RegulationJun 12 2018

FCA beefs up whistleblowing intelligence team

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FCA beefs up whistleblowing intelligence team

The Financial Conduct Authority (FCA) has increased the resources it allocates to managing and handling complaints from whistleblowers.

Speaking at the FCA's asset management conference in London today (12 June), Christopher Wollard, director of strategy and competition at the regulator, said “the reality is whistleblowers provide some of the best intelligence we get as an organisation".

"But of course we have to be aware of what the motives are that prompt people to be whistleblowers," he added.

In May the FCA fined Barclays CEO Jes Staley an undisclosed sum for a conduct issue that arose following the intervention of a whistleblower.

Mr Staley attempted to identify the author of an anonymous letter received by Barclays in June 2016 that claimed to be from a Barclays shareholder.  The letter contained various allegations, some of which concerned Mr Staley, who then tried to identify the author.  

Mr Woolard declined to comment on the specifics of that case but said the regulator has “put more resource” into whistleblowing, and ensuring those who wish to highlight an issue are supported.

The FCA does not investigate individual complaints from consumers or customers about firms or individuals. 

But according to its website, whistleblowing information has helped it issue fines and warning letters to firms and individuals, vary and withdraw permissions, and other kinds of early involvement like asking firms to change their business activities.

Reports of whistleblowing to the Financial Conduct Authority fell by a fifth for the second year in a row in 2016. Figures published under the Freedom of Information Act last March showed that in 2016 the FCA received 866 reports of wrongdoing to its whistleblowing team.

This was a reduction of a fifth in the number of reports received during 2015, when 1,105 were made to the FCA.

The number for 2015 was in itself a reduction from 2014, when there were 1,367 reports.

The figures also showed 13 per cent of reports to the FCA’s whistleblowing team in 2016 directly contributed to enforcement action or been of “significant value” to the regulator.

During 2016 six reports directly contributed to FCA enforcement action while 108 were deemed to be of “significant value”.

Mr Woolard also commented on the issue of diversity in the asset management sector, saying firms must ensure they have a diversity of voices and people of different backgrounds represented in the decision making process.

A workplace can have a group of employees that “look differently” to each other, and this is important, but that if people have similar backgrounds to each other, then the issue of diversity is not being solved, he told delegates.