The Financial Conduct Authority (FCA) has said it will look to strengthen its internal whistleblowing policy after intense criticism over its handling of complaints from former staff.
The City regulator said today it will clearly lay out how its chair and other non-executives can internally share information about whistleblowers in order to protect their confidentiality and anonymity.
It builds on recommendations from an internal review conducted by FCA senior independent director, Richard Lloyd, over the handling of two internal complaints by chair Ashley Alder.
While the review ultimately cleared Alder of wrongdoing, he faced backlash and calls to resign after forwarding on confidential emails to staff. The FCA admitted he “did not follow our existing policy to the letter”.
In a statement today, the regulator argued its “strengthened” policy will be “easier for our people to use”, including by clarifying different channels staff can use to report grievances, how former employees are affected and what they can expect from raising concerns.
“We’re committed to a culture where people are confident to raise concerns and challenge poor practice and behaviour,” the regulator said.
Lloyd recommended the FCA strengthen its policy by clarifying that in rare cases when whistleblowing is escalated to non-executives, “communications will need to be shared with appropriate internal or external expert advisers on a confidential ‘need to know’ basis so they can be reviewed fully”.
More recently, a group of MPs said on Tuesday that the FCA’s treatment of both internal and external whistleblowers was “alarming”.
The scathing report, which branded the regulator “incompotent”, included accusations from whistleblowers that the FCA “fails properly to investigate and act on intelligence provided, and that fails to protect – and in some cases, actively harms – those who provide such information”.
The policy review began in March and has involved several stakeholders, including whistleblowing charity Protect.
A source close to the regulator said the changes are also intended to reflect new working from home habits and how types of complaints have changed since the policy was written a decade ago.
The FCA received 322 external whistleblower reports between July and September, the highest quarterly number since it began tracking the figures four years ago and up from 253 during the previous three months.