My hon. Friend is absolutely right. We need to improve how we deal with whistleblowers and the legislation around them. We must also insist that regulators, which already have access to sanctions, deal with these issues robustly. There is a cultural problem in the FCA in dealing with this. That must be addressed, and it can only be dealt with by the leadership of the FCA.
The most egregious case I have dealt with over two years as co-chair of the all-party parliamentary group on fair business banking is that of Sally Masterton. She was a senior risk manager at Lloyds. In 2013 she wrote a report called “Project Lord Turnbull”, which highlighted the fraud that was concealed at HBOS before the takeover by Lloyds. She identified a billion-pound fraud—these are not small numbers or small issues, which is perhaps why they are swept under the carpet. She was asked to set out her findings. She produced the report and gave it to her superiors. This was happening at the same time as a police inquiry into the low-level fraud that was happening at HBOS. She was then suspended and prevented from working with the police, despite the fact that the police had said in an email that she was vital to the investigation. She was later constructively dismissed.
She was then discredited. Lloyds wrote to the FCA to discredit her, effectively saying, “This person is a rogue employee. They are not a cogent witness.” The FCA accepted that without any investigation. That was in 2013. Five years later, Lloyds apologised to Sally Masterton, saying that she had been disgracefully treated for five years and admitting that it had tried to discredit her all the way through that process—imagine what those five years of her life were like. The FCA told Lloyds to intervene because she felt she had been terribly mistreated. Andrew Bailey himself had met Sally Masterton and determined that she had been disgracefully mistreated. Lloyds apologised to her and came to a financial settlement with her, but the FCA did not sanction anybody in Lloyds for that mistreatment. That is incredible.
All the FCA keeps telling me is that there is another investigation going on—Linda Dobbs’s investigation of Lloyds’s reporting of information before and after the HBOS takeover—but that is unacceptable. The FCA has already established the mistreatment, yet it will not move forward to sanction the people responsible. Under the senior managers regime, these people, including the chief exec, could be sanctioned, fined or banned. That is exactly what should happen.