Smith led two since-dismissed federal criminal cases against Trump accusing him of plotting to overturn his 2020 election defeat and mishandling classified documents.
Trump and his allies have portrayed those cases as misuse of the criminal justice system. Smith has defended his probe, saying politics played no role in the work of his office.
"We're going to continue holding the people who were responsible for the weaponization of government - who supported it - accountable," Trump told reporters at the White House.
The memorandum suspends security clearances for lawyers and employees at the firm who advised Smith during his time as special counsel. It also directs U.S. agencies to end engagements with Covington to the extent allowed by law and orders a review of government contracts with the firm.
A spokesperson for Covington said the firm is defending Smith in his personal capacity.
"We recently agreed to represent Jack Smith when it became apparent that he would become a subject of a government investigation," the spokesperson said in a statement.
Smith disclosed receiving $140,000 worth of free legal services from the firm after leaving the Justice Department last month, Politico reported.
Trump has repeatedly railed against Smith and his allies have threatened investigations into Smith and others who pursued Trump during his years out of power.
Attorney General Pam Bondi, on her first day in office, started a "weaponization work group" tasked with conducting an internal review of Smith and his staff.
Covington is among the most prominent law firms in Washington and has traditionally had deep ties to government agencies. It has a number of former top U.S. government lawyers in its ranks, including former Attorney General Eric Holder.
