RBS face giganto fine for IT cock-up

3 November 2014

rbs Remember the RBS IT cock-up a couple of years ago that made things difficult for their customers? Recall the group then admitting that they hadn't invested in their systems in 'decades'?

Well, all that is about to bite them on the behind.

The Financial Conduct Authority (FCA) is going to fine RBS tens of millions of pounds for their failure. For a system-problem, this will be a record fine. The banking group had previously said that they'd put aside £175m to sort this out.

As ever with these fines, if the RBS settle up within 28 of the FCA imposing a fine, they'll get a discount of up to 30%, which seems peculiar, but that's the world of finance for you.

Sources put the scale of the likely fine to be imposed on RBS at "several tens of millions of pounds", which would rank it among the largest ever handed out by the City regulator for offences unrelated to the manipulation of financial markets.

You may remember that RBS had another systems outage on the busiest online shopping day of the year, last December, which meant that customers weren't able to use their cards, cash machines and online banking services. Since then, RBS have vowed to plough over £1bn into their digital capabilities and IT systems.

Clive Adamson, director of supervision at the FCA, said earlier this year: "To access and manage our money we depend on the banks' IT systems being reliable. But IT outages continue, interrupting key banking services. We want to make sure that the banks have resilient IT systems in place that are able to cope with consumer demand, so customers aren’t left financially stranded or disadvantaged."

We can only hope that this fine acts as a kick up the arse to other finance companies.

TOPICS:   Banking   Government   Debt

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