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How financial institutions can better understand the EU Whistleblower Directive


Do you know who the competent authorities in your jurisdiction who are responsible for whistleblowing are? In case a whistleblowing incident occurs within your financial institution, are you prepared with the right solution? There is lots to consider. Especially if you are based in the EU where the Whistleblower Directive is still being passed into legislation amongst members states.

To make matters even more interesting, there was also the recent National Whistleblower Day held in the U.S. on July 30th. Due to these events we thought we would take a deeper look into how the financial sector was prepared for current and future whistleblowing legislation.

To start, perhaps a small reminder about some of the whistleblowing incidents that may have led to the EU Whistleblower Directive. Of course, this only affects you if you are in the EU or work with financial institutions there. In the UK the Public Interest Disclosure Act protects workers from detrimental treatment from their employer if, in the public interest, they blow the whistle. In Europe they have taken matters further.

Technically speaking, the largest whistleblowing cases to affect financial institutions on the European mainland have been in the cases of Bradley Birkenfeld or Stephanie Gibaud. Both of these whistleblowers had worked for UBS, who everybody knows is headquartered outside of the EU. Bradley was actually a U.S. citizen who just happened to be working in Switzerland. With Stephanie she worked at the Paris offices of UBS.

Whistleblowing, but not just in Switzerland

In 2014 HSBC was also involved in what was called it’s Swiss bank failure. Herve Falciani was the whistleblower in that case. Although the bank did acknowledge its failings eventually, the fact that it seems to happen in Switzerland so often shouldn’t escape you.

CMS experts recently shared how in Switzerland there is no explicit law on whistleblowing. There is also no specific legal protection aimed at preventing discrimination against or the dismissal of whistleblowers under Swiss law. Herve Falciani himself was given a jail sentence of five years in 2015. He was not recognized by the court as a whistleblower even with overwhelming evidence to show this.

Since the Falciani case the Canton of Geneva has adopted a law protecting whistleblowers in the State of Geneva. This is a step in the right direction. However, the Whistleblowing Report 2021 that was undertaken in Switzerland, UK, Germany and France amongst 1,239 companies showed that one in three of the companies surveyed in Switzerland had been affected by whistleblowing in 2020. Only a small amount of them are protected by Swiss law.

But it’s not just the Swiss that one could say have a problem with whistleblowers. Consider the state of implementation of the new EU Whistleblower Directive amongst EU members.

In February the EU Commission decided to refer the Czech Republic, Germany, Estonia, Spain, Italy, Luxembourg, Hungary and Poland to the European Court of Justice for failure to fully transpose the new Directive.  

Since the news about failures in specific countries, the German Whistleblower Protection Act was passed on 12 May this year. We didn’t find any updates relating to the other countries on the list.

What about the U.S. and Whistleblowing?

In the U.S. there has been a lot of whistleblowing cases too. #DisruptionBanking reported about the dismissal of Desiree Fixler from Deutsche Bank in 2021.  Earlier ProPublica highlighted an important story about whistleblowers who sounded the alarm on banks’ mortgage operations in the U.S. Not to mention the huge Wells Fargo cross-selling scandal which whistleblower Jessie Guitron raised.

However, differently to the rest of the world, in the U.S. whistleblowers have been known to receive large payouts. And whilst Sherron Watkins, who was the Enron whistleblower, might be the whistleblower that people remember. It isn’t Sherron who received the largest payout. That payout was to a whistleblower who recently reported Ericsson to the SEC. The whistleblower received $279 million from the SEC. Their anonymity has also been preserved.

This is all part of the SEC Whistleblower Program where whistleblowers can receive between 10 and 30 percent of any SEC recovery.

There has been more substantial support for whistleblowers in the U.S. since the Sarbanes-Oxley Act 2002. More recently the Dodd-Frank Act 2010 added further protections. In fact the SEC Whistleblower Program was created through the Dodd-Frank Act. It led to the U.S. government, In 2022 alone, paying out over $488 million to individuals who exposed fraud and false claims. It recovered much more.

Importantly, one of the first and one of the largest payouts was to Bradley Birkenfeld mentioned earlier in this story. But the payout was made from the IRS and not the SEC. The amount was $104 million. It was such a significant case that it probably instigated FATCA and a whole host of new policies by the U.S. government.

Whistleblower Day in the U.S.

As mentioned in the lead to this story, there was a recent Whistleblower Day that took place in Washington DC. This is where the National Whistleblower Center is located. And this is where the event took place.

Senator Chuck Grassley, co-founder and co-chair of the Senate Whistleblower Protection Caucus, spoke in support of designating July 30th as ‘National Whistleblower Appreciation Day’. Grassley emphasized how this move honors the United States’ first whistleblower law, adopted unanimously by the Continental Congress in 1778.

“Whistleblowers are critical to good government, or just what government is supposed to be doing,” Grassley said. “That’s enforcing the laws, or as the president takes the oath to faithfully execute the laws.

“Whistleblowers risk their jobs, their livelihoods and reputations when they blow the whistle on government waste, fraud and abuse.”

On July 25, U.S. senators went further by proposing the False Claims Amendments Act of 2023.

Transparency International and it’s Advocacy and Legal Advice Centres

In other news there was a World Whistleblowers Day on the 23rd of June. This type of initiative is essential outside of the U.S. Consider Transparency International’s Global Corruption Barometer – European Union where the organization showed how 45% of whistleblowers fear reprisals. And how women are less likely than men to believe they can safely report corruption.

Advocacy and Legal Advice Centres (ALACs) exist in more than 60 countries today. The centres help by empowering people to safely report corruption. These centres have received reports from more than 320,000 people so far. Including whistleblowers. They form part of Transparency International’s commitment to the market.

Find your local ALAC by following this link.

The matter of whistleblowing has been with us for centuries. It will continue to be part of the business landscape in the future too. Financial institutions, just like any other business, will need to increase the support given to whistleblowers. Hopefully leading to a more transparent society.  

If you work for a financial institution and want to discuss whistleblower legislation, or if you are considering becoming a whistleblower, feel free to reach out to our editorial team at

See Also:

Banking whistleblower Bradley Birkenfeld’s next move – YouTube

Why is Deutsche Bank focusing on ESG? | Disruption Banking

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