Whistleblowers are the single greatest source of information in detecting fraud or other forms of wrongdoing in the workplace. Effectively implemented confidential whistleblowing hotlines can be powerful tools in the fight against fraud.

According to the Association of Certified Fraud Examiners 2018 Report to the Nations, the most common method for detecting fraud or misconduct is via an employer’s staff themselves. Businesses that had whistleblowing lines in place are more likely to detect fraud and other forms of wrongdoing than businesses who do not have hotlines in place.

From an ethical perspective, most businesses hope that their staff will come forward, do the right thing and report fraud and misconduct to their line managers. Unfortunately, there are a number of reasons why this does not always occur.   Employees may not trust their employer’s internal whistleblowing process for fear of reprisal. They may not trust that the process will maintain their confidentiality or that the matter will be taken seriously particularly if they feel that previous fraud offenders have got off lightly.

Whistleblowing hotlines are ineffective if staff don’t trust them. Instilling trust in the whistleblowing process creates a significant challenge for business owners, board members and senior managers. However, there are a number of ways to gain the trust of employees as detailed below:

• Maintain an open line of communication with the whistleblower. Providing whistleblowers with regular updates and appropriate feedback will provide whistleblowers with an understanding of how their disclosure has been handled and dealt with. Expressing appreciation for those who speak up is also important to provide assurances that whistleblowing in the workplace is encouraged.
• Appoint investigation specialists. Selecting independent external investigators can help in eliminating perceived bias and ensure the objective evaluation of whistleblowing concerns.   Specialist investigators who can provide a comprehensive investigation with root-cause analysis will also provide business owners and staff with assurances that the matter will be taken seriously and effective remediation will have taken place.
• Ensure whistleblowers do not face reprisals if a whistleblowing concern raised in good faith. The implementation of a robust whistleblowing policy should include reassurances to staff that they should be able to raise genuine concerns without fear of reprisals, even if they turn out to be mistaken.
• Training. Provide training for staff to ensure that they understand the whistleblowing process and provide assurances that the confidentiality of whistleblowers will be maintained where the law allows. Training should include awareness of potential red flags to help mitigate any key fraud weaknesses or threats to a business.

An effective reporting whistleblowing hotline that is trusted by staff will result in whistleblowers being more likely to come forward to speak up and provide a business with a vital and powerful defence against most forms of wrongdoing.

If you would like information about implementation of an independent external whistleblowing service to provide your organisation with adequate protection against fraud and other forms of wrong doing, please contact our sales team by dialling direct on +44 (0) 1224 625111.