The Financial Times has reported that a Freedom of Information Act request from accountancy firm BDO has revealed that the number of whistleblowing complaints to the FCA increased by 24% in 2018. Of this, there was an increase of 232% for complaints relating to treating customers fairly.
This increase has coincided with the introduction of the Senior Managers and Certification Regime (SM&CR) within the financial sector. As SM&CR will be extended to solo-regulated firms, including insurance brokers, from December 2019, one can only assume that whistleblowing complaints will continue to increase.
It should be noted that, despite these complaints (1,755 in 2018), the FCA has acted on only 121 disclosures.
One example highlighted by the Financial Times is the ongoing investigation by the FCA into the Royal Bank of Canada’s working culture in its London office following dozens of complaints to the regulator about staff treatment.
This supports the current output and thinking from the regulator that SM&CR’s core objectives will challenge firms to display an increased standard of governance, promote a culture of accountability and transparency, and embed values grounded in the fair treatment of both employees and customers.
With December 2019 moving ever closer, we urge all our clients to start thinking about their preparations for SM&CR now. As always, RWA is on hand to assist.