Attorney General Pam Bondi testifies before House panel on Dept. of Justice oversight — 2/11/26
Watch on YouTube ↗  |  February 11, 2026 at 20:43 UTC  |  5:23:16  |  CNBC
Speakers
Pam Bondi — Attorney General of the United States
Harriet Hageman — Representative (R-WY)
Ben Cline — Representative (R-VA)
Russell Fry — Representative (R-SC)
Eric Burlison — Representative (R-MO)
Troy Nehls — Representative (R-TX)
Tom Tiffany — Representative (R-WI)

Summary

  • The Department of Justice is establishing a new "National Fraud Division" with a specific focus on "industrial-scale fraud" in government programs, explicitly targeting Medicaid billing in senior living facilities and long-term care.
  • The DOJ is actively intervening to stop state-level "Climate Superfund" laws and lawsuits against energy producers, viewing them as unauthorized attempts to impose retroactive liability (likened to "tobacco litigation on steroids").
  • The administration is shifting regulatory posture on cryptocurrency software developers, moving away from treating non-custodial code writers as "money transmitters," signaling a deregulation of the DeFi interface layer.
  • There is a renewed crackdown on "illegal Chinese vapes," which may consolidate market share for compliant domestic tobacco/vape manufacturers.
  • The DOJ supports legislation creating a private right of action for minors to sue medical professionals and pharmaceutical companies regarding gender-affirming care, introducing new liability risks for specific healthcare sub-sectors.
Trade Ideas
Ticker Direction Speaker Thesis Time
SHORT Ben Cline
Representative (R-VA)
Rep. Cline asks about the new "National Fraud Division" targeting "long-term care accountability, senior living facilities engaged in Medicaid fraud, including systemic overbilling practices." Bondi confirms the new division is "set up to help" exactly with that specific targeting. Increased federal scrutiny and a dedicated fraud division targeting Medicaid billing in senior living creates significant regulatory and reimbursement risk for nursing home operators and healthcare REITs heavily exposed to government payers. The fraud division may focus only on egregious criminal rings rather than systemic corporate billing practices. 210:22
XLE /XOM /CVX
LONG Harriet Hageman
Representative (R-WY)
Rep. Hageman highlights that states (like VT and NY) are passing "Climate Superfund laws" to sue energy producers for retroactive liability, calling it "tobacco litigation on steroids." She asks if the DOJ will intervene to protect federal supremacy. Attorney General Bondi confirms the DOJ is "filing multiple lawsuits" to stop these state-level attacks on domestic energy production. Federal intervention to block state-level climate liability lawsuits removes a massive "tail risk" (potentially billions in legal settlements) for major US oil and gas producers, preserving their balance sheets and dividends. Courts may rule in favor of states' rights to regulate environmental harms, bypassing federal preemption.
LONG Russell Fry
Representative (R-SC)
Rep. Fry notes the DOJ has issued a memo titled "Ending Regulations by Prosecution," specifically stopping the practice of treating software developers (who don't control funds) as financial institutions/money transmitters. Bondi confirms they are putting this memo into practice. This removes the existential legal threat that writing code for decentralized protocols equates to running a regulated bank. Regulatory clarity for non-custodial developers is bullish for the broader US crypto infrastructure and DeFi ecosystem, reducing legal overhead and encouraging domestic innovation. Future administrations could reverse this guidance; the SEC may still pursue enforcement via securities laws independent of the DOJ.
MO /BTI
LONG Russell Fry
Representative (R-SC)
Bondi and Rep. Fry discuss the infiltration of "illegal Chinese vapes" laced with drugs and the administration's partnership with HHS to crack down on these illicit imports. The disposable vape market has been flooded with non-compliant Chinese imports that undercut regulated players. A federal crackdown clears the market for authorized, compliant manufacturers (Big Tobacco's vape arms). Reduced illicit competition boosts pricing power and market share for established tobacco companies with FDA-authorized vapor products. Enforcement may be porous; consumers may shift to the black market rather than compliant products.
AVOID Eric Burlison
Representative (R-MO)
Rep. Burlison discusses the "Khloe Cole Act," which the DOJ helped draft, creating a "private right of action" (ability to sue) for patients to sue doctors and pharma companies for gender-affirming care (puberty blockers/surgeries) with a lengthy statute of limitations. Bondi expresses strong support ("proud to work hand in hand"). This legislation opens a new floodgate of medical malpractice and product liability litigation against hospitals and pharmaceutical companies involved in these treatments. Similar to the opioid crisis, creating a specific legal framework for mass torts against healthcare providers creates unquantifiable liability overhangs for specific hospital chains and drug manufacturers. The legislation may not pass Congress; the number of claimants may be statistically insignificant to large cap pharma earnings.