The number of whistleblower reports relating to consumer detriment increased last year, and is likely to jump further in 2021 following the launch of a new campaign by the City regulator.
In 2020, the number of reports rose from 15 per cent, from 161 in 2019 to 185 in 2020, according to law firm RPC.
Consumer detriment can include a customer being treated unfairly by a provider or being wrongfully recommended or mis-sold a product at an unfair price by a regulated adviser.
Consumer detriment has become an area of increasing focus for the Financial Conduct Authority (FCA), particularly among more vulnerable consumers during the Covid-19 crisis.
Last month the FCA launched a campaign to get people working in financial services to get in touch about potential wrongdoing they see in their day-to-day lives.
Whistleblowers will now receive optional updates on the FCA’s investigations into the problems identified by the whistleblowers.
Jonathan Cary, partner at RPC, said: “As part of the FCA’s response to criticism that it has been too slow to act against scandals like mini-bonds it is going to take whistleblowing reports far more seriously and we expect to see more FCA investigations arising from whistleblower reports and an uptick in consumer redress schemes as a result.”
The FCA estimates there are now 28 million vulnerable consumers in the UK, a sharp rise from the 24 million vulnerable consumers before Covid-19.
Cary continued: “Covid has caused the FCA to focus further on the risks to vulnerable consumers. The regulator will be looking even more closely to see what actions firms are taking to ensure customers are treated fairly.”
The FCA has been contacted for comment.