Overview
(This is a cross-post from Steptoe’s new Investigations and Enforcement Blog.) In May 2020, the U.K. Financial Conduct Authority, the authority charged with regulating financial firms and maintaining the integrity of the financial markets in the United Kingdom, reported that whistleblowing reports to the Financial Conduct Authority on workplace culture issues in 2019 had increased by 35%. There is also evidence of an increase in whistleblowing reports made during the COVID-19 lockdown, with WhistleB, the Swedish-European provider of whistleblowing solutions, reporting an increase of 40% in the number of concerns raised by whistleblowers in Europe from January to May 2020. Similarly, in the United States, the Securities and Exchange Commission (SEC) reported a 35% increase in the number of whistleblower tips, complaints and referrals between mid-March and mid-May 2020. And although the filing of whistleblower complaints (also known as “qui tam” complaints) are reported to be down compared to the same time last year, the recent distribution of billions of dollars in federal money to companies (discussed further below) is sure to reverse that trend. Given the inevitable increase in whistleblower reports, companies are well-advised to begin to consider their policies and procedures for dealing with them. As with almost every claim, it is imperative that whistleblower reports are dealt with in a considered and deliberate manner. A failure to deal with a report, or a failure to deal with it adequately, will almost certainly make the situation worse (including, if relevant, the risk of reports to regulators or the press with the resultant risk to the company’s reputation and ongoing business) and compound the harm. Click here to read about steps a company may wish to consider in handling whistleblower reports on the Steptoe Investigations and Enforcement Blog.
