IBM, a leading corporate computing company and one of the most storied names in American business, has agreed to pay the U.S. government $17 million to settle Justice Department allegations that the company’s diversity, equity and inclusion policies violated antidiscrimination laws.
The Justice Department touted the settlement as a major win for the Trump administration’s crackdown on DEI policies, saying it is the first successful use of the False Claims Act under the department’s new Civil Rights Fraud Initiative. Under that act, federal officials investigated whether IBM lied on federal forms to receive government contracts when it certified that the company was in compliance with antidiscrimination laws.
IBM did not admit to wrongdoing as part of the settlement.
The resolution is the latest in a string of announcements that the Justice Department has rolled out that align closely with President Donald Trump’s agenda since the president ousted Pam Bondi as attorney general earlier this month. Deputy Attorney General Todd Blanche has been tapped to at least temporarily lead the department, and Trump has signaled he wants him to carry out his political agenda more aggressively than Bondi did.
Blanche and Associate Attorney General Stanley Woodward — the third-ranking official at the Justice Department, whose job includes overseeing civil cases — announced the resolution with IBM last week.
Amid reports in right-wing media that Woodward had been pushed out of the department along with Bondi, the associate attorney general said in an interview this week that he has long-term plans to remain at his job.
“I have two years and 279 days, at most, left on the job,” Woodward said, referring to the amount of time remaining in Trump’s term. “We have a lot to execute on in furtherance of the president’s agenda.”
Woodward’s comments came amid a number of real and potential vacancies created by Bondi’s sudden dismissal two weeks ago, prompting widespread speculation and vigorous jockeying inside and outside the Justice Department.
Woodward said he is hopeful the Justice Department will reach similar resolutions with other companies, noting that the department has more than a dozen ongoing DEI-related False Claims Act investigations.
The Justice Department has been tasked with delivering on Trump’s vows to eviscerate DEI across the federal government and at institutions that receive government funding, including universities and companies with government contracts such as IBM. The president and his allies argue that such programs amount to racial discrimination against White people and men, a sharp reversal from President Joe Biden’s strong support for DEI initiatives.
The Justice Department has dedicated significant resources to investigating and suing universities over their purported DEI practices. Across the federal government, including at the Justice Department, officials have cut grant funding to organizations that officials have determined to be using DEI practices.
Federal courts have not deemed DEI practices inherently illegal, although many private companies, universities and government agencies have dismantled programs aimed at making their organizations more diverse amid punitive threats from the Trump administration.
In the IBM settlement, the Justice Department cited a handful of the company’s policies and programs that it claimed violated antidiscrimination laws, including mentoring and leadership development programs offered to certain employees based on their background or gender. It also said that IBM offered bonus compensation if managers hit certain demographic targets in hiring.
IBM did not immediately respond to a request for comment. The $17 million penalty is minuscule for a corporation like IBM, which reported $67.5 billion in revenue for 2025.
The settlement filing noted that IBM was cooperative throughout the investigation, leading to a more advantageous settlement for the company.
“I see that as more of a starting point and fully expect many more resolutions in time,” Woodward said in the interview. “IBM is a signal to the workforce, to private industries, that we are coming for you.”
The Justice Department’s pace in churning out actions since Bondi’s departure that jibe with Trump’s national agenda has been notable.
Earlier this week, the Justice Department released a long-awaited report contending that the Biden administration had weaponized a law that has historically been used to prosecute people who physically block women from entering abortion clinics.
Separately, the Justice Department asked a judge to overturn the seditious conspiracy convictions of 12 members of the Proud Boys and Oath Keepers who helped plan the Jan. 6, 2021, riots. That move would undo the most serious convictions stemming from the assault on the U.S. Capitol and would mark the Trump administration’s latest effort to rewrite the event’s violent history.
Trump has not yet said who he wants to serve permanently as his next attorney general, but a White House official said that the president is happy with Blanche, who was formerly his personal lawyer, suggesting that the powerful job is Blanche’s to lose. Blanche had been serving as the deputy attorney general, a slot that would become vacant if he gets the top job but cannot be filled while he is in temporary status.
The shake-up has filled the upper ranks of the department with uncertainty, but Woodward insisted the drama is not a distraction.
“It is all about is moving the ball forward on behalf of the president’s agenda,” Woodward said. “I don’t have patience for this palace intrigue.”
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