Muscat: The Central Bank of Oman (CBO) says it supports the adoption of ‘whistle-blowing’ policies by banks in the Sultanate as part of a wider commitment by financial institutions in combatting financial fraud.
The endorsement came during a forum on Fraud Risk Management hosted by the Association of Certified Fraud Examiners (ACFE) Oman at the College of Banking and Financial Studies (CBFS) last week. CBO Executive President Tahir bin Salim al Amri (pictured), was the chief guest at the event.
“We encourage it, we are already doing it, and it’s something that I personally endorse,” said Al Amri. “Although it is more of a requirement for publicly listed companies from the audit side, we support it,” he added in comments to the Observer.
Whistle-blowing is described as a policy that encourages employees of an organisation – government, public or private – to report suspected misconduct, financial malfeasance or other illegal acts without fear of retribution.
According to V N Sethuraman, an executive in the Banking Development Department at CBO, commercial banks and financial institutions in the Sultanate need to have a whistle-blowing policy in place as part of their overall system and framework for managing fraud-related risks.
Whistle-blowing policies should enshrine responsibility, protection, confidentiality and reward, said Sethuraman in a talk on fraud risk management. Banks should also have in place dedicated email IDs, dedicated phone number, 24×7 access to phone bank officers, and a database of suspected fraudsters – all as part of a comprehensive framework of measures to prevent, detect and resolve incidents of fraud.
Article 7 (ii) of the CBO’s recent ‘master-circular’ on Fraud Risk Management states thus: ‘FLCs (financial and leasing companies) should have a Whistle Blower Policy (WBP), duly approved by the board. Whistle blowing with responsibility, protection, confidentiality and reward should be encouraged at all levels in the organisation, and it should be reckoned as a part of corporate / professional responsibility of all concerned.
“The WBP should facilitate the FLC’s staff and other stakeholders to provide information and report any activity that is considered illegal, unethical or not correct, without fear of adverse consequences. The procedures/various channels available for whistleblowing should be well-publicised. The WBP should be periodically reviewed.”
It is understood that most of the large and well-established banks and financial institutions already have whistle-blowing policies in place, as do many of the large oilfield, energy, industrial, investment and logistics corporations operating in the Sultanate. Questions remain, however, of the degree of legal protection afforded the whistle-blower in these policies.