2,754 Whistleblower Allegations to FCA

The Financial Conduct Authority’s (FCA) recently published Annual Report and Accounts 2020/21 has disclosed that 1,046 individual whistleblower reports made 2,754 allegations of misconduct by regulated financial services firms and individuals in the year.

Mis-conduct allegations are usually for compliance issues i.e. firms or individuals not complying with FCA rules, fraud and money laundering.  Whistleblowers tend to be individuals working within the industry and for many, they are reporting current or former employers for gross mis-conduct.  It is a regulatory requirement that people working within the financial services industry to whistleblow where they believe a firm or individual is involved in mis-conduct and any individual who fails to report alleged mis-conduct can themselves be held to account, disciplined, fined or even ‘struck off’.

1,046 whistleblower reports is down only slightly on the previous year of 1,100 reports but still makes for unpleasant reading.

Last year, the FCA issued fines of £190m.  It also made 15 ‘significant’ intervention actions to stop financial detriment e.g. strike off, prosecution etc. and a further 135 general intervention actions such as warning firms, writing to and visiting firms.  That said, 654 cases are still being investigated and only 97 cases were ‘kicked out’ as not relevant or in need of intervention.

Comment

It is sad to see that so many individuals or firms are not carrying out their regulatory duties of skill, care and due diligence.  We suggest that this may get worse as other areas come on stream within the FCAs remit such as Claims Management Firms, Cryptocurrency Assets and Funeral Plans.

Is it really so difficult for some to not work within FCA rules or work with honesty, integrity and treat their customers fairly?