Bank fined GBP 26.1 million by FCA over poor treatment of customers in arrears

  • 25 January 2021

ORX News story of the month: December 2020

Each month, we share a free operational risk loss event story from ORX News. The story is handpicked by the team as one of the most interesting stories reported by the service in the previous month. This story was published by the service in December 2020.

Bank fined GBP 26.1 million by FCA over poor treatment of customers in arrears

In December 2020, the UK’s Financial Conduct Authority (FCA) fined Barclays Bank £26.1 million ($34.8 million) over its treatment of customers who fell into arrears or experienced financial difficulties between 2014 and 2018.

The FCA found that Barclays had breached the regulator’s Consumer Credit principles by failing to show forbearance and due consideration to business and retail customers when they fell into arrears or suffered financial detriment. Barclays identified at least 1.5 million customers who suffered detriment or were at risk as a result of these failing. Additionally, Barclays knew about many of the shortcomings in its systems and controls as early as 2013, but the failing continued until late 2018.

The FCA said that Barclays had taken significant steps to mitigate the serious structural problems which had led to customers being treated unfairly. Barclays commissioned a consultancy firm to undertake an extensive review of customer files, and dedicated considerable internal resources to addressing the systemic problems. Additionally, Barclays took steps to provide compensation to customers who were affected by the failings by making £273 million in redress payments or balance adjustments to 1.5 million customers.

You can read more on this story here.

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Op risk losses categorised for easy analysis

Every single ORX News story is categorised to help you get the most from the data. The categories include the business line, event type, scenario category. All of this information makes it easier for you to use and analyse the loss events.

Extract of the data for this story from ORX News:

Business line: Retail Banking
Event type: Clients, Products & Business Practices
Loss amount: GBP 26,056,400
Country: United Kingdom
Scenario category: Improper Business Practice

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