TSB is handing 200,000 customers 'free' compensation payment
TSB is giving 200,000 customers compensation payouts worth nearly £100million. The FCA has fined TSB Bank plc (TSB) £10,910,500 for failing to ensure customers who were in arrears were treated fairly, it has confirmed in an update.
The FCA warned that TSB "didn't have the right systems to ensure fair treatment" for those who needed extra support paying off their mortgage, overdraft, credit card and loan debt. This subsequently left people struggling and facing unaffordable payment arrangements or inappropriate fees.
The fine came after the FCA ordered an independent review into TSB's treatment of customers in July 2020. The FCA found that between June 2014 and March 2020, TSB's poor practices put thousands of these customers on repayment plans they couldn't afford.
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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 spokesman for TSB 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."
TSB would have been fined £15,586,500 but it agreed to resolve these matters so qualified for a 30% discount under the FCA’s processes. The FCA requested that a Skilled Person be appointed to review TSB’s collections and recoveries in July 2020, following concerns raised both during its own supervision work and by TSB itself. This work was carried out between 2020 and 2023.