Stop the Scammers Act: CFPB Offers 10% to 30% Payouts for Whistleblowers Reporting Financial Fraud, Boosts Agency Funding

This bill, officially titled the Stop the Scammers Act, is setting up a serious incentive program for anyone with the inside track on consumer financial fraud. Essentially, it creates a new whistleblower program within the Consumer Financial Protection Bureau (CFPB) that promises big payouts—between 10% and 30% of the penalties collected—if your original information leads to a successful enforcement action where the CFPB collects over $1 million. For smaller cases, even if the total penalty is less than $1 million, a single whistleblower is guaranteed the greater of 10% of the collected penalty or a flat $50,000 award. This is a direct play to get people to risk coming forward with solid evidence against predatory lenders, scam artists, and shady financial institutions.

The Bounty Hunter Program: Incentivizing the Inside Scoop

The key to this whole system is providing “original information”—meaning it has to come from your independent knowledge or analysis. You can’t just recycle an old news story or an existing audit report. If you’re an employee or former employee who sees something illegal happening, this bill gives you a financial reason to report it. The money for these awards comes directly from the Consumer Financial Civil Penalty Fund, which is funded by the penalties collected in these enforcement actions. For the average person, this means that the people who perpetrate fraud are now directly funding the people who expose them. The CFPB has discretion to decide the exact percentage of the award, but they have to consider factors like how helpful your information was and how much assistance you provided to their legal team.

Your Right to Speak Up is Protected

One of the biggest hurdles for whistleblowers is the fear of retaliation, often enforced through employment contracts. This bill tackles that head-on in Section 2 by making it clear that virtually no agreement—including those mandatory pre-dispute arbitration clauses that pop up everywhere—can force you to give up your rights or remedies under this new program. If you signed a contract that says you have to go to arbitration instead of court for a dispute over this, that clause is now invalid. This is a major win for workers, especially those in the financial industry, who might have been silenced by fine print. The CFPB is also mandated to protect your identity, meaning they generally cannot release information that could reveal who you are.

Fueling the Watchdog: The CFPB Gets a Budget Boost

Beyond the whistleblower program, Section 3 quietly gives the CFPB a significant financial upgrade. Currently, the CFPB’s funding is capped at 6.5% of the Federal Reserve’s prior year earnings. This bill raises that cap to a whopping 12% of those earnings. This change essentially gives the CFPB a much larger, more stable budget to operate with, insulating it further from the annual appropriations battles in Congress. For those keeping score, this means the agency tasked with cracking down on financial misconduct will have nearly double the potential funding available to hire staff, launch more investigations, and, crucially, pay out these new whistleblower awards. While this increased financial independence allows the CFPB to be a stronger watchdog, it also concentrates more financial power within the agency, which is a point worth noting as they gain more autonomy over their budget. Increased funding should translate into more effective enforcement, which is ultimately good news for consumers hoping to avoid scams and predatory practices.