The City regulator has implemented a fine of £20.7 million for Clydesdale Bank due to ìserious failingsî concerning complaints over Payment Protection Insurance. This is the biggest fine for this type of misbehaviour that the Financial Conduct Authority have issued.
The Financial Conduct Authority also informed the public that up to 93,000 customers may be in line to receive a refund or more compensation.
In response, Clydesdale Bank have issued an apology and stated they have implemented a number of alterations to the way they handle complaints on the issue.
The charge is the result of a policy alteration that occurred in May 2011. Because of this alteration, the employees who handled the PPI complaints at Clydesdale did not take into account all the necessary documentation when making a decision over wrongly sold insurance.
Further to this, the firm was found to have given false information between May 2012 and 2013 to the Financial Ombudsman Service.
Exploring the case in further detail, some employees at the firm were found to have ìaltered certain system print outsî in order to masquerade the fact that they were storing some documents that were relevant to the complaint cases. They also erased data from customer records that pertained to Payment Protection Insurance sales.
The FCA stated that these activities had not been overseen by managers at the bank.
Clydesdale Bank have responded by investigating 180,000 files to see if any customers deserved further compensation. The headquarters of the firm is in Glasgow.
The chief executive for the company, Debbie Crosbie, stated: ìAs soon as this issue was discovered, we took immediate steps to stop it; we made the regulator aware and rapidly introduced strict new monitoring procedures to prevent any recurrence.î
Since January 2011, a massive £18.5 billion has been paid out to customers as a result of the PPI scandal. Along with its sister firm, Yorkshire Bank, Clydesdale have allocated £806 million as a result of the mis-selling of Payment Protection Insurance.
Clydesdale have already been charged £8.9 million in September 2013 due to the fact that they misjudged the cost of mortgage repayments for over 42,000 of their customers.