criminal charges. Announced on October 20, 2026, the Fraud Whistleblower Incentive Program (WHIP) departs from traditional whistleblower programs by providing awards when criminal charges are filed, rather than waiting for the final resolution of a case. The Program targets federal health care offenses, related crimes, and fraud involving government programs and benefits administered by eight federal agencies.
The new Program reinforces DOJ’s emphasis on health care fraud enforcement. It follows the National Fraud Enforcement Division’s recent directive identifying health care fraud as its top enforcement priority, as well as a joint voluntary self-disclosure policy with the Department of Health and Human Services Office of Inspector General (HHS-OIG). Together, these initiatives suggest a coordinated approach to investigating and prosecuting fraud involving federal health care programs.
By rewarding whistleblowers at an earlier stage of criminal proceedings, DOJ is creating greater incentives for individuals to report suspected misconduct directly to the federal government. Click here to read the full post.
http://whitecollarwatch.sidley.com/wp-content/uploads/sites/8/2026/03/sidleyLogo-e1643922598198.png00Lisa H. Millerhttp://whitecollarwatch.sidley.com/wp-content/uploads/sites/8/2026/03/sidleyLogo-e1643922598198.pngLisa H. Miller2026-10-23 15:18:232026-10-23 15:19:13DOJ’s Fraud Division Launches Fast-Track Whistleblower Awards, With a Focus on Health Care Fraud
On October 22, 2026, the Department of Justice (“DOJ”) Civil Division and the Department of Health and Human Services (“HHS”) announced a six-month Healthcare False Claims Act Self-Disclosure Pilot Program (“FCA SDPP”). The program offers healthcare companies a defined path to resolve potential FCA violations the government does not yet know about, in exchange for a “coordinated civil release” and a repayment within a set multiplier range. DOJ says the goal is to free up government resources to focus on “recalcitrant actors.”
https://whitecollarwatch.sidley.com/wp-content/uploads/sites/8/2026/06/AdobeStock_1494587598.jpeg606833Kristin Graham Koehlerhttp://whitecollarwatch.sidley.com/wp-content/uploads/sites/8/2026/03/sidleyLogo-e1643922598198.pngKristin Graham Koehler2026-10-22 17:31:532026-10-22 17:31:53DOJ and HHS Launch Healthcare FCA Self-Disclosure Pilot Program with Fixed Repayment Multiplier
On October 15, 2026, the Department of Justice’s National Fraud Enforcement Division (“NFED”) and the Department of Health and Human Services Office of Inspector General (“HHS-OIG”) announced a joint policy (the “Policy”) directing companies seeking to self-disclose potential criminal healthcare matters to NFED’s Health Care Fraud Section. The Policy promises companies deemed to have made good faith, voluntary self-disclosures credit under both DOJ’s Corporate Enforcement and Voluntary Self-Disclosure Policy (CEP) and HHS-OIG’s Self-Disclosure Protocol. It arrives two weeks after the Fraud Division issued Directive 26-12, Corporate Enforcement in the Fight Against Fraud (the “Directive”), in which NFED identified healthcare fraud as its top priority. You can read more about the Directive here.
The U.S. Department of Justice’s (DOJ) National Fraud Enforcement Division has issued a new directive calling for more aggressive fraud investigations and prosecutions, including broader charging strategies, earlier asset seizures, and increased use of cooperating witnesses. Released on October 8, 2026, Directive 26-13 builds on the Division’s recently announced enforcement priorities and provides prosecutors with specific instructions for pursuing fraud cases.
The Directive instructs prosecutors to consider tax, securities, and consumer fraud charges alongside traditional fraud offenses, while emphasizing the use of asset freezes, forfeiture proceedings, and other measures to disrupt suspected misconduct before criminal charges are filed. It also encourages proactive investigations through data analysis, cooperating insiders, and undercover operations, and directs prosecutors to seek stronger sentences where warranted.
Although the Directive does not create new criminal offenses or expand DOJ’s existing authority, it signals a more coordinated and aggressive approach to fraud enforcement. Companies operating in priority sectors, including health care, government contracting, and trade, should assess potential exposure across multiple legal regimes, prepare for enforcement actions that could disrupt operations before indictment, and evaluate credible allegations promptly, particularly where voluntary self-disclosure may be an option. Click here for the full post.
https://whitecollarwatch.sidley.com/wp-content/uploads/sites/8/2026/06/AdobeStock_330226534.jpeg606833Kenneth A. Polite Jr.http://whitecollarwatch.sidley.com/wp-content/uploads/sites/8/2026/03/sidleyLogo-e1643922598198.pngKenneth A. Polite Jr.2026-10-16 09:04:252026-10-16 10:24:34DOJ’s Fraud Division Directs Broader Charging Strategies and Earlier Asset Seizures in New Memorandum
On October 9, 2026, the U.S. Department of the Treasury’s Office of Foreign Assets Control (OFAC) announced a $175,015 settlement with California-based freight forwarder Pegasus Worldwide Logistics (Pegasus) for apparent violations of U.S. counter-narcotics sanctions and OFAC reporting requirements. The enforcement action arose from Pegasus’s involvement in shipping a $5,950 machine supplied by a sanctioned Chinese company that had changed its name following its designation. Despite the relatively modest transaction value, OFAC imposed a substantial penalty, citing deficiencies in Pegasus’s sanctions screening, failure to investigate red flags, and incomplete response to an administrative subpoena.
OFAC found that Pegasus failed to conduct sanctions screening at the outset of the transaction and subsequently screened only the supplier’s new name, overlooking email and telephone information that would have identified the company as a sanctioned party. Pegasus also continued processing payments after receiving a U.S. Customs and Border Protection detention notice referencing OFAC. Compounding these failures, Pegasus initially certified that it had no documents responsive to an OFAC subpoena, only to produce responsive records months later. OFAC treated the incomplete response as a separate basis for liability and an aggravating factor in calculating the settlement.
The action underscores OFAC’s heightened compliance expectations for logistics companies and other intermediaries, regardless of their size or the value of the underlying transaction. It also highlights the importance of screening all available identifying information before engaging in transactions, promptly escalating sanctions-related red flags, and ensuring complete and accurate responses to government inquiries. OFAC further emphasized the availability of financial incentives for sanctions whistleblowers, reinforcing the importance of effective internal reporting and escalation procedures. Click here for the full post.
The Hong Kong Securities and Futures Commission (SFC) has reprimanded Zheng Da International Financial Holding Limited and imposed a HK$7 million fine for failures involving anti-money laundering (AML) controls, client due diligence, and trading surveillance. The SFC also suspended one of the firm’s responsible officers for seven months, underscoring its continued focus on compliance controls and senior management accountability.
The SFC found that Zheng Da failed to conduct adequate due diligence on customer-supplied trading systems used to execute more than 10 million futures trades, investigate substantial client deposits inconsistent with customers’ financial profiles, and detect potentially suspicious trading activity. The firm had also disabled a trading surveillance function because it interfered with normal client trading. The SFC further found that Zheng Da could not produce contemporaneous records supporting its claims that certain compliance checks had been performed.
The action reinforces several recurring SFC enforcement themes: compliance policies must be effectively implemented, firms must maintain records demonstrating adherence to those policies, and reliance on third-party technology providers does not relieve intermediaries of their regulatory obligations. Notably, the SFC treated Zheng Da’s failure to respond to earlier enforcement actions involving similar misconduct as an aggravating factor, highlighting the importance of monitoring regulatory developments and assessing their implications for existing compliance programs. Click here to read the full post.
https://whitecollarwatch.sidley.com/wp-content/uploads/sites/8/2026/04/GettyImages-1080626808.jpg400600James Comberhttp://whitecollarwatch.sidley.com/wp-content/uploads/sites/8/2026/03/sidleyLogo-e1643922598198.pngJames Comber2026-10-13 12:25:482026-10-15 15:11:16SFC Enforcement Reinforces Approach To Due Diligence on Third-Party Systems, Client Transaction Monitoring, AML Liability
Sidley has been named a finalist for the “Most Impressive Global Investigations Practice of the Year” at the Global Investigations Review (GIR) Awards 2026 — one of the most prestigious honors in the global investigations and white collar defense community. The annual awards recognize firms that have demonstrated exceptional skill in navigating high-profile and complex investigations over the past year.
http://whitecollarwatch.sidley.com/wp-content/uploads/sites/8/2026/03/sidleyLogo-e1643922598198.png00White Collar Watchhttp://whitecollarwatch.sidley.com/wp-content/uploads/sites/8/2026/03/sidleyLogo-e1643922598198.pngWhite Collar Watch2026-10-09 11:04:572026-10-09 11:04:57Sidley Named a Finalist for “Most Impressive Global Investigations Practice of the Year” at the 2026 GIR Awards
On October 1, 2026, the SEC’s Division of Examinations published a new SEC Exam Handbook: A Practical Guide on Process and Engagement, replacing the brochure that has long accompanied examination notices. Although the Handbook largely memorializes existing practice, it provides new detail on how examinations are opened, conducted, and closed—and on the circumstances in which examination findings may lead to enforcement scrutiny.
Among other things, the Handbook confirms that examination staff may refer issues to the SEC’s Division of Enforcement, other regulators, or criminal authorities, and in some circumstances may do so before an exit conference or deficiency letter. It also emphasizes that prompt remediation may mitigate whether a finding is referred to Enforcement, while encouraging registrants to address misunderstandings and compliance concerns with examination staff as they arise.
The Handbook does not announce a new enforcement policy, but it puts in writing several features of the examination process that can matter when an exam begins to take on an enforcement dimension. For registrants, the publication offers a useful roadmap for managing that risk—from responding to information requests and preserving privilege to addressing potential deficiencies before they become referral issues. Click here to read the full post.
https://whitecollarwatch.sidley.com/wp-content/uploads/sites/8/2026/02/GettyImages-1307247030.jpg400600Victoria A. Anglinhttp://whitecollarwatch.sidley.com/wp-content/uploads/sites/8/2026/03/sidleyLogo-e1643922598198.pngVictoria A. Anglin2026-10-07 10:07:042026-10-07 10:07:28SEC Division of Examinations Issues Exam Handbook
DOJ’s Fraud Division Launches Fast-Track Whistleblower Awards, With a Focus on Health Care Fraud
The U.S. Department of Justice (DOJ) has launched a new whistleblower incentive program designed to accelerate fraud investigations by offering cash awards of $10,000 to $30,000 for tips that lead to criminal charges. Announced on October 20, 2026, the Fraud Whistleblower Incentive Program (WHIP) departs from traditional whistleblower programs by providing awards when criminal charges are filed, rather than waiting for the final resolution of a case. The Program targets federal health care offenses, related crimes, and fraud involving government programs and benefits administered by eight federal agencies.
The new Program reinforces DOJ’s emphasis on health care fraud enforcement. It follows the National Fraud Enforcement Division’s recent directive identifying health care fraud as its top enforcement priority, as well as a joint voluntary self-disclosure policy with the Department of Health and Human Services Office of Inspector General (HHS-OIG). Together, these initiatives suggest a coordinated approach to investigating and prosecuting fraud involving federal health care programs.
By rewarding whistleblowers at an earlier stage of criminal proceedings, DOJ is creating greater incentives for individuals to report suspected misconduct directly to the federal government. Click here to read the full post.
Lisa H. Miller
Washington, D.C.
lisa.miller@sidley.com
Jaime L.M. Jones
Chicago
jaime.jones@sidley.com
Kenneth G. Coffin
Dallas
kenneth.coffin@sidley.com
Michael D. Mann
New York
mdmann@sidley.com
Brian C. Earl
New York
bearl@sidley.com
Asher J. Zlotnik
New York
asher.zlotnik@sidley.com
DOJ and HHS Launch Healthcare FCA Self-Disclosure Pilot Program with Fixed Repayment Multiplier
On October 22, 2026, the Department of Justice (“DOJ”) Civil Division and the Department of Health and Human Services (“HHS”) announced a six-month Healthcare False Claims Act Self-Disclosure Pilot Program (“FCA SDPP”). The program offers healthcare companies a defined path to resolve potential FCA violations the government does not yet know about, in exchange for a “coordinated civil release” and a repayment within a set multiplier range. DOJ says the goal is to free up government resources to focus on “recalcitrant actors.”
(more…)
Kristin Graham Koehler
Washington, D.C.
kkoehler@sidley.com
Jaime L.M. Jones
Chicago
jaime.jones@sidley.com
Lisa H. Miller
Washington, D.C.
lisa.miller@sidley.com
Kenneth G. Coffin
Dallas
kenneth.coffin@sidley.com
Matt Bergs
Chicago
mbergs@sidley.com
DOJ Fraud Division and HHS-OIG Announce Joint Self-Disclosure Policy, Directing Healthcare Companies to Bring Potential Criminal Matters to DOJ First
On October 15, 2026, the Department of Justice’s National Fraud Enforcement Division (“NFED”) and the Department of Health and Human Services Office of Inspector General (“HHS-OIG”) announced a joint policy (the “Policy”) directing companies seeking to self-disclose potential criminal healthcare matters to NFED’s Health Care Fraud Section. The Policy promises companies deemed to have made good faith, voluntary self-disclosures credit under both DOJ’s Corporate Enforcement and Voluntary Self-Disclosure Policy (CEP) and HHS-OIG’s Self-Disclosure Protocol. It arrives two weeks after the Fraud Division issued Directive 26-12, Corporate Enforcement in the Fight Against Fraud (the “Directive”), in which NFED identified healthcare fraud as its top priority. You can read more about the Directive here.
(more…)
Jaime L.M. Jones
Chicago
jaime.jones@sidley.com
Kristin Graham Koehler
Washington, D.C.
kkoehler@sidley.com
Lisa H. Miller
Washington, D.C.
lisa.miller@sidley.com
Matt Bergs
Chicago
mbergs@sidley.com
Lauren E. McBride
Chicago
lmcbride@sidley.com
Anna M. Schmitt
Chicago
anna.schmitt@sidley.com
DOJ’s Fraud Division Directs Broader Charging Strategies and Earlier Asset Seizures in New Memorandum
The U.S. Department of Justice’s (DOJ) National Fraud Enforcement Division has issued a new directive calling for more aggressive fraud investigations and prosecutions, including broader charging strategies, earlier asset seizures, and increased use of cooperating witnesses. Released on October 8, 2026, Directive 26-13 builds on the Division’s recently announced enforcement priorities and provides prosecutors with specific instructions for pursuing fraud cases.
The Directive instructs prosecutors to consider tax, securities, and consumer fraud charges alongside traditional fraud offenses, while emphasizing the use of asset freezes, forfeiture proceedings, and other measures to disrupt suspected misconduct before criminal charges are filed. It also encourages proactive investigations through data analysis, cooperating insiders, and undercover operations, and directs prosecutors to seek stronger sentences where warranted.
Although the Directive does not create new criminal offenses or expand DOJ’s existing authority, it signals a more coordinated and aggressive approach to fraud enforcement. Companies operating in priority sectors, including health care, government contracting, and trade, should assess potential exposure across multiple legal regimes, prepare for enforcement actions that could disrupt operations before indictment, and evaluate credible allegations promptly, particularly where voluntary self-disclosure may be an option. Click here for the full post.
Kenneth A. Polite Jr.
Washington, D.C., New York
kpolite@sidley.com
Lisa H. Miller
Washington, D.C.
lisa.miller@sidley.com
Michael D. Mann
New York
mdmann@sidley.com
Kenneth G. Coffin
Dallas
kenneth.coffin@sidley.com
Brian C. Earl
New York
bearl@sidley.com
Kedrick Glinski
New York
kedrick.glinski@sidley.com
Asher J. Zlotnik
New York
asher.zlotnik@sidley.com
OFAC’s Pegasus Settlement: Lessons for Logistics Providers on Screening and Subpoena Responses
On October 9, 2026, the U.S. Department of the Treasury’s Office of Foreign Assets Control (OFAC) announced a $175,015 settlement with California-based freight forwarder Pegasus Worldwide Logistics (Pegasus) for apparent violations of U.S. counter-narcotics sanctions and OFAC reporting requirements. The enforcement action arose from Pegasus’s involvement in shipping a $5,950 machine supplied by a sanctioned Chinese company that had changed its name following its designation. Despite the relatively modest transaction value, OFAC imposed a substantial penalty, citing deficiencies in Pegasus’s sanctions screening, failure to investigate red flags, and incomplete response to an administrative subpoena.
OFAC found that Pegasus failed to conduct sanctions screening at the outset of the transaction and subsequently screened only the supplier’s new name, overlooking email and telephone information that would have identified the company as a sanctioned party. Pegasus also continued processing payments after receiving a U.S. Customs and Border Protection detention notice referencing OFAC. Compounding these failures, Pegasus initially certified that it had no documents responsive to an OFAC subpoena, only to produce responsive records months later. OFAC treated the incomplete response as a separate basis for liability and an aggravating factor in calculating the settlement.
The action underscores OFAC’s heightened compliance expectations for logistics companies and other intermediaries, regardless of their size or the value of the underlying transaction. It also highlights the importance of screening all available identifying information before engaging in transactions, promptly escalating sanctions-related red flags, and ensuring complete and accurate responses to government inquiries. OFAC further emphasized the availability of financial incentives for sanctions whistleblowers, reinforcing the importance of effective internal reporting and escalation procedures. Click here for the full post.
Maura Rezendes
Washington, D.C.
maura.rezendes@sidley.com
Jen Fernandez
Washington, D.C.
jen.fernandez@sidley.com
Andrew W. Shoyer
Washington, D.C.
ashoyer@sidley.com
Michael D. Mann
New York
mdmann@sidley.com
James Daher
Washington, D.C.
james.daher@sidley.com
Mine Orer
Washington, D.C.
morer@sidley.com
Lloyd Lyall
Washington, D.C.
lloyd.lyall@sidley.com
Brian C. Earl
New York
bearl@sidley.com
Asher J. Zlotnik
New York
asher.zlotnik@sidley.com
SFC Enforcement Reinforces Approach To Due Diligence on Third-Party Systems, Client Transaction Monitoring, AML Liability
The Hong Kong Securities and Futures Commission (SFC) has reprimanded Zheng Da International Financial Holding Limited and imposed a HK$7 million fine for failures involving anti-money laundering (AML) controls, client due diligence, and trading surveillance. The SFC also suspended one of the firm’s responsible officers for seven months, underscoring its continued focus on compliance controls and senior management accountability.
The SFC found that Zheng Da failed to conduct adequate due diligence on customer-supplied trading systems used to execute more than 10 million futures trades, investigate substantial client deposits inconsistent with customers’ financial profiles, and detect potentially suspicious trading activity. The firm had also disabled a trading surveillance function because it interfered with normal client trading. The SFC further found that Zheng Da could not produce contemporaneous records supporting its claims that certain compliance checks had been performed.
The action reinforces several recurring SFC enforcement themes: compliance policies must be effectively implemented, firms must maintain records demonstrating adherence to those policies, and reliance on third-party technology providers does not relieve intermediaries of their regulatory obligations. Notably, the SFC treated Zheng Da’s failure to respond to earlier enforcement actions involving similar misconduct as an aggravating factor, highlighting the importance of monitoring regulatory developments and assessing their implications for existing compliance programs. Click here to read the full post.
James Comber
Hong Kong
james.comber@sidley.com
Dominic James
Hong Kong
dominic.james@sidley.com
David Kalani Lee
Hong Kong
david.lee@sidley.com
Jenny Liu
Hong Kong
jenny.liu@sidley.com
Sidley Named a Finalist for “Most Impressive Global Investigations Practice of the Year” at the 2026 GIR Awards
Sidley has been named a finalist for the “Most Impressive Global Investigations Practice of the Year” at the Global Investigations Review (GIR) Awards 2026 — one of the most prestigious honors in the global investigations and white collar defense community. The annual awards recognize firms that have demonstrated exceptional skill in navigating high-profile and complex investigations over the past year.
(more…)
White Collar Watch
SEC Division of Examinations Issues Exam Handbook
On October 1, 2026, the SEC’s Division of Examinations published a new SEC Exam Handbook: A Practical Guide on Process and Engagement, replacing the brochure that has long accompanied examination notices. Although the Handbook largely memorializes existing practice, it provides new detail on how examinations are opened, conducted, and closed—and on the circumstances in which examination findings may lead to enforcement scrutiny.
Among other things, the Handbook confirms that examination staff may refer issues to the SEC’s Division of Enforcement, other regulators, or criminal authorities, and in some circumstances may do so before an exit conference or deficiency letter. It also emphasizes that prompt remediation may mitigate whether a finding is referred to Enforcement, while encouraging registrants to address misunderstandings and compliance concerns with examination staff as they arise.
The Handbook does not announce a new enforcement policy, but it puts in writing several features of the examination process that can matter when an exam begins to take on an enforcement dimension. For registrants, the publication offers a useful roadmap for managing that risk—from responding to information requests and preserving privilege to addressing potential deficiencies before they become referral issues. Click here to read the full post.
Victoria A. Anglin
Los Angeles
vanglin@sidley.com
Chuck Daly
New York, Boston
cdaly@sidley.com
Ranah Esmaili
Washington, D.C., New York
resmaili@sidley.com
Marissa L. Henry
Boston
marissa.henry@sidley.com
Lara Mehraban
New York
lmehraban@sidley.com
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