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Soon after taking office this summer, Tom Wheeler, the newly installed U.S. Attorney for the Southern District of Indiana, announced that he intends to focus on “cracking down on government procurement fraud” during his tenure as the district’s top federal law enforcement officer.
Wheeler is not alone in this objective. Under the Trump administration, the Department of Justice has aggressively expanded its efforts to combat deceptive conduct in the procurement of goods and services by federal agencies. And given the federal government’s unique presence in Indiana, there may be a significant uptick in fraud enforcement against government contractors in the Hoosier State.
The False Claims Act, 31 U.S.C. §§ 3729 et seq., is the federal government’s primary civil enforcement tool for addressing procurement fraud. The FCA provides that a person who knowingly submits, or causes to submit, a false or fraudulent claim for payment to the federal government can be held liable for three times the government’s damages, along with statutory penalties.
Liability can also arise where a person improperly avoids an obligation to pay the government or where parties conspire to commit fraud in connection with a government contract. Common procurement fraud schemes include overbilling, charging for unnecessary services, delivering defective or substandard goods, falsifying qualifications or information in bids, and paying bribes or kickbacks to secure contracts.
Procurement fraud can also trigger criminal liability. Recently, a federal grand jury in Colorado returned an indictment charging two Denver companies and their top executives with wire fraud, false statements, and conspiracy in connection with the sale of forklifts to the federal government. (See Indictment, United States of America v. Endless Sales, Inc., et al., No. 1:25-cr-00251-DDD (D. Colo. Aug. 21, 2025), ECF No. 1.)
Prosecutors allege that these defendants imported forklifts that were manufactured in China, falsified the products’ Chinese origin, and then resold them to governmental agencies with the representation that the forklifts were “Made in America.”
This indictment was the product of the Justice Department’s Procurement Collusion Strike Force (PCSF), a joint law enforcement taskforce that includes criminal investigators from the Department of Defense, Department of Homeland Security, DOJ Antitrust Division, and other agencies. The PCSF focuses on fraud impacting procurement, grant, and federal program funding.
The federal government’s footprint in Indiana could make the state ripe for enforcement activity.
The Defense Finance and Accounting Service, a component agency of the Department of Defense, maintains its national headquarters on the northeast side of Indianapolis. DFAS serves as the main payment hub for defense contractors, servicemembers, and federal employees. In 2024 alone, DFAS paid more than 13,000,000 commercial invoices, disbursed over $600 billion in government funds, and managed trillions of dollars in military retirement and health benefits.
DFAS’s hub in Indianapolis may prove significant as the DOJ continues its efforts to combat procurement fraud. The FCA contains an expansive venue provision that authorizes the government to commence suit in any judicial district where a defendant “transact[ed] business.” 31 U.S.C. § 3732(a). Venue is also proper in any district where a defendant presented or caused a false claim to be presented for payment. Id. §§ 3729 & 2732.
Congress specifically designed these provisions to operate as a “form of long-arm statute” that allows for “effective litigation by the Government[.]” S. Rep. No. 99-345, at 32 (1986), reprinted in 1986 U.S.C.C.A.N. 5266, 5297. Thus, where the federal government made payment on an allegedly fraudulent claim and where that payment flowed through DFAS’s operations in Indianapolis, the DOJ may conclude that the Southern District of Indiana is the natural venue for the enforcement action.
More federal presence is on the way for Indiana, too. Earlier this year, the U.S. Department of Agriculture announced that it selected Indianapolis as one of five central hubs, with plans to relocate operations and staff to Indiana. See “Department of Agriculture Reorganization Plan,” Secretary of Agriculture Memorandum SM 1078-015 (July 24, 2025).
This reorganization will bring an influx of more USDA operations—and, with it, more contracting work—to the state. And Indiana already is home to several large-scale federal operations, such as the Naval Surface Warfare Center (NSWC) in Crane, Indiana, which may generate other fraud enforcement actions.
The DOJ’s increased focus on procurement fraud underscores the likelihood of heightened scrutiny for government contractors with a link to Indiana. With the expansion of federal activities and enforcement mechanisms, businesses contracting with the government should anticipate greater oversight and proactively enhance their compliance programs to mitigate risks in this evolving regulatory landscape.•
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Taylor Kirklin is of counsel at Barnes & Thornburg LLP. Opinions expressed are those of the author.
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