The financial watchdog has fined bank TSB almost £11m over its treatment of customers, but the penalty could have been even worse.
TSB Bank will have to pay £10,910,500 after the Financial Conduct Authority (FCA) found it had failed to ensure customers in arrears were treated fairly.
The FCA said it also didn’t have sufficient systems and controls in place to allow for fair outcomes.
The bank has paid £99.9m to redress 232,840 customers affected, for a range of products including mortgages, overdrafts, credit cards and loans, the FCA said.
It said the problem reared its head between June 2014 and March 2020, where “inadequate processes created a real risk that repayment plans were not realistic”.
The FCA said its training also didn’t support staff in helping customers, and some were “potentially encouraged by incentive schemes to prioritise the number of plans made over taking enough time to assess individual customer circumstances.”
Its failings, the FCA said meant it possibly agreed unaffordable payment arrangements in difficulty, with the extent of the issues unveiled by an independent review, ordered by the CMA in July 2020.
TSB was said to have worked closely with the reviewer and FCA, agreeing to a programme costing £105m to resolve the issues.
The bank would have been £15,586,500 but because it agreed to resolve the issues, it qualified for a 30 per cent discount.
Therese Chambers, joint executive director of enforcement and market Oversight, said: “If you get into difficulty, you hope for – and we expect – fair treatment so a stressful situation isn’t made worse.
“TSB’s woeful systems and controls exposed its customers to risk of harm and meant it missed opportunity after opportunity to do the right thing.
“While it did take action, it took us instigating a review before it acted effectively to address all the issues”
A TSB spokesperson said: “These are historic issues, and we have contacted all affected customers to apologise and reimburse them for not providing the level of service we should have.”
We fixed the underlying issues some time ago and have considerably enhanced our support for customers experiencing financial difficulty.”
From City AM by Jack Mendel –> Full article
