TSB fined £11million after failing to treat struggling customers fairly

TSB has paid nearly £100million in compensation to customers who have faced hardships due to the bank's failure to ensure fair treatment.

The financial watchdog has also imposed a £10,910,500 fine for the bank's shortcomings.

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The Financial Conduct Authority (FCA) said that the bank "lacked suitable systems and controls to secure fair outcomes".

Between June 2014 and March 2020, TSB's poor processes put thousands of customers with debts on repayment plans they couldn't afford.

TSB has since paid £99.9million in redress to the 232,849 mortgage, overdraft, credit card and loan customers affected.

The FCA claims staff were possibly encouraged to focus on the number of repayment plans rather than properly assessing each customer's situation.

This risked increased uncertainty and stress, including for vulnerable customers.

It also breached the FCA's rules set out in its Principles for Business, which states "a firm must pay due regard to the interests of its customers and treat them fairly".

An independent review into TSB's treatment of customers who had fallen into debt, ordered by the FCA in July 2020, identified the extent of the failings.

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."

TSB would have been fined £15.6million, but it agreed to resolve the issues identified by the FCA, which meant the fine was cut by 30%.