Customers hit by bank IT failures to get redress

Sarah Davidson

September 4, 2012

The committee today published letters between Treasury Committee chairman Andrew Tyrie MP, RBS and the FSA after recent IT failures affecting RBS, NatWest and Ulster Bank customers.

They include letters from Tyrie to the chief executive of RBS Group, Stephen Hester, and Chairman of the Financial Services Authority Lord Adair Turner.

Treasury Committee chairman Andrew Tyrie MP said: “This episode, and the initial confusion surrounding it, did little for public confidence in our banks.

“Those affected now need clear and straightforward information to enable them to seek redress.”

Tyrie praised Hester for his “swift action” following the bank’s failure saying his decision to take full responsibility was doing “the right thing”.

But he said: “The recent IT failure at RBS Group affected millions of individuals and a wide range of businesses in the UK and Ireland.

“It was not just RBS customers who suffered. The problems, and the confusion they caused, threatened to infect the rest of the banking system. For some, the consequences were very severe.”

Tyrie added that the ability of retail and corporate customers to obtain access to funds and other payment facilities is crucial.

And he added: “The Committee will doubtless want to look closely at RBS’ final report when it is published to ensure that any systemic weaknesses and governance issues are adequately addressed, both by the bank and by the FSA.

“Every bank should be checking its IT systems. We need to have confidence that such a failure cannot happen again.”

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