Paying the Public to Find Fraud: Inside the WHIP Program

A Bounty on Fraud

The federal government will now pay ordinary Americans $10,000 to $30,000 for fraud tips that lead to criminal charges. The Justice Department announced the Fraud Whistleblower Incentive Program, or WHIP, on Oct. 20, 2026.

The first check went to Nick Shirley. The 24-year-old YouTuber received $10,000 in the Oval Office for his 2025 video on Minnesota child care centers, according to KSL.

The timing was not subtle. The same week, federal and state agents searched social adult day care centers across New York City. Two days later, prosecutors in Los Angeles charged 15 defendants in schemes alleged to total nearly $2 billion, including a surgeon accused of performing unnecessary artery procedures.

This article examines how WHIP is funded, what the Minnesota, California and New York cases show, whether journalists can collect, and why a program like this may exist at all.

At a glance

What: The Fraud Whistleblower Incentive Program (WHIP), a three-year DOJ pilot announced Oct. 20, 2026.
Pays: $10,000 to $30,000 per qualifying tip, once criminal charges are filed.
Funded by: $25 million committed by the Treasury Department.
Covers: Federal health care fraud and fraud on programs run by eight federal agencies, with priority on hospice, home health, day care and special services.
Where to report: america.gov/fraud.
Context: GAO estimates federal fraud losses at $233 billion to $521 billion a year.

How WHIP Works, and Who Pays for It

WHIP is funded up front by the Treasury Department, not by money recovered from fraudsters. DOJ says Treasury is “committing $25 million” to the program. The announcement does not say which Treasury account the money comes from.

That structure is the program’s main novelty. Most federal reward programs pay only after a case ends, including forfeiture and appeals, which can take years. WHIP pays once DOJ files and unseals an indictment, information or criminal complaint, per a Ballard Spahr analysis of the published terms.

The basic rules:

Award: a fixed $10,000 to $30,000 per distinct tip, with no minimum loss amount.
Coverage: federal health care offenses and fraud on programs run by Agriculture, Labor, HHS, HUD, Education, Veterans Affairs, the Department of War and the SBA.
Priorities: hospice, home health care, day care and “special services” fraud.
Eligibility: individuals only, with original information submitted in writing, plus cooperation with investigators. People who meaningfully took part in the crime are excluded.
Term: a three-year pilot run by DOJ’s National Fraud Enforcement Division, created in April 2026.
Tip portal: america.gov/fraud. Terms are at justice.gov/fraud/whistleblower.

The 1% question

The President described something different. In the Oval Office, Trump said tipsters would receive a 1% commission on the fraud they uncover. He added there was “no limit” on the amount, The Hill reported. He also said he would personally decide disputes when more than one person claims a tip.

Neither the 1% figure nor a presidential role appears in DOJ’s written announcement. DOJ says awards are made “in the Justice Department’s sole discretion.” Until the terms change, the published rules govern.

In simple terms: DOJ’s program pays a flat finder’s fee when charges are filed. The President described a percentage commission on recoveries. Those are two different programs.

The math on $25 million

The fund is small relative to the fraud being described. At the $30,000 ceiling, $25 million covers about 833 awards. At the $10,000 floor, it covers 2,500.

A true 1% commission would exhaust the fund quickly. One percent of the $9.3 billion in alleged Minnesota fraud cited by House investigators is $93 million, nearly four times WHIP’s entire budget.

The scale of the problem

The national numbers are far larger. The Government Accountability Office estimates the federal government loses $233 billion to $521 billion a year to fraud, based on fiscal 2018–2022 data. That is 3% to 7% of average federal obligations.

GAO officials put it this way: fraud may be the sixth-largest “agency” taxpayers fund each year. WHIP’s entire $25 million budget equals about 0.01% of the low end of that range.

The estimate has limits. It is not a forecast, and the data window includes pandemic-era programs. The Office of Management and Budget criticized it as a simulation rather than a program-by-program count. It also largely excludes fraud against federal programs that happens at the state or local level, unless federal authorities investigated it. Much of the Medicaid fraud in this article falls in that category.

A second figure is more current. Agencies reported about $186 billion in improper payments in fiscal 2025 across 64 programs, Government Executive reported. Medicare accounted for about $57 billion and Medicaid about $37 billion.

In simple terms: improper payments are not the same as fraud. The category includes paperwork errors, payments in the wrong amount and underpayments. Fraud requires intentional deception.

The gap explains the 1% debate. A true 1% commission on GAO’s low-end estimate would come to about $2.3 billion a year, roughly 93 times what Treasury has committed.

How it compares

Program	Who pays	Award	When paid
WHIP (DOJ, 2026)	Treasury, $25M committed	$10K–$30K flat	At criminal charging
False Claims Act qui tam	Recovered funds	15%–30% of recovery	After settlement or judgment
SEC Whistleblower Program	Investor Protection Fund, financed by sanctions	10%–30% of sanctions over $1M	After sanctions are collected
DOJ Corporate Whistleblower Awards Pilot	Forfeited assets	Up to 30% of first $100M forfeited	After forfeiture

The established programs are self-funding. SEC awards come from a fund that is financed entirely by sanctions paid by securities violators. False Claims Act relators share in what the government recovers.

Those programs are not small. DOJ recovered a record $6.8 billion under the False Claims Act in fiscal 2025, and whistleblowers filed a record 1,297 qui tam suits, according to Morgan Lewis. WHIP tipsters remain eligible for those larger awards if their case later produces a recovery.

The case for paying at charging is that recovery often never comes. In Minnesota’s Feeding Our Future case, prosecutors have recovered only about $60 million of $250 million stolen, CNN reported. A percentage-of-recovery program would pay little on a case like that.

Minnesota: Where the Program’s Story Begins

Minnesota is the case the administration built WHIP around. A June 2026 House Oversight Committee majority-staff report alleged as much as $9.3 billion in social services fraud and said state officials knew of systemic problems as early as 2019.

The best-documented scheme is Feeding Our Future. Prosecutors say the nonprofit and its network claimed to serve millions of meals to children during the pandemic that were never served. The scheme took roughly $250 million in federal child nutrition money.

That case predates Shirley by years. It was first charged in 2022. Ringleader Aimee Bock was sentenced to more than 41 years in prison, Newsweek reported. This week, a jury returned the case’s 75th conviction.

What the Shirley video did and did not show

Shirley’s 42-minute video, released in December 2025, showed child care centers that appeared empty despite receiving public subsidies. It drew tens of millions of views and preceded a surge of federal investigators into the state.

The record is mixed. The CEO of one featured center, Future Leaders Early Learning, later pleaded guilty to wire fraud and conspiracy tied to Feeding Our Future.

But state inspectors who visited the featured sites afterward found children present at all but one, which had not yet opened for the day, CNN reported. The most prominent site, Quality Learning Center, had 121 licensing violations in three years but has not been charged with fraud, according to the Star Tribune.

In simple terms: the video pointed at a real problem that prosecutors were already pursuing. Not every location it showed has turned out to be fraudulent.

California: Hospices and an Unnecessary-Surgery Indictment

California’s problem is concentrated in Los Angeles County hospice care, and this week it reached the operating room. On Oct. 22, DOJ announced a takedown it said involved more than $1.8 billion in fraudulent claims.

The surgeon and the chiropractor

The case drawing the most attention is United States v. Tabaie and Malek (C.D. Cal. No. 2:26-cr-00668). Cardiothoracic surgeon Harold Tabaie, 78, and chiropractor Hany Malek, 61, are charged with a $135 million scheme to bill Medicare for unnecessary arterial procedures, per DOJ.

The procedure is an atherectomy, in which a bladed catheter scrapes plaque from an artery. The indictment alleges:

Malek posed as a medical doctor and diagnosed arterial disease patients did not have.
Tabaie performed atherectomies on patients without arterial disease, and repeated failed procedures on others.
Some patients experienced extreme pain afterward.
The pair billed under other providers’ names to hide Tabaie’s unusually high volume.

The clinics were West Regional Cardio Thoracic and Vascular Surgeons in Inglewood and Angelus Medical Clinic in Boyle Heights. Investigators flagged Tabaie through data analytics showing he was an extreme national outlier for atherectomy billing, FOX 11 reported. Both men are presumed innocent.

In simple terms: this is the kind of fraud that hurts patients directly, not just taxpayers.

The hospice problem

The hospice warnings are years old. A 2022 California State Auditor report found that weak controls had “created the opportunity for large-scale fraud,” with a roughly 1,500% increase in Los Angeles County hospice agencies over a decade, CalMatters reported.

In 2026, a CBS News investigation found that 742 of roughly 1,800 hospices in the county showed multiple state-defined fraud indicators. In April, Attorney General Rob Bonta charged 21 people in a $267 million ring that billed for patients who never received care.

The state disputes that it looked away. Gov. Gavin Newsom says California has revoked at least 280 hospice licenses since 2021, and Bonta’s office has filed 119 hospice criminal cases. Federal officials counter that the state missed a Jan. 1, 2026, deadline for emergency hospice rules, FOX 11 reported.

One figure needs care. CMS Administrator Mehmet Oz has cited $3.5 billion in Los Angeles hospice and home health fraud. His agency later clarified that number is total billing in those categories, not confirmed fraud, KFF Health News reported.

New York City: The Adult Day Care Raids

New York’s case is the newest, and the least developed. On Oct. 20, the FBI and state agencies searched social adult day care centers in Queens, Brooklyn and Staten Island. Gov. Kathy Hochul described a months-long investigation of more than 100 providers, the South Shore Press reported.

Social adult day care is a non-medical Medicaid benefit. It offers seniors meals, activities and supervision so they can keep living at home.

The first charges

One indictment has been announced so far. Staten Island District Attorney Michael McMahon charged Yangsim Oum and Juyoung Choe, the owner and program director of Staten Island Adult Day Care Center in Mariners Harbor, Gothamist reported.

Prosecutors allege the center billed Medicaid about $530,000 over roughly four months for services never provided. Some of the billed clients had died or were out of the country. A law-firm summary describes the indictment as 457 counts. Most providers under review have not been charged.

What the $2.4 billion means

Headlines have called this a “$2.4 billion” fraud probe. That number is what Medicaid paid for social adult day care in New York from 2019 to 2024, according to the FBI. It is total spending, not an estimate of fraud.

Oz joined two of the site visits, at Kent Senior Care and Evergreen Adult Day Care in Flushing, and delivered warning letters, Fox News reported. He also suggested organized crime involvement. Federal prosecutors have not made that allegation in any filing NexfinityNews has reviewed.

Not a new problem

New York prosecutors have pursued this sector before. Federal charges in February 2026 described a $120 million Medicare and Medicaid scheme run through a Queens pharmacy and adult day care centers. Last month, the owner of two Coney Island adult day cares was sentenced to more than six years for a $64 million kickback scheme, Gothamist reported.

Can Journalists Like Nick Shirley Get Paid?

Yes, in principle. Trump said journalists could take part, the AP reported, and nothing in DOJ’s announcement excludes them. In practice, the rules create three hurdles for anyone who reports in public.

1. “Original information.” WHIP pays for information the government does not already have. A tip sent to DOJ before publication fits that test cleanly. A video that has already been seen by millions arguably does not, because the government already has it. This is NexfinityNews’ reading of the published terms; DOJ has not addressed it.

2. Cooperation. Tipsters must cooperate with the resulting investigation. For a reporter, that can mean handing over notes, footage and the identities of people who spoke on the condition they would not be named.

3. Charges, not views. The award is paid only after DOJ files charges. Allegations that go viral but never produce an indictment pay nothing.

Shirley’s own payment does not answer these questions. His $10,000 check was presented the day the program launched, for reporting done in 2025. DOJ has not said which terms, if any, it was paid under.

The ethics problem

For professional journalists, the bigger issue is independence. The Society of Professional Journalists’ Code of Ethics tells reporters to refuse fees and avoid activities that may compromise their impartiality. A reporter who stands to collect money when the subject of a story is charged has a financial stake in the outcome.

There is a fair counterargument. Many independent creators already earn money from the attention their investigations draw. A government reward is a more visible payment, but not the only one.

In simple terms: an independent investigator can collect, but a newsroom that follows SPJ standards would likely bar its reporters from doing so.

Risks on the other side

Shirley says he now needs a security detail after his locations were shared online, Fox News reported.

California has also moved in the other direction. On Aug. 22, 2026, Newsom signed AB 2624, which expands the state’s Safe at Home address-confidentiality program to workers at nonprofits serving immigrants, the San Francisco Chronicle reported. Republicans call it the “Stop Nick Shirley Act” and argue it chills reporting. Supporters say it targets doxxing with intent to threaten, not journalism.

Why a Program Like This May Be Necessary

The strongest argument for WHIP is that the people inside the system reported fraud, and the system did not act. In each of the three states, warnings came years before the arrests.

Minnesota: warnings met with retaliation

Current and former Minnesota Department of Human Services staff say they flagged fraud risks for years. In a seven-page letter to federal officials, they wrote that their warnings were “ignored, dismissed, or met with retaliation,” the Star Tribune reported.

The House Oversight report says the committee spoke with nearly 30 whistleblowers. It alleges the agency’s internal fraud tip line was de-anonymized and tips were routed to human resources. When staff set up an outside anonymous email, the report says, the agency blocked it, the Washington Times reported.

That report was written by the Republican majority staff. State officials have disputed parts of it. Then-Commissioner Shireen Gandhi testified that employees who report problems can perceive ordinary actions as retaliation. Democratic legislators on the state’s fraud committee have said whistleblowers did not come to them.

California: a known risk, slow rules

The state auditor flagged hospice fraud risk in Los Angeles County in 2022. Four years later, CBS found more than 40% of the county’s hospices showing multiple fraud indicators, and the state missed its own deadline for emergency hospice rules.

New York: a known sector

Federal prosecutors have charged adult day care schemes in New York since at least 2024. The October raids suggest the state’s own payment controls did not stop new ones.

The design response

WHIP routes tips directly to federal prosecutors. A state employee who has been ignored internally, or a family member who sees an empty center billing Medicaid, no longer has to go through the agency that may have missed it.

In simple terms: the program is a bypass around state agencies that did not act on what they were told.

Congress is working on the other half of the problem. A House bill introduced this month, the Medicaid Whistleblower Protection Act, would add protections for workers who report Medicaid fraud, Valley News Live reported. WHIP pays tipsters. It does not protect state employees from their employers.

Analysis: The Open Questions

WHIP’s design fixes a real gap, but its rollout raised questions that its terms do not yet answer.

Who decides. DOJ’s terms give the department sole discretion. The President said he would be “the arbitrator” of competing claims. A reward system that depends on one official’s judgment invites questions about consistency.

Who gets targeted. Critics argue a bounty can reward spectacle over evidence. Joe Spielberger of the Project On Government Oversight called it “not a serious anti-fraud or whistleblower incentive program,” saying it could incentivize political provocateurs, Spectrum News reported. The first award went to a creator whose video focused on one immigrant community.

Whether tips get worked. Federal whistleblower channels are already strained. POGO found the Office of Special Counsel referred only 27 of 2,535 whistleblower disclosures for investigation in fiscal 2025, per its May 2026 analysis. A flood of new tips needs investigators on the other end.

Whether the money lasts. At $30,000 per award, the fund runs out after about 833 payments. DOJ has not said what happens then.

Supporters answer that the alternative has already been tested. State agencies in Minnesota and California had years of warnings. Federal data tools caught the Los Angeles surgeon, but hospice clusters sat in plain view for years. Paying the public to look is cheap compared with the losses.

Conclusion

WHIP is a $25 million bet that the public will see what agencies missed. It is funded up front by Treasury, pays a flat fee at charging, and sits on top of larger programs that pay only after money is recovered.

The cases behind it are real. Minnesota has 75 Feeding Our Future convictions. A Los Angeles surgeon is accused of operating on patients who did not need it. A Staten Island center allegedly billed for seniors who had died.

What remains unsettled is the gap between the rules DOJ published and the program the President described, and whether tips will be judged on evidence rather than audience. Those answers will come from who gets paid next.

Key Takeaways

Funding: Treasury committed $25 million up front; awards do not depend on recovering stolen money.
Awards: DOJ’s terms pay $10,000–$30,000 per tip at criminal charging. The President’s “1% commission” is not in the published rules.
Scale: The fund covers roughly 833 maximum awards, against GAO’s estimate of $233 billion to $521 billion in annual federal fraud losses. Separately, improper payments reached $186 billion in fiscal 2025; that figure includes errors, not just fraud.
Minnesota: Feeding Our Future took about $250 million; only about $60 million has been recovered.
California: A surgeon and chiropractor face charges in a $135 million unnecessary-atherectomy scheme.
New York: More than 100 adult day care providers are under review; one Staten Island center has been indicted. The $2.4 billion figure is total spending, not fraud.
Journalists: They can apply, but must provide original information, cooperate with investigators, and face conflict-of-interest questions under SPJ ethics.
The core argument: Insiders warned for years. WHIP gives tipsters a direct line to federal prosecutors, but no new job protection.

Frequently Asked Questions

How much does the Fraud Whistleblower Incentive Program pay?
DOJ’s published terms pay a fixed $10,000 to $30,000 per distinct tip that leads to criminal charges. President Trump described a 1% commission, but that figure is not in DOJ’s written terms.

Who funds WHIP?
The Treasury Department has committed $25 million. Unlike the False Claims Act and SEC programs, awards are not paid out of recovered money.

When is a WHIP award paid?
After DOJ files and unseals an indictment, information or criminal complaint, not after a conviction or forfeiture.

Can journalists receive a WHIP award?
The President said journalists can participate. Tipsters must provide original information in writing and cooperate with investigators, which raises source-protection and ethics issues for reporters.

How much fraud does the federal government lose each year?
GAO estimates $233 billion to $521 billion a year, based on fiscal 2018–2022 data. Separately, agencies reported $186 billion in improper payments in fiscal 2025, a broader category that includes errors.

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