The PRA and FCA have both published new rules on whistleblowing, namely:
- PRA Policy Statement 24/15: Whistleblowing in deposit-takers, PRA-designated investment firms and insurers (PS24/15) and Supervisory Statement (SS39/15); and
- FCA Policy Statement 15/24: Whistleblowing in deposit-takers, PRA-designated investment firms and insurers (PS15/24).
In PS24/15 the PRA provides feedback on the responses to an earlier joint consultation paper with the FCA and publishes the final rules. The PRA notes that although there have been proposals that have changed due to the consultation responses, most of the proposals were broadly supported by respondents, and as such, the changes are relatively minor and mainly seek to offer clarifications as to the intent of the policy.
The PRA will, therefore, take forward requirements that:
- firms establish internal whistleblowing channels and inform their staff about these arrangements;
- firms inform their staff about the whistleblowing services of the PRA and the FCA, as well as informing them of the legal protections offered under the Public Interest Disclosure Act 1998; and
- wording in employment contracts and settlement agreements should not deter staff from whistleblowing.
In SS39/15 the PRA sets out its expectations in relation to:
- whistleblowing procedures;
- settlement agreements; and
- whistleblowers’ champion.
In PS15/24 the FCA also provides feedback on the responses to the joint consultation paper and sets out a package of final rules designed to build on and formalise the good practice already widespread in the financial services industry. The final rules aim to encourage a culture where individuals feel able to raise concerns and challenge poor practice and behaviour. The FCA notes that the new key rules on whistleblowing will 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 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; and
- require its appointed representatives and tied agents to tell their UK-based employees about the FCA whistleblowing service.
The final rules in PS24/15 and PS15/24 will come into force on 7 September 2016. The requirement to assign responsibilities to a whistleblowers’ champion will take effect on the same date as the rest of the Senior Managers Regime, 7 March 2016.
The FCA also notes that it will consult on applying these rules to UK branches of overseas banks. Additionally, once the rules have been in effect long enough to assess their effectiveness, the FCA will consider whether similar requirements should be applied more widely to other firms it regulate, such as stockbrokers, mortgage brokers, insurance brokers, investment firms and consumer credit firms.
View FCA introduces new rules on whistleblowing, 6 October 2015