RBS fined £14.5m over lousy mortgage advice

27 August 2014

rbs The Royal Bank of Scotland has been fined £14.5m by the Financial Conduct Authority (FCA) after they failed to ensure that they were giving good mortgage advice to customers.

The FCA said: "Two reviews of sales from 2012 found that in over half the cases the suitability of the advice was not clear."

The could've said: 'As if there wasn't enough reasons to loathe them.'

Of course, RBS was quick to apologise, with chief executive Ross McEwan saying that these failures are "unacceptable and should never have happened".

After their investigation, the FCA discovered that RBS and their NatWest buddied had failed to take the full extent of a customer's budget into consideration when they were making a recommendation.

On top of that, the banks didn't give proper debt consolidation advice as well as completely failing to advise customers which mortgage term was best suited for them, according to the watchdog.

"Only two of the 164 sales reviewed were considered to meet the standard required overall in a sales process," the FCA added.

RBS chief executive Ross McEwan said: "Taking out a mortgage is one of the biggest moments in our lives, and our customers have every right to expect the very best service when making this decision. It is clear that in the past the bank just didn't get this right, this was unacceptable and should never have happened."

"When I joined the bank we completely overhauled our processes, and took all our mortgage advisers off the front line for an extensive period of time to get the training required."

Looks like they didn't give the advisers enough training when it comes to treating customers fairly in a financial agreement that could potentially be for life, and indeed, ruin a family financially. Considering that taxpayers own 80% of the bank, thanks to previous bad behaviour from RBS, you'd hope that at some point, they'd try and up their game.

RBS have already mis-sold loads of insurance (to which they've put £3.2bn aside for when that bites them on the arse) and were hit with a £390m fine for their role in the Libor rate fixing affair.

TOPICS:   Banking   Government

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