Saudi Arabia: Financial Rewards and Confidentiality for Anti-Corruption whistleblowers

Whistleblowers reporting cases of corruption in Saudi Arabia will be able to benefit from financial and in-kind rewards.

In a historic move, Saudi Arabia’s anti-graft watchdog has announced it was extending financial rewards and added confidentiality protections to would-be whistleblowers.

The Authority grants financial and moral rewards to those whose reports lead to unmasking corruption instances or saving money for the public treasury based on rules about incentive rewards to those who report on corruption cases,” the Oversight and Anti-Corruption Authority (Nazaha) reportedly said this week.

Nazaha also noted that whistleblowers’ information is treated confidentially in the interest of protecting them from retaliation. “Nazaha protects everyone offering the information, provided they observe secrecy of their reports,” it said. 

Protection of Whistleblowers in Saudi Arabia

A number of royal decrees and laws exist to ensure the consistency, continuity and precision of combatting and preventing corruption in the kingdom. The most recent being Royal Decree dated 05/05/2018 which aims to put the utmost importance to the protection of whistleblowers in corruption and money laundering cases. It ensures the protection of individuals who reported on financial or administrative corruption from mistreatment, retaliation, or violations to their rights or privileges. ​

It will be interesting to follow whether a royal decree or new law is implemented with regards to financial or in-kind rewards to whistleblowers in the near future. Not only does this dissuade potential investors investing in a country, but it also undermines the rule of law and weakens trust in public and private institutions.

The Nazaha web portal currently offers an e-service which enables whistleblowers to report any administrative or financial corruption with the option of keeping personal information confidential.

Enforcement

The commission has recently initiated handling dozens of suspected corruption cases and illegal transactions in different fields. In a report posted on its website, Nazaha said that cases are related to fraud; bribery, and financial corruption and involve high profile officials.

In recent years, Saudi Arabia has stepped up a clampdown on white-collar corruption, nabbing dozens of state employees and entrepreneurs.

Saudi Arabia made headlines in 2017 with its “Ritz Carlton” anti-corruption crackdown that saw senior princes, ministers and prominent businessmen rounded up. The Royal Court announced that it had recovered $107bn (£81bn) in settlements from the crackdown including property, companies and cash. A total of 381 individuals were summoned by the commission.

The crackdown on the kingdom’s elite sent negative shockwaves, and unsettled some foreign investors. Observers were concerned the anti-corruption campaign was a “power grab” by Crown Prince Mohamed Bin Salman, which did not afford due process nor legal representation to the accused.

The importance of rewards

Financial rewards for whistleblowers are increasingly being adopted around the world. The main obstacle preventing whistleblowers to come forward is the fear of retaliation. For company insiders, the fear of losing their livelihood as a result of their disclosure is a main deterrent. Encouraging whistleblowers to come forward requires a financial safety net.

It remains to be seen what this new scope of financial rewards entails, but the presence of reward & protection laws in Saudi Arabia would certainly send a message to potential whistleblowers that their information is valued and can mitigate the risks of retaliation.

For companies operating in Saudi Arabia, this is yet another reminder to put in place internal whistleblowing channels and encourage a speak-up culture.

Disclaimer: The views expressed on this page are personal. The information provided here does not, and is not intended to, constitute legal advice; instead, all examples, media, content, and materials available on this page are for general informational and compliance guidance illustrative purposes only. Readers are advised to contact an attorney in the relevant jurisdiction to obtain advice concerning any particular legal matter or legal development shared here.

Leave a Reply