DOJ Fraud Division directive calls for early asset seizures and multi-angle fraud cases
The US Justice Department's National Fraud Enforcement Division issued Directive 26-13, setting out how its prosecutors should investigate, disrupt and prosecute fraud. It stresses early asset seizures and takedowns of the digital tools behind schemes.
On October 8, 2026, Assistant Attorney General Colin M. McDonald of the Justice Department's National Fraud Enforcement Division (the Fraud Division) released Directive 26-13. The directive sets out the Division's method for investigating, disrupting and prosecuting fraud. It builds on earlier guidance on the Division's priorities and its corporate enforcement policy.
According to the DOJ, the directive requires prosecutors to pursue fraud from every angle, using the Division's tax, securities fraud, consumer fraud and cybercrime authorities. The DOJ describes this as a major operational shift.
Prosecutors must also use early, pre-indictment asset seizures and takedowns of digital infrastructure to stop schemes and freeze assets quickly. A pre-indictment seizure means taking control of assets before formal charges are filed. The directive also urges prosecutors to develop cooperating witnesses, pursue corporate wrongdoers aggressively, seek arrest and detention where appropriate, and advocate fully at sentencing.
The DOJ release cites a Government Accountability Office (GAO) estimate that the federal government loses between $233 billion and $521 billion a year to fraud.
Why it matters to AML professionals
Early asset seizures depend on fast, clear information about where fraud proceeds sit, and much of that comes from bank records and suspicious activity reports. Well-written SARs that trace funds and name accounts can help law enforcement act before money moves on. AML professionals may also see more seizure warrants, subpoenas and requests tied to fraud cases.
Red flags in this case
- Large incoming payments followed quickly by transfers to several unrelated accounts or overseas
- Newly opened business accounts receiving high volumes of funds inconsistent with the stated business
- Funds moved from fiat accounts into crypto soon after receipt
- Customer activity linked to websites, domains or online platforms named in fraud alerts
If this landed in your queue
- Trace the flow of funds in and out of the account and identify where the money currently sits
- Document the destination accounts, wallets and counterparties clearly so the SAR narrative can support fast action
- Check for any open subpoenas, seizure warrants or law enforcement requests linked to the customer
- Escalate promptly when funds are still in the account and appear to be fraud proceeds, following internal procedures for law enforcement contact
Key terms
- Pre-indictment asset seizure
- Law enforcement taking control of suspected criminal assets before formal charges are filed, to stop them from being moved or spent.
- Cooperating witness
- A person involved in or aware of a crime who agrees to help prosecutors, often in exchange for leniency.
- Digital infrastructure takedown
- Shutting down the websites, domains, servers or online tools used to run a scheme.
Interview angle
How can a well-written SAR help law enforcement recover fraud proceeds?
A strong candidate explains that a clear narrative with traced fund flows, account numbers and timelines lets investigators find and freeze money quickly, and mentions timely filing.
Sources
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