On 24 March, the FCA launched a new campaign to encourage individuals working in financial services to report potential wrongdoing to the FCA. The FCA seeks to encourage reports by whistleblowers by emphasising the support available to them across the FCA's departments. Executive Director of Enforcement and Market Oversight, Mark Steward said:
"We want all whistleblowers to feel welcomed by us and to feel safe because of us. We listen to all whistleblowers and, if they shine a light on serious misconduct, we want to make sure we act responsibly. When whistleblowing works well it helps consumers, markets and firms and keeps everyone safe and that is our aim".
The FCA has emphasised that it is prepared to receive reports from whistleblowers on an anonymous basis. Alternatively, where a whistleblower elects to share their identity, the FCA will guarantee protection of their identity, including in the course of a subsequent investigation if that is the result of the report by a whistleblower.
Firms are already required under FCA rules to have effective arrangements in place for employees to raise concerns and to handle any concerns that are raised appropriately. The FCA has indicated that it will be issuing firms with materials about the campaign, to share with individuals, and that it will be promoting the campaign at industry events.
The announcement of the FCA's campaign is a timely reminder for firms to review their whistleblowing policies and procedures to ensure that they are effective and appropriate. The FCA has emphasised that culture and governance remain a key priority. Firms should ensure that a commitment to compliance is observed and understood throughout the business. That means having appropriate policies and procedures in place, training staff on the policies, demonstrating a clear top-down commitment to compliance and monitoring compliance. Any concerns should be addressed appropriately and promptly, on the basis that firms that demonstrate a commitment to compliance and an appropriate response to a compliance failure may receive credit for that in any subsequent FCA investigation.
Any individuals considering the making of a whistleblowing report to the FCA will wish to consider their position carefully. While the FCA has committed to protecting the identity of whistleblowers in any subsequent enforcement action, there are nevertheless important legal considerations for whistleblowers to consider before making a report. If, for instance, a potential whistleblower has had some involvement in the potential misconduct, the FCA's whistleblowing rules will not necessarily protect them from enforcement action themselves. In any case, a potential whistleblower will want to give careful consideration to whether they should seek independent legal advice prior to the making of a report to the FCA.
If you would like to discuss any of the issues raised in this blog, please do not hesitate to contact Paul Marshall, Partner and Head of Corporate Crime and Investigations or any other member of the Corporate Crime and Investigations Team.