BNY Mellon whistleblower awarded record US$50m

A former Bank of New York Mellon trader has been awarded a US$50m in the largest award of its kind made by the US Securities and Exchange Commission. Whilst the UK has not yet gone down the road of rewarding whistleblowers, compliance experts are warning companies not to rule out having a comprehensive whistleblowing programme in place.

“Regardless of the debate around payments to individuals, It has never been more important for firms to ensure they have a comprehensive whistleblowing programme in place,” said managing director, Compliance and Regulatory Consulting at Duff & Phelps, Mark Turner. "Whistleblowers play an important role in exposing poor practice and misconduct in the financial services sector.

“With the right resources, structure, and training, whistleblowing programs can become valuable tools for strengthening a firm’s controls, culture, and reputation."

Whistleblowing has seen a steady increase year-on-year as scandals across different sectors have exposed wrongdoing that people knew about but were unable or unwilling to fix. Turner explained: "In financial services, the potential risks posed by ineffective controls or misaligned incentives are high, and a comprehensive whistleblowing program can be an effective early warning system that allows management to get out in front of these or other problems before they become true crises.

"It remains to be seen whether the UK reconsiders its position on awarding payments to those that risk it all to do the right thing."

In the case of the BNY Mellon trader, the individual alerted authorities to methods used by the bank to overcharge clients on currency trades.

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