Phillips & Cohen partner Erika Kelton explains in a FT Adviser article why the UK Financial Conduct Authority is seeing fewer whistleblower reports than in prior years while US whistleblower programs continue to flourish.
Erika Kelton, a partner at the US whistleblower law firm Phillps & Cohen, said it was no surprise that the number of whistleblowers who have filed reports with the Financial Conduct Authority has dropped over the past two years.
She said the program was not set up for success.
Ms Kelton said: “The FCA should be concerned about a precipitous fall in whistleblower reports over two years, particularly when compared to the overwhelming success of the whistleblower program at the US Securities and Exchange Commission.
“During the period when the FCA saw a dramatic drop in whistleblower reports, the number of SEC whistleblower tips increased from 3,620 in 2014 to 3,923 in 2015 and to 4,218 in 2016. Even more importantly, whistleblower information has led to the recovery of nearly $1bn (£774m) in disgorgement and fines from wrongdoers.
“There is a key difference between the FCA’s and the SEC’s whistleblower programs that explains why their results have diverged. Quite simply, the SEC’s program is so successful because whistleblowers are entitled to financial rewards when their information and assistance leads to a successful enforcement action that recovers more than $1m (£774,634).