Deloitte to pay $27 million to settle US government probe over DEI
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Accounting firm Deloitte agreed to a $27 million settlement with the U.S. Department of Justice to resolve allegations that its diversity, equity and inclusion (DEI) practices violated civil anti-fraud laws. The DOJ’s Civil Rights Fraud Initiative alleged that Deloitte evaluated leadership based on workforce demographic goals, which impacted promotion decisions for Black and Hispanic representation. The settlement also resolved claims brought by Edward Blum’s American Alliance for Equal Rights under the False Claims Act, with the group slated to receive $4.3 million. While Deloitte denied discriminatory conduct and liability, the firm opted to settle to avoid the costs of litigation.
Consequences
This settlement highlights the active use of the U.S. False Claims Act by the Trump administration to penalize private organizations over DEI policies. As companies face increased pressure from federal executive orders to eliminate such practices, further scaling back or modification of diversity programs across the private sector is likely.
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