UK Whistleblowing Updates

• With the Employment Rights Act 2025 increasing whistleblowing protections for those raising concerns about sexual harassment, and with new FCA rules and guidance coming into force relating to non-financial misconduct more broadly, firms must ensure that they have appropriate policies and procedures in place to reflect the new requirements and should prepare to respond to whistleblowing complaints accordingly.
• FCA data relating to how the regulator deals with whistleblowing appears to be improving, but delays still seem to persist.
• “Bounties” for whistleblowers remain absent from the FCA regime. However, they are offered by other UK authorities and the government has confirmed that it is exploring incentivisation of whistleblowers in economic crimes. Following the Budget in 2025, HMRC introduced a “Strengthened Reward Scheme” for individuals who report serious tax avoidance or evasion. Under this Scheme, whistleblowers may be entitled to a reward of between 15% and 30% if HMRC succeeds at recovering at least £1.5 million in tax. The SFO’s approach remains under consideration.

1.  Background

Under Part IVA of the Employment Rights Act 1996 (here), “protected disclosures”– which is the UK legislative term for “whistleblowing reports”can be made either to an employer or to certain “prescribed persons”. For those working in the financial services sector, for example, the UK Financial Conduct Authority (FCA) is a prescribed person.

As discussed in a prior alert (here), a survey of people who had made protected disclosures to the FCA indicated significant concerns about the process and the FCA’s response to whistleblowing allegations. The responses were taking a long time to resolve and most whistleblowers were “extremely or somewhat dissatisfied” with the regulator’s actions. The FCA appeared to take this feedback on board, recognising that more needed to be done, and stating its intent to improve the whistleblowing regime. The regulator has stressed the important role that whistleblowers play in the regulatory system and emphasised its commitment to protecting them.¹

2.  The FCA Data

Since 2023, there has been a steady increase in the number of whistleblowing allegations² made to the FCA. Indeed, in the first three quarters of 2025 there were more allegations raised than in the whole of 2024.³ Around half of these reports were submitted through the FCA’s online reporting webform, with email and telephone combined accounting for the bulk of the remainder of the reports. The subject matter of the allegations has remained largely consistent, with the top three topics for allegations in recent years raising issues concerning “compliance” “fitness and propriety” and “culture of the organisation”.⁴

“Compliance” is obviously extremely broad, and it is hard to pinpoint exactly what these reports would entail. Fitness and propriety and the culture of the organisation are much more understandable, however, and it is perhaps no surprise that these are the sorts of issues where whistleblowers are most active.

The “Consumer Duty”⁵ as new Principle 12 of the FCA’s Principles for Businesses, was introduced in July 2023. Whistleblowing allegations relating to the Consumer Duty surged in 2025, with 336 in total as against 155 in 2024.⁶ Whilst some of this increase may be a result of how the FCA has internally classified the allegations, the change in figures is stark.

The FCA has only published quarterly data on how it has closed reports since 2024. The numbers hold fairly steady, with a range of 253 to 530 a quarter,⁷ with most quarters hovering around the 350-380 mark. Noting that the FCA is receiving in this period approximately 300 reports a quarter, this would suggest that there is a net effect of more cases being closed than opened, hopefully reducing the backlog. It is notable that only a very small proportion of the cases closed have led to what the FCA describes as “significant action to manage harm”: for example, only nine out of 282 in Q4 2025 and 19 out of 356 in Q3 2025. This said, a much higher proportion have resulted in “action to reduce harm” in each case, with between 34% and 55% of cases closed leading to this outcome. Examples given by the FCA of action taken included requiring section 166 skilled persons reviews, engagement with the supervisory team, and information and documentation requests.

One area where the FCA set out to improve following the survey results (see above) was to provide whistleblowers with more detail on what has been done with the information provided. The regulator appears to have made positive strides here, with the FCA now providing detailed feedback letters upon case closure where it is possible to do so. The letters are said to set out the steps taken by the FCA (if deemed appropriate), in response to the reported concerns.

3.  FCA Developments Relating to Non-Financial Misconduct

As noted in a prior alert here, the FCA has published new rules for how firms should deal with non-financial misconduct (NFM). These rules will come into force from 1 September 2026.

On 12 December 2025, the FCA published further guidance to support those new rules.⁸ This includes changes by the regulator to align the FCA’s rules with employment law obligations. For example, the FCA has included a new illustration in the guidance that an individual can breach the FCA Handbook Code of Conduct even if their hostile and intimidatory communication is intercepted before it reaches the intended subject. It also makes clearer that a manager will not be held responsible if they did not know about NFM by others or did not have authority to stop it.

As the FCA notes in its Policy Statement announcing the new guidance, however, “[e]ach case of NFM is unique, and it is not possible to provide enough examples or case studies to address the wide range of scenarios firms may encounter”.⁹ There is likely still to be some difficulty for firms to apply many of the new rules, and it may be that employees and others will take a different view from the firm. This could of itself lead to whistleblowing reports to the firm or the FCA.

Firms will need to be prepared to respond to whistleblowing complaints in light of the new rules and guidance, particularly noting that there are ambiguities in how to apply certain of the requirements. Clear policies and procedures and training for those who are likely to receive complaints about NFM within firms will help institutions and their staff to effectively navigate these new rules.

4.  “Bounties” for Whistleblowers

The UK government has announced that it is exploring opportunities to reform the UK whistleblowing framework, including through potential financial incentives, as part of its anti-corruption strategy.¹⁰ Following the 2025 Budget, HM Revenue & Customs (HMRC) introduced a “Strengthened Reward Scheme” (Scheme) for individuals who report serious tax avoidance or evasion. Under this Scheme, people who blow the whistle to HMRC about tax avoidance or evasion may be entitled to a reward of between 15% and 30% of the tax collected, if HMRC succeeds at recovering at least £1.5 million in tax. This may increase the number of whistleblowers seeking to make reports.

Whilst there has been talk for some time about other regulators adopting similar schemes, it is only the Competition and Markets Authority that currently has a substantive scheme in operation (there, limited to £250,000 in rewards to the whistleblower).¹¹

This said, the Serious Fraud Office (SFO) has announced that one of its aims in its 2025-26 business plan is to progress whistleblower incentivisation reform,¹² and historically there has been some suggestion that this policy might be extended to other regulators including the FCA. As at the date of writing, however, there appears to be no word on whether the FCA will do so.

This contrasts with the US regime where bounties are available to the US Securities and Exchange Commission (SEC) and Department of Justice (DOJ). Having said this, it has recently been reported that the SEC has denied all 24 whistleblower award claims in the first quarter of fiscal year 2026.¹³ This marks only the second time since 2016 that the SEC’s whistleblower programme did not grant an award in the first quarter of the fiscal year. Total awards were also down in 2025, though this still accounted for almost US$16 million. Large numbers of whistleblower reports are still being made, however, and the DOJ recorded increased numbers of complaints regarding customs and trade fraud (see a recent alert here).

5.  Whistleblowers in the Workplace: An Evolving Legislative Landscape

Section 23 of the Employment Rights Act 2025, which received Royal Assent on 18 December 2025 will amend the current definition of a protected disclosure to expressly include any disclosure that sexual harassment “has occurred, is occurring or is likely to occur”.¹⁴ This amendment, which is expected to come into force on 6 April 2026, will remove any current uncertainty as to whether a disclosure regarding the occurrence of sexual harassment will amount to a protected disclosure, and, in turn, will mean that employees who raise such concerns will be protected from detriment for doing so.

In December 2025, the government issued its policy paper on the UK Anti-Corruption Strategy 2025, which focusses on three “pillars” for tacking corruption.¹⁵ Under its first pillar the government acknowledges that “whistleblowers are one of the most effective assets in identifying wrongdoing” and notes evidence from other countries that the offer of bounties to whistleblowers has resulted in “increased actionable intelligence on corrupt activities and enhancing law enforcement outcomes”. As a result, the government is considering overhauling the current framework for whistleblowing protections in the employment context, which it suggests “may not be operating as effectively as it should be” and assessing the feasibility of introducing financial incentive schemes to those whistleblowers who report economic crimes by 2027.¹⁶

6.  Next Steps for Regulated Financial Services Firms

For FCA-authorised firms, the Handbook is prescriptive in terms of the necessary requirements (see SYSC 18) and firms should familiarise themselves with these rules. This includes, for example, implementing and maintaining appropriate and effective arrangements for reportable concerns (of which there are many specific requirements), giving appropriate training to staff, and for certain entities (principally banks and insurers) appointing a whistleblowing champion. As well as reducing the scope for regulatory intervention, if staff are using the firm’s internal whistleblowing procedures, then it is less likely that firms will be first learning of potential issues from reports made by employees directly to the FCA. To ensure that its internal whistleblowing procedures are effective and in line with legislative developments – and to mitigate against the risk of whistleblower claims being brought in the employment tribunal – firms are advised to review their current whistleblowing processes, policies and procedures, and to provide training to those staff who are likely to receive and/or be required to investigate whistleblowing disclosures.

^{1 https://www.fca.org.uk/data/whistleblowing-qualitative-assessment-survey-2022; https://www.fca.org.uk/data/prescribed-persons-annual-report-2024-25#lf-chapter-id-allegations-in-whistleblowing-reports; https://www.fca.org.uk/firms/whistleblowing#:~:text=We%20always%20aim%20to%20make,the%20FCA's%20searchable%20intelligence%20systems.} 

^{2 Note: one report may contain more than one allegation.}

^{3 3,261 allegations (Q1 – 3, 2025) compared to 3,204 allegations (2024).}

^{4 Albeit that in 2023, there were 206 allegations categorised by the FCA under “treating customers fairly” which, with the introduction of Principle 12 to the FCA’s Principles for Businesses (the “Consumer Duty”), would have been categorised in some other way in the following years and so the data is not entirely uniform.}

^{5 Broadly speaking, this requires firms to “deliver good outcomes for retail customers”.}

^{6 See for example the quarterly reports: https://www.fca.org.uk/data/whistleblowing-quarterly-data-2025-q1}

^{7 Though the data does not always appear consistent; for example, with 250 cases said to have been closed in Q2 2025, but only 249 classified into the categories of how the FCA has closed them.}

^{8 https://www.fca.org.uk/publication/policy/ps25-23.pdf.}

^{9 https://www.fca.org.uk/publication/policy/ps25-23.pdf, para 2.11.}

^{10 https://www.gov.uk/government/publications/uk-anti-corruption-strategy-2025/uk-anti-corruption-strategy-2025-accessible.}

^{11 https://www.gov.uk/government/news/blowing-the-whistle-on-cartels.}

^{12 https://assets.publishing.service.gov.uk/media/67ee4e86199d1cd55b48c6e8/SFO_2025-26__Business_Plan.pdf, page 2.}

^{13 https://whistleblowersblog.org/corporate-whistleblowers/sec-whistleblowers/sec-denies-all-whistleblower-awards-in-first-quarter-of-2026/.}

^{14 https://www.legislation.gov.uk/ukpga/2025/36}

^{15 Pillar 1: combatting corrupt actors and funds in the UK and overseas; Pillar 2: tacking vulnerabilities to corruption in the UK; and Pillar 3: building global resilience to corruption. See paragraph 10: https://www.gov.uk/government/publications/uk-anti-corruption-strategy-2025/uk-anti-corruption-strategy-2025-accessible}

^{16 See Annex C: Summary of Commitments; Commitment 1.1.3 and 1.1.4: https://www.gov.uk/government/publications/uk-anti-corruption-strategy-2025/uk-anti-corruption-strategy-2025-accessible}