In order to encourage the public to report illegal financial activities, and increase incentives to whistle blow, the Financial Supervisory Commission (hereafter FSC) has proposed to amend the " Directions for Encouraging the Public to Report Illegal Financial Activities by the Financial Supervisory Commission". The major changes introduced are summarized below:
I.Amendments to the Reward Distribution Standards         (Amendment to Article 5)
(I)The reward for reporting serious illegal financial activities will be raised in order to encourage the public to more actively report serious illegal financial activities. The existing reward of NT$4 and NT$2 million will be raised to NT$5 million and NT$2.5 million.
(II)In order to increase incentives for whistleblowers and to maintain consistency with the actual types of penalties imposed by the FSC, whistleblowers will now be rewarded if their report results in the following types of administrative penalties being imposed: "the entity is ordered to reduce the salary or remuneration paid to its mandated personnel or employee", "revoking or terminating business permits", "restricting investments", or "restricting the scope of fund utilization". The provisions related to some of these administrative penalties will also be amended.
(III)In order to reasonably allocate resources for whistleblower rewards, the FSC has referenced the methods adopted by other Taiwanese administrative agencies, and imposed a NT$2 million limit on the total rewards distributed for each whistleblower’s report of minor illegal financial activities in a single year, at the same time that it has increased the maximum whistleblower reward for reporting serious illegal financial activities.
II.In consideration of the fact that if the whistleblower is able to provide information sufficient to identify the reported person, as well as evidence and information sufficient to prove that the reported person has engaged in illegal financial activity, the FSC is then able to more quickly uncover illegal financial activities. In order to increase the public willingness to report cases of illegal financial activity, the FSC has referred to other administrative agencies’ whistleblower rewards regulations and amended provisions on requirements for whistleblowers to provide information on the reported person (Amendment to Article 9)
The FSC states that these amendments will help to improve incentives for whistleblowers to report illegal activity, increase the willingness of the public to report cases of illegal activity, and effectively maintain order in the financial market. These amendments are announced today. A summary of these amendments and a before and after comparison table detailing the amendments made are published on the FSC website.