DOJ Probes Corporate DEI

Benzinga

The Trump administration is using the False Claims Act to probe DEI practices at major federal contractors, including Alphabet’s Google and Verizon Communications, an unusual legal approach that could trigger significant penalties.

Transcript

00:00It's Benzinga, bringing Wall Street to Main Street.

00:03The Trump administration has launched investigations into diversity initiatives

00:06at major U.S. companies by applying a federal anti-fraud law, according to the Wall Street

00:12Journal. The civil probes are being conducted under the False Claims Act, a law traditionally

00:18used to pursue contractors who overbill the government or charge for work not performed.

00:24The Justice Department argues that companies with federal contracts commit fraud if they

00:28continue considering diversity in hiring, allowing the government to seek recovery of potentially

00:33millions of dollars. The probes were ordered under a May enforcement memo from Deputy Attorney

00:39General Todd Blanche after Trump issued an executive order targeting DEI policies and government

00:44work. Companies receiving document demands include Alphabet's Google and Verizon Communications.

00:51Legal experts said the approach is unusual and could face challenges in court, though potential

00:55penalties include triple damages. For all things money, visit Benzinga.com.

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