A Staff Report from the Straight Dope Science Advisory Board

How often do informers collect reward money?

March 27, 2007

Dear Straight Dope:

When governments or police departments offer a monetary reward "for information leading to the arrest and conviction" of people who commit crimes, how often do they ever actually pay? Specifically, did the person(s) who located the Washington, D.C. Beltway snipers ever receive the reward money?

SDStaff Gfactor replies:

Some people got rewards and some didn't. In a March 2004 article entitled "Sniper tipsters get reward of $500,000" in the Washington Times, Tarron Lively reported, "Robert Holmes of Tacoma, Washington, will get $350,000 for first notifying authorities that his friend, John Allen Muhammad, might be the shooter. Whitney Donahue of Greencastle, Pennsylvania, who called authorities when he saw Muhammad's vehicle at a Frederick County, Maryland rest stop in October 2002, will receive $150,000." Why did the tipsters have to wait two years to get their rewards? There were lots of claimants. In a December 2002 USA Today article, Martin Kasindorf reported that the arrest prompted a barrage of calls from people demanding the reward. The police had to "decide which of the 67,000 tips is worth money." He also pointed out that it could hurt the credibility of a witness at trial if it came out that the witness received a reward.

Offering rewards or bounties for help capturing criminals and the problems thereby created date back to the Roman Empire. Tacitus wrote:

The rewards of the informers were no less odious than their crimes; for while some seized on consulships and priestly offices, as their share of the spoil, others on procuratorships, and posts of more confidential authority, they robbed and ruined in every direction amid universal hatred and terror. Slaves were bribed to turn against their masters, and freedmen to betray their patrons; and those who had not an enemy were destroyed by friends. [Thanks to Straight Dope Message Board member Helen's Eidolon for directing me to Tacitus.]

And of course there's the Judas thing.

Offering rewards for turning in criminals was tried in England toward the end of the 1600s. "Thief-takers" were a combination of snitch and bounty hunter – they got a reward for handing over the crooks and often testifying against them. Tim Hitchcock and Robert Shoemaker tell us on the oldbaileyonline.org website that thief-takers were common from the late seventeenth century in England:

Concern about high levels of crime in London in the late seventeenth century led the government to adopt the practice of offering substantial rewards for apprehending and convicting those guilty of specific serious crimes, such as highway robbery and coining. This practice expanded in the eighteenth century, and was supplemented by individual victims of crime who offered rewards for the return of their stolen goods. Both practices were facilitated by the advent of daily newspapers in the early eighteenth century, which allowed information about such rewards to be widely distributed in advertisements.

The potential for abuse was great. Hitchcock and Shoemaker point out that many thief-takers blackmailed known criminals; some even became "thief-makers," encouraging the easily led to commit crimes so the the thief-taker could collect a reward for turning them in.

As you can see from the historical examples, paying for information about crimes often leads to trouble. To this day experts disagree about whether rewards are worth the cost. Some complain they increase the number of bad tips and produce sketchy eyewitness testimony. Nevertheless they continue to be offered – but are they paid? Not as often as you might think, according to an April 2003 article by Timothy Maier in Insight on the News.

The basic law on rewards is clear – they're contracts. You might not be familiar with this kind of contract, but it's not new. There are two kinds of contracts: bilateral (in which a promise is exchanged for a promise) and unilateral (in which a promise is exchanged for an act). A famous U.K. case involving a unilateral contract is Carlill v Carbolic Smoke Ball Co. (1893). In that case the defendant offered a £100 reward to anyone who purchased and used its special "carbolic smoke ball" as directed and still got the flu. The plaintiff used the ball and got the flu. When she claimed the money, the defendant tried to back out of the deal. The court found the advertisement was a valid offer to enter into a unilateral contract, and that the plaintiff had accepted it by performing the acts requested.

The same law applies to most reward offers. For example, in Newman v. Schiff, infamous tax protester Irwin Schiff appeared on a television show and offered $100,000 to anyone who called the show and cited any section of the Internal Revenue Code "that says an individual is required to file a tax return." Newman missed the broadcast but saw a clip of it on another show. He looked up the statute and demanded the cash. In its ruling the court took the opportunity to scoff at Schiff's tax claim:

Schiff's claim that there is nothing in the Internal Revenue Code that requires an individual to file a federal income return demands comment. The kindest thing that can be said about Schiff's promotion of this idea is that he is grossly mistaken or a mere pretender to knowledge in income taxation. We have nothing but praise for Mr. Newman's efforts which have helped bring this to light.

The court found that Schiff's statement "constituted a valid offer for a reward. In our view, if anyone had called the show and cited the code sections that Newman produced, a contract would have been formed and Schiff would have been obligated to pay the $100,000 reward, for his bluff would have been properly called." The court ruled against Newman, though, because he hadn't called the show (he wrote a letter). This ruling demonstrates an important feature of unilateral contracts: The offeror gets to spell out how the offer can be accepted. If the person seeking the reward doesn't comply with all the requirements, he gets bupkes.

In another case, Rudy Turilli, operator of the "Jesse James Museum," offered $10,000 to anyone who could disprove his contention that Jesse James was not murdered in 1882, but in fact lived for many years thereafter under the alias J. Frank Dalton and resided with Turilli at his museum into the 1950s. Stella James, a relative of Jesse James, accepted the challenge and produced affidavits of persons who had identified Jesse James' body after the 1882 shooting. Turilli denied the evidence satisfied the requisite degree of proof and refused to pay the $10,000. He had to pay after a court found that Stella James only needed to submit evidence sufficient to persuade an ordinary person.

How do the authorities avoid paying rewards? One way is that, as we saw in the Schiff case, those seeking a reward must meet the precise conditions of the offer. Sometimes the rules get very specific about forms and deadlines and the like. Those denied often argue that the rules are needlessly complex or even contradictory.

Reward offers frequently give the offering agency wide discretion in deciding who qualifies for a reward. Often law enforcement agencies claim their own investigative work broke the case, even though they may have received useful tips from reward seekers. Other informants have been turned down because they turned the bad guy in for the wrong crime.

Another catch is that many of the offers give the agency complete discretion to grant or deny a reward. IRS publication 733, for example, says "The Area Director will determine whether we will pay a reward and its amount." While the rest of the form spells out how the IRS will decide whether and how much, courts have held that the reward advertisement is not an offer. In an article called, "Snitching for Dollars: the Economics and Public Policy of Federal Civil Bounty Programs," Ferziger and Currell discuss two cases, Barker v. Lien and Merrick v. United States. In Barker the First Circuit held that a contract between an informant and an IRS agent was not a waiver of the government's immunity from suit. In other words, even though there might have been a valid contract, Barker couldn't sue the government for violating it because a lowly IRS agent lacks the authority to waive immunity. The court said only the district director has the authority to bind the IRS in such matters.

In Merrick, the IRS district director for Los Angeles told Robert Merrick that he would be rewarded for information regarding illegal tax shelters, and his reward would be calculated according to IRS Publication 733. The Federal Circuit said that this promise was enforceable against the government and sent the case back to the district court for trial.

But getting into court is only the first hurdle, as Ferziger and Currell note:

The IRS, however, usually manages to get the last laugh if it so desires. The informant's lawyer in the Stack [a case where the court rejected the government's sovereign immunity argument because Stack had a binding contract] case was not nearly clever enough. An early draft of the contract stated that Stack would be paid five percent of the IRS's tax recovery, but the final draft only provided "up to five percent." The IRS, careful to pay within the literal terms of the contract, gave Stack 0.2%.

Maier writes:

The U.S. Rewards for Justice Program is fond of finding ways not to pay. It claims to have paid out $9.5 million to 23 tipsters in the last decade, but do the math. That comes to about two people per year who were paid. And most of the time some of the money is withheld, Geis [criminology professor at the University of California-Irvine] says, because the value of a tip leading to arrest and conviction is regarded as discretionary. "Rarely do you see that one lump-sum payment," he adds.

Add in the difficulty of suing the government in the first place and you begin to see why many rewards go unpaid.

Most courts say reward claims against the U.S. must be initiated under the Contract Disputes Act. The act imposes requirements that don't apply to other contract claims. Example: In Goodin v. United States Postal Inspection Service, postal inspectors offered a reward for for information leading to the arrest and conviction of the perpetrator of a string of bank robberies. Goodin showed the offer to Lien; both thought they recognized the suspect and notified the postal people separately. The robber was caught and convicted. Both claimed the reward. Lien got $5000; Goodin got zilch. Why? "Her application was incomplete because it lacked a required personal history form and photograph," according to the investigative service. Goodin denied it and sought her day in court. Her lawyer sued in federal court in Minnesota, where she lived. The court held that under the CDA she was required to file her case either with the Postal Service Board of Contract Appeals (how friendly does that sound?) or the Court of Federal Claims, both of which are in Washington D.C. As we have seen, even if she filed in the right place, she'd probably have lost.

What about reward offers from other countries? In Guevara v. Republic of Peru the Eleventh Circuit Court of Appeals held that suits to recover rewards against other countries aren't barred by the Foreign Sovereign Immunities Act. So you can successfully sue a foreign country in a U.S. court to recover a reward. But good luck collecting.

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Staff Reports are written by the Straight Dope Science Advisory Board, Cecil's online auxiliary. Though the SDSAB does its best, these columns are edited by Ed Zotti, not Cecil, so accuracywise you'd better keep your fingers crossed.


Beattie, J.M., Policing and Punishment in London, 1660-1750 (2001)

Carlill vs. Carbolic Smoke Ball Company, UK Law Online: http://www.leeds.ac.uk/law/hamlyn/carlill.htm

Dalrymple, Mark, The Law and Practice of Rewards to Recover Stolen Art, AXA Art Conference, November 2005: http://www.axa-art.co.uk/sps/mark_dalrymple.pdf

Ferziger, Marsha & Currell, David, "Snitching for Dollars: the Economics and Public Policy of Federal Civil Bounty Programs," 1999 U. Ill. L. Rev. 1141 (1999)

Guevara v. Republic of Peru, 468 F.3d 1289, 1305 (11th Cir. 2006): http://caselaw.lp.findlaw.com/data2/circs/11th/0516235p.pdf

Hay, Douglas & Snyder, Francis, eds., Policing and Prosecution in Britain 1750-1850 (1989)

Kasindorf, Martin, "Clamor for Sniper Reward Rising," USA Today.com, December 1, 2002: http://www.usatoday.com/news/nation/2002-12-01-sniper-reward-usat_x.htm

Krug v. United States, 168 F.3d 1307, 1310 (Fed. Cir. 1999): http://caselaw.lp.findlaw.com/cgi-bin/getcase.pl?court=fed&navby=case&no=985130

Lerner, Pablo, "Promises of Rewards in a Comparative Perspective," 10 Ann. Surv. Int'l & Comp. L. 53 (2004)

Lively, Tarron, "Sniper Tipsters Get Reward of $500,000," Washington Times, March 21, 2004: http://www.washtimes.com/metro/20040320-115329-1257r.htm

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Maier, Timothy, "Reward Not Paid: Authorities Regularly Offer Financial Incentives for Tips That Lead to a Crime Being Solved, but Criminologists Claim Large Payouts are Rare," Insight on the News, April 1, 2003: http://findarticles.com/p/articles/mi_m1571/is_8_19/ai_100111642/pg_1

"Montgomery County Holds News Conference" (transcript), CNN Transcripts, November 26, 2002: http://transcripts.cnn.com/TRANSCRIPTS/0211/26/se.04.html

"Policing in London before the Bobbies – How Suspects were Apprehended," The Proceedings of the Old Bailey, 2003: http://www.oldbaileyonline.org/history/crime/policing.html#thief-takerstext

Whitelaw, Kevin, "Just a Phone Call Away: U.S. Officials Pay Out Millions to Tipsters for Help Finding Terrorists," U.S. News & World Report, January 31, 2005: http://www.usnews.com/usnews/news/articles/050131/31terror.htm

"Who Gets The Sniper Reward?" CBSNews.com, October 25, 2002: http://www.cbsnews.com/stories/2002/10/25/national/main526951.shtml

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