New whistleblowing rules published by the Financial Conduct Authority (FCA) don’t go far enough to protect potential whistleblowers, a City law firm is claiming.
The Financial Times reports that according to Omar Qureshi, partner at CMS, the FCA will have to go further if it wants to emulate the success of its US counterpart, the Securities and Exchange Commission, which offers financial rewards to potential whistleblowers for information on wrongdoing.
Earlier this month the FCA and the Prudential Regulation Authority at the Bank of England (PRA) published new rules on whistleblowing, which are due to come into force next year. The rules will demand that firms make reporting channels known to staff, ensure their procedures for dealing with reports are adequate and appoint a whistleblowing ‘champion’ who must produce an annual report on whistleblowing and hand it to the regulator. Unlike the US, the new rules will not offer a financial incentive to whistleblowers.
Levels of whistleblowing in the UK have increased in recent years, but they do not come close to matching figures from the United States, where the image of the corporate whistleblower is often burnished. For example, Time Magazine gave the three women who blew the whistle on US corporate giant Enron in 2002 their prestigious Person of the Year Award.
CMS say that: “The exact role of the whistleblowers’ champion remains undefined and there appears little more by way of incentive for whistleblowers to come forward than there was prior to the rules being published.”
This month’s rules were introduced as a result of recommendations made by the Parliamentary Commission on Banking Standards in 2013.
Read more about the new UK whistleblowing rules here: https://www.hrreview.co.uk/hr-news/employment-law/whistleblowing-rules-toughened-financial-watchdogs/59507