The Financial Conduct Authority (FCA) has fined TSB, the British subsidiary of Banco Sabadell, £10.91 million (around €13.04 million) for “unfair” treatment of customers struggling to meet their loans, primarily mortgages. According to the FCA, TSB Bank “failed to ensure that customers in arrears were treated fairly.” “It also lacked the proper controls and systems to ensure good outcomes,” it adds.
The issues occurred between June 2014 and March 2020. TSB’s systems, according to the FCA, led to repayment plans that were not affordable for troubled customers or charged them high fees. TSB was aware of the problems in December 2016 but did not take effective action until 2020 during an independent review that same year.
The bank has paid around £100 million (about €120 million) to compensate the 232,849 affected customers with issues related to their mortgages, loans, or credit cards, among other cases. The fine imposed now by the FCA is 30% lower than the initially proposed amount of £15.59 million (around €18.63 million) because TSB agreed to address the identified issues.
