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Enhanced Whistleblowing Requirements for The Society of Lloyd's Following PRA Written Notice

Posted on 23 December 2019

The PRA has published a Written Notice setting out concerns regarding The Society of Lloyd's (Lloyd's) whistleblowing systems and controls, and requiring enhanced monitoring and reporting for a period of three years.  

On 15 February 2019, Lloyd's made a voluntary disclosure to the PRA (and the FCA) regarding the operation of an anonymous whistleblowing telephone service, the 'Speaking Up Helpline'.  Whilst there were a number of whistleblowing channels in place for staff, the Speaking Up Helpline was the only anonymous channel.  That service ceased on 1 October 2017 and no new anonymous service was put in place until 22 February 2019 – a period of more than 16 months. Further, following Lloyd's voluntarily disclosure, the FCA asked Lloyd's for a copy of its annual whistleblowing report. No report had been produced. 

The additional requirements were made by way of an application by Lloyd's pursuant to s.55M(5) FSMA 2000. That section provides that an authorised person with a Part 4A permission can apply to the PRA to cancel or vary a requirement, or to impose a new requirement.  For a period of three years, Lloyd's will be required to submit enhanced whistleblowing reports, including details of procedures, training undertaken and also forward looking proposals to ensure future compliance with the relevant rules. Annual attestations from Lloyd's Whistleblowers' Champion confirming compliance with the enhanced obligations will also be required.

Comment

Increased accountability in respect of Whistleblowing was a key focus of the changes introduced by SMCR and this is a timely reminder to firms and Whistleblowers' Champions to ensure that they are compliant with the rules. The fact that Lloyd's identified the issue and self-reported, and that there were other (albeit they were not anonymous) whistleblowing channels no doubt played in Lloyd's favour and may have mitigated against formal sanction from the PRA. However, there has as yet been no comment from the FCA. It will be interesting to see what, if any, further action may follow.

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