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Britain should break a “long-standing antipathy” to paying whistleblowers to reduce economic crime and prevent hundreds of Brits from taking information to the US, the Royal Services Institute said. Ta.
The launch of an effective whistleblower payments program could play a “vital role” in reducing white-collar crime, a defense and security think tank has found, adding that the UK should not be forced to implement such a scheme. The Serious Fraud Office’s request to consider the matter has become even more important.
“If you have an insider who can provide emails and provide evidence, that changes things,” Rusi’s Eliza Lockhart told the Financial Times.
“But that means we need to get over the idea that whistleblowers are going to be some kind of moral hero that we gloss over,” she added. “Such a perception does not help the investigation and is unfair to the whistleblower.”
Britain’s financial regulator considered paying for information a decade ago in the wake of the 2008 financial crisis, but concluded such a system was unnecessary.
Information from Britain is one of the largest sources of information from outside the United States for the U.S. Securities and Exchange Commission, which has been paying informants since 2011. Last year, the US market watchdog awarded $279 million to whistleblowers, the largest amount in history. payment.
Still, only 0.5% of whistleblowers who contact the SEC receive financial compensation, and contrary to the perception that millions of dollars from these programs are common, Lockhart said.
Rusi’s research, funded by the Serious Organized Crime and Anti-Corruption Evidence Research Program, examined plans in the United States and Canada and found that formal programs also require better protection for handling such information. We concluded that it provides. The informant took advantage of it.
“Money is important, but protection, the idea of actually being actively protected, seems to be one of the key drivers, anecdotally from the United States,” Lockhart said.
He said the establishment of a whistleblower office to coordinate payment plans is essential to the program’s success. The organization may also focus on the quality of information provided, rather than the motivations for individuals to report, Luci said.
While the program could create a cottage industry of lawyers pursuing these cases, research shows that the United States actually benefits from a system that prevents advance payments and increases the likelihood that lawyers will come forward. It turned out.
Nick Ephgrave, director of the SFO, who has publicly backed the plan, said: “We hope to see the UK move to a model where financial incentives are available to encourage whistleblowers to come forward.”
He added: “Since 2012, there has been an increasing trend of UK whistleblowers working with US law enforcement, and there are some effective incentive schemes in the US. The UK system has changed. This would result in these individuals being reported to UK authorities, increasing the detection and prosecution of economic crimes here.
The UK already has some whistleblower payment schemes in place. The Competition and Markets Authority is offering rewards of up to £250,000 for information about illegal cartels, up from £100,000 last year, while HM Revenue and Customs can also pay out to whistleblowers.
Nikhil Rati, director of the Financial Conduct Authority, said it would be “deeply counter-cultural” for the UK to pay as much as the US for information, but would reward those who come forward. He said he was “fundamentally not opposed” to the idea. .
“We rely on whistleblowers as a key source of evidence in all our work, particularly our oversight and enforcement work, and we remain focused on how we can build confidence in our whistleblowing infrastructure here in the UK. We want to focus on that,” Rati told the FT.
But last month, the watchdog was criticized for its “alarming” treatment of domestic and foreign whistleblowers in a damning report released by MPs.
Earlier this year, FCA chairman Ashley Alder was also found to have broken its own rules after sharing within the company the identities of two former whistleblower employees.