City watchdog receives 518 whistleblowing allegations in Q3
The City watchdog received 518 whistleblowing allegations in the third quarter, with the most common complaint relating to treating customers fairly.
Out of 518 allegations from 289 reports, 79 were on treating customers fairly, 77 were about firms breaking the Financial Services and Markets Act 2000 (FSMA) and 77 were around fitness and propriety. This was followed by 42 allegations relating to the culture of the organisation, 34 were about compliance and 33 on fraud.
The Financial Conduct Authority (FCA) received 123 whistleblowing allegations in July, then this rose to 154 in August before falling to 141 in September.
Complaints around FSMA saw the largest monthly fall from 31 in August to 23 in September, while allegations of whistleblower detriment increased from five to 11.
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“Our whistleblowing team receives reports about alleged wrongdoing in the areas of financial services that fall within our remit,” the FCA said on its website.
“We assess every whistleblowing case we receive, to inform the work we do and to help us to identify actual or potential harm that has arisen or could arise. This could be harm to consumers, to markets, to the UK economy or to wider society.
“Deciding to blow the whistle is a brave act and we greatly value the information we receive from whistleblowers.”
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“The FCA wants to encourage whistleblowing, having learned its lesson over London & Capital Finance,” said Simon Morris, a financial services partner at law firm CMS.
“From a firm’s perspective a whistleblower can be lethal; they don’t always possess the full facts and can be pursuing a personal agenda.
“Many recent FCA investigations have been kicked off by an anonymous whistleblower, and it’s difficult for a firm to extract itself from the FCA’s clutches once its interest has been excited by a whistleblower’s sometimes lurid allegations.
“Whistleblowers thrive where they think they’re being ignored, so the best way for firms to handle this risk is to encourage a speak-out culture where concerns are quickly raised to senior management and rapidly addressed.”
In March, the FCA launched a campaign to encourage more whistleblowers to report wrongdoings.