Handling DEA Action PART IV: What is an MOA and What Do You Do When DEA Demands One?

If it believes more serious action than an LOA (an enforcement tool discussed in PART III of this series) is needed to bring a registrant into compliance, DEA may seek a memorandum of agreement (“MOA”). An MOA is a formal agreement between DEA and a registrant that identifies areas of non-compliance and imposes contractual obligations on the registrant that are designed to fully bring the registrant into compliance. MOAs are forceful and effective enforcement tools at DEA’s disposal that carry serious implications. Notable elements of MOAs are that they:

·       Are legally binding.

• Often include compliance obligations that go beyond what is expressly mandated by the CSA and DEA’s regulations.

• May become publicly accessible through FOIA.

• Are usually in effect for several years.

• Can be used against registrants in any future administrative action DEA want to pursue.

(NOTE: When an Assistant U.S. Attorney accepts a CSA case DEA has referred for civil prosecution, registrants will often find themselves facing two distinct matters: (1) DEA’s administrative case that will be resolved through an MOA and (2) DOJ’s civil case that will be resolved through a settlement agreement. Registrants are often led to believe a settlement agreement with DOJ automatically requires an MOA with DEA. While both cases are generally negotiated alongside each other, ultimately, each one will be resolved independent of the other.)

When is an MOA Used?

DEA usually pursues an MOA:

• After an audit or investigation that reveals non-compliance (e.g., recordkeeping issues, security lapses, or prescribing irregularities) that justify more serious action than an LOA.

• When it has previously issued multiple LOAs for minor violations, yet the registrant’s non-compliance persists.

• In lieu of immediate suspension or revocation proceedings.

• When the DEA determines the registrant is willing and capable of correcting deficiencies.

How Do You Respond to a Proposed MOA and What Do You Do if You Enter into an MOA?

1. Consult with Legal Counsel Immediately.

Never sign an MOA without a thorough review by an experienced DEA compliance attorney, including DeKo Law and other firms like it. These agreements may contain broad admissions, waiver of rights, or burdensome requirements that affect your practice long-term, so it is critical to have legal representation in advocating for your rights and in negotiating the terms of any MOA entered into.

2. Understand the Proposed MOA’s Obligations.

Carefully review what DEA is proposing in the MOA and make sure you understand things such as:

• Are you required to implement new recordkeeping protocols?

• Are periodic self-audits mandated?

• Are new security or systematic measures required to be implemented that would create financial burdens?

• Will you need to submit regular compliance reports or notify DEA of future non-compliance you discover?

Understanding these expectations is critical to determining whether you are reasonably able to comply with the MOA.

3. Evaluate the Proposed MOA’s Terms.

Beyond the corrective measures that may be included in a proposed MOA, review the terms of the MOA and negotiate where appropriate. Terms to consider include:

• What is the durational term of the proposed MOA?

• Are the terms reasonable and achievable?

• What are the consequences of a breach?

• Can you request modifications?

Some terms may be negotiable before signing, especially if you can demonstrate good faith efforts to improve compliance.

4. Develop a Plan to Implement the MOA Upon Execution.

Once signed, the MOA becomes enforceable, so the registrant must act to ensure compliance with its terms. Develop a comprehensive compliance plan that corrects areas of non-compliance, reviews for any other areas of non-compliance and monitors the efficacy of the corrective measures over the course of the MOA’s durational term.

It is often prudent to consider engaging a DEA consultant to assist with implementation of this plan. It is critical to select a credible DEA consultant with relevant and adequate expertise, such as Brinks DEA Consulting and similarly reputable firms.

5. Document Your Implementation of Corrective Measures Mandated by the MOA.

DEA may eventually seek evidence of your efforts to comply with the MOA, so consider what actions need to be documented, which may include records regarding staff training, incident reports or internal audit reports.

Well-organized records are your best defense in case of future scrutiny on your adherence to of the MOA’s terms.

6. Communicate with DEA on New Issues that Impact the MOA’s Terms.

If you encounter challenges meeting the terms of the MOA (e.g., due to staffing shortages, new financial hardship, systematic changes/upgrades that impact existing processes), communicate with your local DEA field office early to discuss any implications they may have for the MOA and whether any terms of the MOA may need to be adjusted. Proactive engagement can help maintain trust and avoid penalties for technical breaches.

What Happens If You Breach the MOA?

Violating the terms of an MOA can lead to severe consequences, particularly where the violations are intentional or inexcusable neglect. While DEA is often understanding of incidental violations occur despite the registrant’s good faith efforts, more over breaches of an MOA may encourage DEA to pursue:

• Immediate suspension of the registration

• Revocation of the registration

• Civil monetary penalties

• Criminal investigation (in cases of willful misconduct)

• Damage to your professional reputation through press releases on new action taken by DEA

Always treat compliance with the MOA as a top priority.

Conclusion

An MOA is not something to shrug off—it's a critical turning point for any registrant. While it offers a chance to retain your DEA registration and continue operations, it also puts you under heightened scrutiny. With the right legal advice and a proactive compliance mindset, you can not only meet the terms of the MOA but use it as a springboard to improve your overall regulatory standing.