Here's a question for you: What do Equitable Life, Key Data, Shepherds and Arch Cru have in common?

Apart from the fact that they all met a sticky end, in all these cases I can attest that the regulator was informed of the dangers to clients from these firms months, if not years, before they all went horribly wrong.

WealthTek is the latest name to add to this long list, with around £40m of client losses.

In short, many consumers who lost money may not have been out of pocket had regulatory action taken place sooner.

I was reminded of all this with Financial Planning Today's recent story about whistleblowing reports and other similar stories.

It seems to me that there are three strands here.

The first is that ‘whistleblowing’ refers to employees of a firm reporting misdeeds within the firm to some regulatory authority. The ‘Public Interest Disclosure Act 1998’ is focussed on that scenario.

The law assumes that employees of rogue firms should ‘blow the whistle’ on their employer and should be protected for doing so.

The word ‘should’ is doing a lot of heavy lifting here. Many employees are either complicit, or too afraid to blow the whistle, and some employers have a track record of attempting to intimidate or punish whistleblowers.

So it's all very challenging. And that’s without thinking about how all this could work in very small firms. If you are in a one-man band could you blow the whistle on yourself?

The second strand is what about non-employees? They may suspect wrongdoing, but are rarely in a position to prove anything, and have few – if any – legal protections.

If you look at 2022, the FCA had assessed fewer than 25% of the notifications it received. Does that encourage further notifications?

My third strand is that IFAs and Planners are in a unique position. Our skills, experience and duty of care to our clients forces us to carry out due diligence, and to suspect all ‘odd’ offerings. At least, it should.

Most of us understand that one way we add value is in the process of rejection of the latest clever, but intrinsically bad, new idea. Who remembers ‘It’s the fish John West reject, that makes John West the best’?

And to return to the list at the start of this column, that is what happened. But there is a huge question mark over how the regulator treats these bits of market intelligence.

The late Alan Steel exposed Equitable Life as a sham. But instead of investigating the icon that was Equitable Life, the regulator chose to investigate Alan, and others who advised Equitable Life clients that not all in the garden was rosy….

That’s not rumour. I know a few of the firms involved. It’s what happened.

I had my own experience with Key Data, where our due diligence exposed a massive hole, and we notified the then regulator. Nothing was done, the rest is history.

So how can we improve things?

It will not shock you to see me add my voice to the many who have called on the regulator to treat our reports more seriously and with more urgency.

We need to take responsibility as well. Is there a role to channel these through professional bodies, to act as a deterrence for possible, ill-thought out or ill conceived allegations?

They say a stitch in time saves nine and prevention is definitely better than cure. It must be better for everyone to work a bit harder on prevention, rather than shouldering ever increasing FSCS levies.

Phil Billingham FPFS CFP Chartered Financial Planner, Chartered Fellow (Financial Planning) is a Financial Planner and a director of Perceptive Planning, a Chartered Financial Planning firm based in London and Essex. https://www.perceptiveplanning.co.uk/

Biography: Phil joined the profession in 1982 and is a past director of the Institute of Financial Planning (IFP) which merged with the CISI in 2015. He is a past member of the Financial Planning Standards Board (FPSB) Regulatory Advisory Panel. He is a specialist in helping advisers cope with regulatory change and has worked with advisers, planners and regulators in the UK, Europe, USA, Canada, South Africa and Australia. He writes this column most months for Financial Planning Today.