06 Sep 2016 | 11:09 am | 2 min. read
Figures from the financial services watchdog saw a 19% drop in the number of whistleblowing reports received in 2015, despite the introduction of new whistleblowing procedures from the FCA.
Research obtained by international law firm Pinsent Masons from the Financial Conduct Authority (FCA), show that 1,104 whistleblowing cases were created in 2015, down from 1,367 in 2014, representing a drop of nearly a fifth.
Michael Ruck, a senior financial services enforcement lawyer at Pinsent Masons and formerly with the FCA said:
"These figures demonstrate the clear need for a culture shift across financial services. Since the FCA announced new rules in 2015, we are yet to see much of a shift to an environment in which individuals feel confident to report bad behaviour. Instead, financial institutions are finding an increased interest from employees around their responsibilities and ownership with many escalating concerns internally on a defensive basis."
FCA whistleblowing rules – to be fully implemented in line with the Senior Managers' Regime (SMR) – have been introduced to encourage whistleblowing. Part of the aim of the rules was to assign responsibilities to a 'whistleblowers' champion' to put systems in place that create the right internal culture and environment. This requirement comes into effect on 7 September 2016.
The introduction of a whistleblowers' champion is to increase accountability and encourage a culture in which individuals feel comfortable raising concerns and challenging poor practice and behaviour. With the deadline to comply with the requirements drawing nearer; applicable firms need to have mechanisms in place to allow their employees to raise concerns internally.
The role of the whistleblowers' champion is to:
"Senior managers' decisions are in danger of becoming based on personal interest and liberty rather than applying a risk based approach. To encourage an increase in whistleblowing reports, there is a clear need for whistleblowers' champions to follow the approach outlined; to avoid such a defensive practice which will only further worsen with the fast approaching implementation of new whistleblowing requirements," comments Michael Ruck.
Whilst both regulators and banks alike are in the early stages of finding their feet in how to deal with and manage the all aspects of the SMR, such effects are already beginning to show. FCA research conducted in August 2016 showed that c. 132,000 people are on the Financial Services Register following the introduction of the SMR, 35,000 less than prior to the SMR requirements being introduced in March.
Michael Ruck adds: "Whether this reduction is entirely a direct result of the SMR is open to debate but is a clear indication of individuals with senior management responsibilities taking the decision to terminate their roles in financial services firms, many of whom took the decision in light of the additional requirements and responsibilities under the SMR."
Multinational law firm Pinsent Masons has advised Tokai Carbon Co., Ltd. (“Tokai Carbon”) on the sale of its German subsidiary TOKAI ERFTCARBON GmbH (“TEG”), to Lenbach Equity Opportunities III. GmbH & Co. KG, which is exclusively advised by DUBAG Investment Advisory GmbH (“DUBAG”).
Multinational law firm Pinsent Masons has advised the shareholders of independent financial advisory and wealth management firm Shackleton, including the private equity buy-and-build specialist Sovereign Capital Partners, on the exit to Lee Equity Partners.
Multinational law firm Pinsent Masons has been announced by Business in the Community as one of The Times Top 50 Employers for Gender Equality in 2025. This year’s list marks the sixth time that the firm has been recognised for its commitment to embedding gender equality into all levels of the organisation.
Multinational law firm Pinsent Masons has advised the shareholders of independent financial advisory and wealth management firm Shackleton, including the private equity buy-and-build specialist Sovereign Capital Partners, on the exit to Lee Equity Partners.
Multinational Law firm Pinsent Masons played a key role in advising the UK-based infrastructure asset manager Dalmore Capital through its acquisition by UK pensions and investment giant Royal London.
Multinational law firm, Pinsent Masons LLP, has advised IGCF VI Euro, L.P. a sub-fund of Balbec Capital LP, a global alternative investment manager headquartered in the United States on its first European public securitisation in relation to the issuance of notes totalling EUR 392 million backed by a portfolio of reperforming Spanish mortgage loans, arranged by Goldman Sachs.
For all media enquiries, including arranging an interview with one of our spokespeople, please contact the press office on
Location contacts
Europe: [email protected]
Asia: [email protected]
Middle East: [email protected]
Australia: [email protected]