TSB hit with £48m fine over historic IT fiasco
The Financial Conduct Authority (FCA) notes that the fine follows technical failures within TSB’s IT systems which meant that customers were unable to access banking services.
The regulator noted that TSB’s attempts to update its processes and migrate data for corporate and customer services back in April 2018 led to technical failures and significant disruption.
All of the bank’s branches and a “significant proportion” of its 5.2m customers were impacted by the issues, while it took until December of that year for TSB to resolve them satisfactorily.
TSB has paid out £32.7m in redress to customers who were detrimentally affected by the technical problems.
According to the FCA, TSB had failed to organise and control the migration programme adequately, as well as to manage the operational risks that came from its IT outsourcing arrangements with third-party suppliers.
TSB failings were ‘widespread and serious’
It was fined £29.75m by the FCA, with a further £18.9m fine levied by the Prudential Regulation Authority (PRA). This took into account a 30% discount for agreeing to resolve the matter with both regulators, without which it would have been fined a total of £69.5m.
Mark Steward, executive director of enforcement and market oversight at the FCA, said that the failings at TSB were “widespread and serious” and had a “real impact” on customers.
He added: “The firm failed to plan for the IT migration properly, the governance of the project was insufficiently robust and the firm failed to take reasonable care to organise and control its affairs responsibly and effectively, with adequate risk management systems.”