US DOJ Ups Ante in War on White Collar Crime: Impact on Indian Exporters
The US Department of Justice’s (DOJ) criminal head recently released a paper named ‘Focus, Fairness, and Efficiency in the War on White Collar Crime’, laying down the present administration’s approach to economic crimes and revised corporative regulations. The paper underlines the government’s aggressive approach in combatting all forms of trade fraud. Given the large scale of exports from India to the US, this change in policy can have direct ramifications for Indian exporters. There is a paradigm shift in the landscape of global trade compliance since the creation of the Market, Government, and Consumer Fraud (MGCF) Unit by the DOJ, aiming to bring sharp focus on tariff evasion investigations and prosecutions.
The enforcement of the False Claims Act (FCA) has been broadened to chase trade offences, coupled with the inauguration of a specialized Trade Fraud Task Force (Task Force) in August 2025. They have also taken an innovative step by enticing whistleblowers with monetary rewards. A new Whistleblower Awards Pilot Program has been introduced where a whistleblower is rewarded financially if their tips lead to seizure amounting to $1 million or more. This could potentially trigger an immense motivation amongst employees and rivals to alert authorities regarding questionable activities.
One can easily comprehend the implications of these policy changes on Indian exporters through certain instances. For instance, in 2013, Ranbaxy USA – a branch of India-based Ranbaxy Laboratories Ltd – confessed to felony charges related to manufacturing and distribution of certain contaminated drugs, which were originally produced at their Indian premises and sold in the US. Despite knowing about the contamination, they proceeded to give false statements and were eventually prosecuted.
In one of the recent actions, DRI Relays Inc., an offshoot of TE Connectivity Corporation, faced charges of infringing the FCA while supplying military parts, mainly electrical relays and sockets, to the US Department of Defence. These were produced at their sites located in Long Island, New York, and Bengaluru, India. All of these cases underscore how seriously the US is implementing its trade policies and the potential impact on the Indian exporting industry.
Companies are currently under stringent examination across sectors, with agencies demanding absolute perfection in documentation and transparency in day-to-day operations. Three crucial data points need to be reported accurately by Indian exporters: tariff classification, the origin of the product, and product valuation. A misstep in these areas could lead to tariffs being underpaid and triggering enforcement responses.
As tariff regulations undergo constant changes, maintaining compliance has become a prime necessity yet highly challenging. Take a hypothetical scenario of a regular Indian manufacturer sourcing components from China, processing them in multiple Indian states, and exporting the finished goods to the US. Under the current enforcement climate, every stage of this process requires meticulous documentation.
Incomplete or inaccurate paperwork will no longer be tolerated. There exists a significant risk of barred access to US markets if companies do not implement robust compliance systems. Companies must brace themselves with documentation that can survive rigorous interrogation by determined investigators. These changes point towards a shift from reactive to proactive enforcement of rules by the US authorities.
The US is proactively hunting for trade violations instead of merely responding to complaints. This aggressive approach also brings along opportunities for Indian exporters who follow all regulations strictly. Enterprises that have been engaging in ambiguous tariff strategies are now faced with higher compliance costs and regulatory scrutiny.
This scenario balances the competition for exporters who are ready to invest in vigorous compliance systems and transparent operations. This necessitates companies to immediately augment their compliance programs in order to sustain market access and avoid scrutiny that may potentially turn out to be considerably expensive for companies.