Treasury Proposes Whistleblower Program to Fight Fraud

WASHINGTON—The Treasury Department issued a warning to financial institutions to be vigilant about fraud schemes targeting government health care benefit programs such as Medicare and Medicaid—and also proposed a plan to pay some whistleblowers whose tips lead to fraud convictions. 

The advisory follows Secretary of the Treasury Scott Bessent’s trip to Minnesota earlier this year, where he announced numerous steps the department is implementing to detect and stop government benefits fraud across the country. In a separate announcement, the Department of Treasury’s Financial Crimes Enforcement Network (FinCEN) also relesed a proposed rule paving the way to pay whistleblowers for actionable tips.

“As promised, the Treasury will reward whistleblowers who provide timely, actionable information on fraud, sanctions violations and other significant illicit finance activity,” Bessent said. “President (Donald) Trump has been clear that Americans have a right to know that their tax dollars are not being diverted to fund acts of global terror or to fund luxury cars for fraudsters. At Treasury, we follow the money, and we strongly encourage individuals to come forward with credible tips to help safeguard our financial system.”

The rule proposes:

• Procedures for whistleblowers to share information about potential violations in a timely and secure manner, including for submitting an award application
• Eligibility criteria for making awards and the process for adjudicating award applications
• Awards of 10% to 30% of collected monetary penalties for individuals whose tip leads to a successful enforcement action by Treasury or the Department of Justice
• Protections for whistleblowers who provide information to FinCEN’s whistleblower program.

Although FinCEN’s whistleblower program is codified by the Anti-Money Laundering Act (2020) and the Anti-Money Laundering Whistleblower Improvement Act (2022) and is currently accepting tips, the regulation proposed, when finalized, will fully implement these statutes. Whistleblowers are encouraged to submit information as soon as possible and to provide detailed, specific documentation to support their claims. FinCEN also recently launched a portal for whistleblowers, which you can find here.

The advisory also outlines how the department says transnational criminal groups manage federal and state health care fraud schemes. 

Members of the public should submit comments in response to the proposed rule within 60 days of the its publication in the Federal Register. Comments responding to this notice will be publicly viewable at regulations.gov.