The City Watchdog should apologise to a whistleblower it named to the Royal Bank of Scotland, according to a review by the Complaints Commission today.
The Financial Conduct Authority (FCA) named Mark Wright, an RBS employee and whistleblower, after he approached them with a query in 2013.
Wright asked if the regulator had been notified of his whistleblowing while at the bank, where he worked for 25 years, and whether RBS sought advice over various issues he raised including tampering with customer files.
We exclusively covered the story of Mark Wright last year.
Internal emails show the FCA were considering Wright as a whistleblower. Further, Wright’s MP Norman Lamb had written to the FCA regarding his constituent’s case, highlighting that he was vulnerable. Wright was signed off work in 2012 owing to ill health which started after he raised a complaint at RBS.
Yet the FCA later said it was ‘necessary’ to name Wright to the bank regarding his query, and as he had not requested anonymity, and his MP had referred to him by name, the regulator assumed it was okay to proceed without confidentiality.
The Complaints Commission found these explanations to be ‘unconvincing.’ The regulator did not ‘demonstrate sufficient emphasis on the importance of considering the confidentiality of potential whistleblowers,’ the decision says. The Complaints Commission recommends an apology to Mark Wright for subsequent justifications of the breach and the denial of wrongdoing, which forced the case to go on longer than it should have.
Norman Lamb MP said in response to the decision:
“It is particularly disturbing that the FCA failed to recognise their serious failure when challenged and then chose to fight on, resisting the complaint to the Complaints Commissioner right up to the last minute. The Complaints Commissioner has made his view of their conduct very clear.”
As a result of the Complaints Commission decision today, the FCA have ‘adopted a new step’ which explicitly asks potential whistleblowers about protection they need and ‘how they wish to be treated.’ This will be used to manage cases brought to the regulator from now on, a move welcomed by the Complaints Commission.
Bank Confidential
Whistleblower Mark Wright said the decision is a ‘good start’ for his new organisation Bank Confidential, which launched this week and aims to help and protect other whistleblowers.
“In deciding to set up Bank Confidential, it was important to me to offer the right support and expertise to protect financial services staff, so my experience can never happen again,‘ says Wright.
‘Whistleblowers are already being targeted and silenced by the banks they are whistleblowing about. It’s shocking that the regulator would act this way, and cover up significant disclosures that are very much in the public interest.’
Bank Confidential hope to push for reforms which protect whistleblowers. Norman Lamb MP is a patron of the organisation. He said:
“This case highlights the need for urgent reform in the treatment of whistleblowers. Mark Wright has lost his career and his health as a result of trying to do the right thing. Instead he and other whistleblowers should be treated as brave heroes. They should have a statutory right to anonymity and should be rewarded, rather than punished, for acting bravely to expose wrongdoing – just as in the US.”
Wright adds, ‘There’s much more to come from Bank Confidential in the next few months.’
FCA and the GRG
The decision comes amidst a fraught few months for the FCA, following its handling of the RBS Global Restructuring Group (GRG) case – a turnaround unit that asset stripped small businesses and sent many into bankruptcy as a result of increased fees or deliberate pressure from the bank.
The FCA refused to publish its full review into GRG, despite initially planning to do so. The regulator was also accused of whitewashing the summary, after the review was leaked to the BBC. It found 92% of businesses that entered GRG were mistreated.
It was later revealed the regulator feared legal action by RBS had it published the report, drawing criticism over the FCA’s ability to regulate the financial sector.
A Parliamentary debate on RBS GRG is scheduled for Thursday.
