UK Introduces New Whistleblower Rules for Banking and Insurance Sector Companies
On Tuesday, October 6, 2015, the Financial Conduct Authority (“FCA”) released new whistleblower rules for the UK banking and insurance sector in an effort to protect whistleblowers and encourage them to come forward and voice their concerns.
The FCA said the new rules will take full effect in September 2016.
The whistleblower rules apply to deposit-takers (banks, building societies, credit unions) with assets of £250 million ($382 million) or more, and to regulated insurance companies.
The FCA stated that for all other firms supervised by them, the rules are "non-binding guidance.”
The FCA also stated that "These rules aim to encourage a culture in which individuals working in the industry feel comfortable raising concerns and challenge poor practice and behavior.
The new rules on whistleblowing require a firm to:
• Appoint a senior manager as their whistleblowers’ champion
• Put in place internal whistleblowing arrangements able to handle all types of disclosure from all types of person
• Put text in settlement agreements explaining that workers have a legal right to blow the whistle
• Tell UK-based employees about the FCA and PRA (Prudential Regulation Authority) whistleblowing services
• Present a report on whistleblowing to the board at least annually
• Inform the FCA if it loses an employment tribunal with a whistleblower
• Require its appointed representatives and tied agents to tell their UK-based employees about the FCA whistleblowing service
The FCA said that it has seen an increase in the number of reports it receives. For the financial year 2014/15, the FCA received 1,340 whistleblower complaints, which was a 28% increase over the prior year and almost 10 times the number of complaints received in financial year 2007/08, when it received only 138 whistleblower complaints.
FCA whistleblower rules can be found at http://www.fca.org.uk/news/fca-introduces-new-rules-on-whistleblowing