Introduction

The U.S. Department of Justice (“DOJ”) has announced a significant realignment of resources that will fundamentally reshape criminal enforcement of international trade rules. By combining senior prosecutors from its Market Integrity and Major Frauds Unit (“MIMF”) with attorneys reassigned from the soon-to-be-defunct Consumer Protection Branch, DOJ is forging a newly branded “Market-, Government-, and Consumer-Fraud Unit” with a sharpened mandate: focus on customs fraud and tariff evasion. This initiative—unveiled in speeches, internal memoranda, and follow-on press coverage—signals that trade and customs violations, once largely the province of civil enforcement by U.S. Customs and Border Protection (“CBP”) or DOJ’s Civil Fraud Section, will now also sit squarely on the DOJ’s criminal docket. 

The Nature and Scope of the DOJ’s Organizational Shift

Historically, the Criminal Division’s major frauds docket prioritized procurement fraud, healthcare fraud, and market manipulation. The new blueprint fundamentally changes the structure and mandate of a significant part of the DOJ. Three structural features stand out:

1. Re-tasking Experienced Trial Lawyers. Roughly thirty-five seasoned prosecutors from the MIMF are being re-tasked. These attorneys are accustomed to dissecting multibillion-dollar procurement schemes. Their investigative and litigation skills, and their familiarity with complex accounting issues, instantly deepen the government’s bench strength.
2. Consolidation Into a Larger, Multidisciplinary Team. The Consumer Protection Branch, which historically handled food, drug, and product-safety crimes, is being folded into the same group. That infusion of talent enlarges the new unit to a “significant personnel” footprint and brings subject-matter familiarity with supply-chain investigations, chain-of-custody analysis, and cross-border document tracing.
3. Integration With Existing Civil and Regulatory Assets. Although CBP will remain the primary gatekeeper at ports of entry, DOJ’s restructuring creates a streamlined hand-off mechanism: trade fraud referrals can now be prosecuted criminally without routing cases through multiple divisions. In practical terms, companies that once faced modest duty assessments may now confront grand jury subpoenas, asset-freezes, and the prospect of felony charges under 18 U.S.C. §§ 542, 545, 371 and related statutes.

Taken together, these changes demonstrate that DOJ is not merely “adding” trade to its agenda; it is embedding customs fraud within its white-collar core and equipping that mission with highly experienced personnel and investigative authority.

Expected Changes in Enforcement Dynamics

Reallocation of personnel on this scale carries tangible consequences:

• Acceleration of Investigations. MIMF prosecutors are accustomed to fast-moving financial cases. Their arrival will translate into shorter investigative timelines, aggressive cross-border investigations, and earlier pursuit of indictments naming senior executives.
• Criminalization of Historically Civil Misconduct. Past tariff-evasion cases such as misclassification, undervaluation, or unlawful transshipment often ended in civil settlements. DOJ’s realignment virtually ensures that circumstances involving intentional misconduct will trigger criminal charges.
• National-Security Framing. A May 12, 2025 memorandum from Matthew Galeotti, Head of DOJ’s Criminal Division, explicitly links trade fraud to national security by citing tariff evasion as a threat to American competitiveness and industrial policy. In practice, importers circumventing duties imposed on strategic goods (i.e., steel, semiconductors, electric-vehicle batteries, or dual-use chemicals) should expect heightened prosecutorial interest and probable coordination with the FBI’s counter-intelligence squads.
• Broader Asset-Seizure and Forfeiture Efforts. The Criminal Division has directed attorneys to identify and forfeit assets traceable to customs schemes. Companies may see parallel actions freezing receivables, escrow accounts, or inventory physically present in U.S. warehouses to secure anticipated criminal penalties.

Intersection With the Expanded Whistleblower Program

The DOJ’s Corporate Whistleblower Awards Pilot Program now explicitly lists “trade, tariff, and customs fraud by corporations” as a qualifying category. Two consequences are inevitable:

1. An Influx of High-Quality Tips. Employees in logistics, procurement, brokerage, and finance functions are uniquely positioned to observe inflated rebates, undervalued invoices, or transshipment routes. The promise of a percentage of any forfeiture—sometimes tens of millions of dollars—creates a powerful financial incentive to report.
2. Increased Complexity in Internal Investigations. Where once a company could investigate quietly and then submit a prior disclosure to CBP, executives now face parallel risks: (i) a whistleblower may already have delivered the evidence package to prosecutors; and (ii) any delay in self-reporting forfeits the newly clarified guarantee of a declination afforded by the DOJ’s revised Corporate Enforcement Policy.

Likely Impact on Corporate Enforcement Environment

Combining reallocated prosecutorial muscle with the Whistleblower Awards program will amplify enforcement in several ways:

• Volume of Cases. A surge in criminal filings is expected. Even a small uptick in whistleblower submissions can produce dozens of new investigations; DOJ leadership is expressly directing prosecutors to “move expeditiously.”
• Hybrid Civil-Criminal Resolutions. Companies may confront simultaneous civil False Claims Act suits, administrative penalty cases, and criminal indictments. Such concurrency raises settlement values substantially as civil treble-damage exposure combines with criminal fines and forfeiture.
• Individual Accountability. The May memorandum reiterates that individuals—not merely entities—are the DOJ’s first priority. Customs managers who signed off on product classifications, CFOs who approved falsified valuation schedules, and logistics directors who coordinated transshipment could each face personal jeopardy.
• Shortened Monitorships but Faster Corporate Resolutions. While the DOJ promises to streamline monitorships and cap most at three years, it also expects companies to demonstrate measurable compliance maturity quickly. Early termination opportunities will hinge on demonstrable cultural and operational reforms.

Practical Guidance: Building a Defense-Ready Compliance Posture

To navigate this evolving landscape, general counsel should consider a suite of preventive and remedial measures.

Establish a Robust Import Compliance Program. Documented policies must go beyond tariff-code charts; they should address valuation methodology, preferential duty claims, free-trade-agreement qualification, and transshipment safeguards. A written “reasonable care” matrix—identifying who must review what data before each entry—will be critical evidence should the DOJ scrutinize corporate intent.

Perform Transaction-Testing Audits. Internal auditors should sample past entries and follow CBP’s reconciliation process. Discrepancies between internal cost sheets and customs declarations are red flags. 

Map the Supply Chain End-to-End. Companies must trace manufacturing steps to identify the country of “substantial transformation,” in order to guard against inadvertent transshipment exposure. 

Vet Customs Brokers and Freight Forwarders. Delegation does not transfer liability. Written contracts should impose audit rights, indemnities, and duty-of-care obligations. 

Implement Whistleblower-Friendly Internal Channels. A key way to prevent an external tip is to ensure an internal pathway perceived as fair, confidential, and responsive. Management should track and validate every customs-related complaint. Failure to acknowledge an employee’s reported concern may be portrayed as willful blindness.

Evaluate the Pros and Cons of Voluntary Self-Disclosure. Under the revised enforcement policy, a timely, truthful self-report—with full cooperation and remediation—carries the promise of declination. Counsel should assess each potential violation against the aggravating-circumstances factors: executive involvement, prior misconduct, and actual harm. Where a voluntary disclosure is impractical, companies should still prepare for extensive remediation presentations to receive mitigation credit.

Assess Insurance and Financial Exposure. Trade disruptions can halt imports; criminal forfeiture can seize inventory. Finance teams should model worst-case duty assessments, fines, and product shortages when planning liquidity reserves.

Industries Under Heightened Scrutiny

While any importer can violate customs rules, certain sectors present elevated risk profiles.

High-Tariff Commodities. Steel, aluminum, solar panels, and textiles, among others, all face increased risks.

Consumer Electronics and Components. Complex multi-country assemblies complicate valuation and origin determinations, providing fertile ground for misclassification.

Automotive and Heavy Equipment. The DOJ may focus on “kits” imported for final assembly and on transfer-price valuation between affiliates.

Pharmaceuticals and Medical Devices. Supply chains often span five or more jurisdictions. Robust “Buy American” procurement rules for federal programs intersect with customs duty determinations, creating dual enforcement hooks—tariff evasion and false claims.

E-Commerce and Direct-to-Consumer Retailers. The de minimis exemption on low-value shipments is under legislative scrutiny. Companies that break bulk overseas and drop-ship inexpensive goods risk scrutiny over aggregated under-valuations and country-of-origin misstatements.

Conclusion