On February 5, 2025, President Trump's nominee to lead the Justice Department (the "Department"), Pamela Bondi, was confirmed by the Senate to serve as the U.S. Attorney General. Bondi immediately took action to reshape the Department's national security priorities by implementing changes to the National Security Division, including by disbanding its Corporate Enforcement Unit, suspending certain approval requirements, refocusing the Counterintelligence and Export Control Section and its Foreign Agents Registration Act Unit, and dissolving the KleptoCapture Task Force and other related initiatives.
Despite these changes, the Trump administration's use of economic countermeasures such as sanctions and export controls means companies should remain vigilant on sanctions and export control compliance. Moreover, the administration's push to designate cartels and transnational criminal organizations ("TCOs") as Foreign Terrorist Organizations ("FTOs") and Specially Designated Global Terrorists ("SDGTs"),1 as well as the Department's prioritization of investigations into these entities—including through the use of criminal terrorism and sanctions charges—may well result in more cartel- and TCO-related corporate prosecutions. We will continue to monitor these developments and analyze how they may affect corporate and individual clients.
Major Changes in National Security Enforcement
In the hours after her confirmation, Attorney General Bondi continued President Trump's effort to reshape the Justice Department by issuing over a dozen memoranda, some of which indicate major shifts in the Department's national security priorities.2 We discuss the changes below.
Changes to the National Security Division ("NSD"):
- Disband NSD's Corporate Enforcement Unit;
- Suspend NSD's approval authority for charging most terrorism offenses when tied to investigations of cartels or TCOs designated as FTOs or SDGT pursuant to the President's January 20, 2025, Executive Order;
- Suspend the Counterintelligence and Export Control Section's ("CES") approval authority for charging criminal violations of the International Emergency Economic Powers Act ("IEEPA") when tied to investigations of cartels or TCOs designated as FTOs or SDGTs pursuant to the President's January 20, 2025 Executive Order;
- Limit criminal investigations and prosecutions under the Foreign Agents Registration Act ("FARA") and 18 United States Code ("USC") § 951 to matters involving "conduct similar to more traditional espionage by foreign government actors"; and
- Focus CES and the FARA Unit on civil enforcement, regulatory initiatives and public guidance with respect to FARA and 18 USC § 951.
Changes to Other National Security-Focused Initiatives:
- Disband the Department's KleptoCapture Task Force and the Kleptocracy Asset Recovery Initiative (which sits in the Criminal Division's Money Laundering and Asset Recovery Section), and
- Disband the Foreign Influence Task Force.
Items Left Unchanged:
- NSD's approval remains a requirement for plea offers, sentencing recommendations, and motions filed under the Classified Information Procedures Act ("CIPA");
- NSD's approval remains a requirement for terrorism and IEEPA charges that do not relate to cartels or TCOs that have been designated as FTOs or SDGTs; and
- NSD's approval remains a requirement before charging the following national security-related criminal charges, regardless of any connection to designated cartels or TCOs: 18 USC §§ 175 (Prohibitions with respect to biological weapons), 219 (Officers and employees acting as agents of foreign principals), 793 (Gathering, transmitting or losing defense information), 794 (Gathering or delivering defense information to aid foreign government), 831 (Prohibited transactions involving nuclear materials), 951 (Agents of foreign governments), and 1030(a)(1) (National security focused fraud and related activity in connection with computers).
Implications
For several reasons, companies should not interpret these drastic changes—especially the disbanding of NSD's Corporate Enforcement Unit—as a reason to let down their guard, particularly when it comes to sanctions and export control compliance and internal investigations.
First, the Trump administration has made clear that sanctions and export control enforcement will remain a priority. The Corporate Enforcement Unit was created with the goal of investigating and prosecuting corporate actors involved in sanctions evasion, export control violations, and other national security-related economic crimes.3 While the Attorney General has disbanded the unit, her memoranda do not state that the Department is de-prioritizing sanctions and export control enforcement. To the contrary, the Trump administration has emphasized that it will continue to use sanctions and export controls to advance its foreign policy and national security objectives. For instance, in issuing National Security Presidential Memorandum ("NSPM")-2,4 President Trump made clear that sanctions and export controls will be centerpieces in imposing maximum pressure on the Government of Iran. NSPM-2 directs the Attorney General to "use all criminal, regulatory, and cyber authorities and tools to vigorously investigate, prosecute, and disrupt efforts by the Iranian government to…evade sanctions and export controls." NSPM-2 additionally tasks the Treasury, State, and Commerce Secretaries to leverage their respective authorities to implement a "robust and continual" sanctions and export control enforcement campaign. Similarly, pursuant to the American First Trade Policy,5 the Secretaries of State and Commerce are directed to review the U.S. export control system and advise on modifications with an eye toward new geopolitical developments and national security and global considerations. The review must also result in recommendations regarding export control enforcement policies and practices.
Second, while the Attorney General has disbanded the Department's KleptoCapture Task Force and the Kleptocracy Asset Recovery Initiative, both initiatives created a framework and developed expertise that should be critical tools in pursuing the Department's goal of the "total elimination" of cartels and TCOs. The Kleptocracy Asset Recovery Initiative focused on using criminal prosecution and civil asset forfeiture to combat foreign official corruption, and prosecutors who worked on these matters have deep expertise in conducting complex investigations to trace, seize, and forfeit assets internationally. The Attorney General has instructed these attorneys to focus on cartels and TCOs, and we similarly expect the Department to deploy their expertise with complex, international asset forfeiture matters in connection with the U.S. government's efforts against foreign state adversaries, including the Government of Iran. Indeed, the Department has long successfully used civil asset forfeiture tools to curb Iran's ability to sell Iranian oil.6 Devoting additional prosecutorial resources to such efforts would be consistent with one of NSPM-2's goals – to "drive Iran's export of oil to zero." Moreover, the KleptoCapture Task Force was an interagency task force that deployed a "whole-of-government" approach to enforcing Russia-related economic countermeasures through criminal prosecutions and civil asset forfeiture actions. During the Task Force's existence, the Department strengthened its relationship with key regulators, including the Financial Crimes Enforcement Network ("FinCEN"), the Office of Foreign Assets Control ("OFAC"), and the Bureau of Industry and Security ("BIS"). Those relationships are expected to continue, especially as the Trump administration begins to designate particular cartels and TCOs as FTOs and SDGTs.
Finally, the Attorney General's memorandum addressing the potential filing of criminal terrorism and sanctions charges in connection with cartel- and TCO-related investigations highlights an additional risk area for corporate entities. Companies that operate in areas controlled by cartels or TCOs that have been designated as FTOs or SDGTs, for example, face heightened risk of investigation and prosecution under the Antiterrorism Act ("ATA"), 18 USC § 2339B, and IEEPA. Paying fees to a designated group for protection or to operate in an area they control or selling them goods or services could lead to criminal investigation and prosecution. The Department has brought such charges before, prosecuting Chiquita Brands International under IEEPA for making such payments to an organization in Colombia that had been designated as both an FTO and an SDGT.7 The Department also prosecuted Lafarge S.A. and Lafarge Cement Syria S.A. for conspiring to provide material support to FTOs for making payments to the Islamic State of Iraq and al-Sham ("ISIS") and the al-Nusrah Front ("ANF") for protection, to continue operating in areas they controlled, and to obtain economic advantages. These statutes have expansive jurisdictional reach, in particular the ATA, which applies, among other circumstances, to U.S. persons and any person in the United States (regardless of whether they were in the United States at the time of the conduct) and to conduct that affects interstate or foreign commerce. In the Lafarge case, for example, jurisdiction appears to have been based on a single wire transfer through a U.S. correspondent bank account and the use of U.S.-based email accounts. And in the absence of an imminent and unlawful threat of death or serious bodily injury, duress is unlikely to be available as a defense. With the DOJ's prioritization of terrorism and sanctions offenses involving cartels and TCOs and these organizations' imminent designation as FTOs and SDGTs, companies operating in cartel- or TCO-controlled areas will face heightened enforcement risks. They should carefully consider how they conduct business in those areas and ensure that they have robust compliance programs with clear guidelines and protocols to avoid violating the law.
1 Exec. Order Designating Cartels and Other Organizations as Foreign Terrorist Organizations and Specially Designated Global Terrorists (Jan. 20, 2025) available at www.whitehouse.gov/presidential-actions/2025/01/designating-cartels-and-other-organizations-as-foreign-terrorist-organizations-and-specially-designated-global-terrorists/.
2 Dep't of Justice, Total Elimination of Cartels and Transnational Criminal Organizations (Feb. 5, 2025) available at https://www.justice.gov/ag/media/1388546/dl?inline and Dep't of Justice, General Policy Regarding Charging, Plea Negotiations, and Sentencing (Feb. 5, 2025) available at https://www.justice.gov/ag/media/1388541/dl?inline.
3 Dep't of Justice, Deputy Attorney General Lisa Monaco Delivers Remarks at American Bar Association National Institute on White Collar Crime (Mar. 2, 2023) available at https://www.justice.gov/archives/opa/speech/deputy-attorney-general-lisa-monaco-delivers-remarks-american-bar-association-national#:~:text=We%20will%20add%20more%20than,Chief%20Counsel%20for%20Corporate%20Enforcement.
4 National Security Presidential Memorandum 2 (Feb. 4, 2025) available at https://www.whitehouse.gov/presidential-actions/2025/02/national-security-presidential-memorandum-nspm-2/.
5 America First Trade Policy (Jan. 20, 2025) available at https://www.whitehouse.gov/presidential-actions/2025/01/america-first-trade-policy/.
6 Dep't of Justice, Largest U.S. Seizure of Iranian Fuel from Four Tankers (Aug. 14, 2020) available at https://www.justice.gov/archives/opa/pr/largest-us-seizure-iranian-fuel-four-tankers.
7 Dep't of Justice, Chiquita Brands International Pleads Guilty to Making Payments to a Designated Terrorist Organization and Agrees to Pay $25 Million Fine (March 19, 2007) available at https://www.justice.gov/archive/opa/pr/2007/March/07_nsd_161.html.
8 Dep't of Justice, Lafarge Pleads Guilty to Conspiring to Provide Material Support to Foreign Terrorist Organizations (Oct. 18, 2022) available at https://www.justice.gov/archives/opa/pr/lafarge-pleads-guilty-conspiring-provide-material-support-foreign-terrorist-organizations.
9 See, e.g., Dep't of Justice, A Resource Guide to the U.S. Foreign Corrupt Practices Act 27-28 (2d ed.) (2020) available at https://www.justice.gov/criminal/criminal-fraud/file/1292051/dl; Dep't of Justice, Foreign Corrupt Practices Act Review: Opinion Procedure Release No. 22-1 (Jan. 21, 2022) available at https://www.justice.gov/criminal/criminal-fraud/page/file/1466596/dl?inline.
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