The FSA’s promotions team has reported that over 80 per cent of reports of non-compliant advertisements are coming from regulated firms and that there is some ‘internal whistleblowing’ occurring.
The latest Association of Mortgage Intermediaries (AMI) newsletter details that the regulator is keen to investigate this whistleblowing further as it is a clear indicator of failings in the firm’s own management and controls where the employees are not raising these issues with their own management.
Robin Gordon-Walker, spokesman for the FSA, said: “We have a ‘whistleblower’ hotline and have received some tip-offs directly connected to Financial Promotions. It helps to pick up information from internal sources as it aids us in getting to the root of the problem faster. We would then contact the firm in order to get their promotional material corrected.”
Julian Wells, head of marketing at Mortgages plc, said: “This is the most alarming development yet. First we had firms complaining about other firms and now we have ‘whistleblowing’.
“It just confirms that there is a huge problem with Financial Promotions at the moment. For a firm to be reported to the FSA by its own staff has to show that there is a major concern.”
Kevin Morgan, managing director of Consilium Financial Planning, commented: “It’s rather unfortunate that companies aren’t being compliant in the first place. This ‘whistleblowing’ smacks of other grievances.
“It indicates these individuals may have a problem with their company. Also, it’s not clear how many cases of whistleblowing there has been. It might only be one or two.”
