Context
The FCA has published the voluntary application by TMK for requirements to be placed on them pursuant to Section 55l (5) and Section 55m (5) of the Financial Services and Markets Act 2000. The requirements relate to potential shortcomings of TMK’s whistleblowing systems and controls.
Key points to note
- Under the agreement TMK must provide a written report to the FCA and PRA outlining the following:
- Steps taken to enhance the awareness of whistleblowing processes and to ensure any barriers to their utilisation are addressed effectively;
- The methodology for assessing the effectiveness of these steps;
- Copies of the firm’s current Whistleblowing Policy relating to making and handling whistleblowing disclosures, including (but not limited to) procedures relating to recognising a whistleblower, maintaining confidentiality (if so requested), engagement with anonymous whistleblowers, record-keeping and measures to avoid actual or perceived whistleblower detriment.
- The FCA considers that the requirement is desirable to advance the FCA’s strategic objective to ensure that the relevant markets function well, and its operational objectives of protecting consumers and protecting and enhancing the integrity of the UK financial system.
- As outlined in the FCA’s ‘Dear CEO’ letter to Chief Executives of wholesale general insurance firms dated 6th January 2020, the FCA expects firms, and senior managers to embed healthy cultures by identifying and modifying key drivers of their culture. The drivers include clarity of purpose, people management, governance and systems and controls. As part of this, the FCA expects firms to have strong whistleblowing processes in place, in line with SYSC 18 requirements of the FCA Handbook.
- TMK will need to submit a yearly report and attestation to both the FCA and PRA.
- TMk will be required to meet the reporting and attestations for a period of three years.