Blowing the whistle on bad conduct

There are increased noise levels of late coming out of the FCA.

• First the news earlier this month that NatWest is being prosecuted for AML failings, and now a new campaign to encourage whistleblowing in UK financial services firms. “We listen to all whistleblowers, and if they shine a light on serious misconduct, we want to make sure we act responsibly” said Mark Steward, Executive Director of Enforcement and Market Oversight at the FCA.
• The FCA has stressed at length the confidentially that can accompany any whistleblowing.  Looking ahead, and maybe with an eye on being busy, the FCA has increased the headcount of its whistleblowing team. The question that many are asking is whether the FCA will consider financial reward for someone blowing the whistle.
• In the US, the SEC has generously rewarded whistleblowers since starting its own programme in 2012.  Only last October, a record $114m was paid to one whistleblower who tipped-off the government on misconduct.   Awards made typically range from 10-30% of any money collected back by the US government.  To-date, approaching $800m has been awarded to whistleblowers in the US.
• Will the success of the FCA programme be impeded by a lack of financial reward or is the UK playing field a different one to that in the US, with financial reward not the motivator to those reporting misconduct?
• The FCA is perhaps re-calibrating and following recent criticism for oversight failures surrounding the mini-bond scandal and eventual £237m collapse of London Capital and Finance (LCF).  Losses were incurred by 11,000 by small investors.
• What is certain, is that the new FCA CEO looks to be keeping firms on their toes into 2021.