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TSB online banking chaos leaves MPs demanding action TSB online banking chaos leaves MPs demanding action
(about 4 hours later)
TSB’s botched IT “upgrade” has snowballed into a full-scale crisis that has left up to 1.9 million customers locked out of their accounts for five days, with MPs demanding action and the bank facing a potential multimillion-pound compensation bill and regulatory fines. TSB’s botched IT “upgrade” has snowballed into a full-scale crisis, with up to 1.9 million customers locked out of their accounts for a fifth day, MPs demanding action and the bank facing a potential multimillion-pound compensation bill and regulatory fines.
All access to the bank’s internet and mobile services remains blocked, while customers calling its phone banking service report waiting times of more than an hour. In one of the worst IT problems to hit Britain’s banking sector in years, TSB took all its internet and mobile services offline for emergency repair work, after a migration to a new platform over the weekend backfired.
In branches, some customers are being told it could be another 48 hours before they can access their accounts properly, while the bank’s website says some issues, such as one-time passwords and Isa transfers, will only be fixed “by the end of April”. TSB’s chief executive, Paul Pester, apologised for the chaos on Tuesday morning, promising that services would resume by the afternoon and that “no one will be left out of pocket as a result of these service issues”.
The TSB chief executive, Paul Pester, apologised for the chaos, but did not give a definite timescale for the reopening of digital services, which were closed at 10.30am on Tuesday. But at the end of the working day, and with TSB branches closed, customers were still unable to access their accounts online. Customers reported waiting for more than an hour to get through to the phone banking service. Owners of small businesses said they were unable to pay salaries or manage transactions, while some account holders found all their direct debits had disappeared.
“Of course, customers can rest assured that no one will be left out of pocket as a result of these service issues,” he added. Lee MacDonald, a former actor who starred as Zammo in Grange Hill, was among the small business owners affected. He said his company, Mentor Lock and Safe Company, in Wallington, south London, had “literally stopped”.
The botched transfer of banking data has plunged the bank into the worst turmoil since it was spun out of Lloyds. About 1.3bn customer records previously managed on IT systems at Lloyds Bank were transferred over the weekend to IT systems provided by TSB’s new owner, Spanish bank Sabadell. In TSB branches, some customers were told it could be another 48 hours before they could access their accounts properly, while the bank’s website said some issues, such as one-time passwords and Isa transfers, would be fixed by the end of April.
While most TSB account holders have been able to continue using their cards to make payments and withdraw cash from ATMs, many say the problems are deeper than TSB is admitting. The crisis began on Friday night, when TSB began a long-planned migration of 1.3bn customer records away from former parent company Lloyds Banking Group’s IT systems, on to a platform created by TSB’s new Spanish owners, Sabadell. The job should have been completed by 6pm on Sunday.
Outside a branch in the City of London, Mac, a retired photographer and TSB customer, said he was “appalled” at the bank’s problems. Pester admitted that, in one glitch, customers were shown entries in other accounts: “402 customers could see some data that we would not normally show them online.”
“All my direct debits have disappeared,” he said. “They were there yesterday, but gone today. And there’s something saying the last payment was in 2099. I’ve also had to change my password to get into the account. While most TSB account holders had been able to continue using their debit cards to make payments and withdraw cash from ATMs, many alleged the problems were deeper than the bank was admitting.
“The thing that most infuriates me is the statements coming out of the bank. They are not being honest. They keep saying it’s ‘intermittent’ when it’s not. At first I tried to phone. I was on the line for an hour but then gave up and came down here. They have told me that it will be sorted out in 48 hours from today, but I don’t know what to believe.” Outside a branch in the City of London, Mac, a retired photographer, said he was appalled by the bank’s problems. “All my direct debits have disappeared,” he said. “They were there yesterday but gone today. And there’s something saying the last payment was in 2099. I’ve also had to change my password to get into the account.
A businessman, Alex, who runs a professional consultancy firm, said outside the branch: “I have salaries to pay today. I’ve had to come down here to arrange for a bulk transfer over to HSBC, and we’ll have to pay the salaries from there. I tried calling their helpline, but after a while the line just goes blank. To be honest, we’ve had grief with them ever since we were moved from Lloyds. They’re not really a business bank.” “The thing that most infuriates me is the statements coming out of the bank. They are not being honest. They keep saying it’s ‘intermittent’ when it’s not. At first I tried to phone. I was on the line for an hour but then gave up and came down here. They have told me it will be sorted out in 48 hours from today, but I don’t know what to believe.”
Customers have flooded Twitter, with some saying they were unable to pay their mortgages or bills, or access cash. Many have called for compensation. Alex, who runs a professional consultancy firm, said outside the branch: “I have salaries to pay today. I’ve had to come down here to arrange for a bulk transfer over to HSBC, and we’ll have to pay the salaries from there.
Pester admitted that 402 TSB customer accounts had been exposed for a period on Sunday night. “Four hundred and two customers could see some data that we would not normally not show them online,” he said. “I tried calling the helpline, but after a while the line just goes blank. We’ve had grief with them ever since we were moved from Lloyds. They’re not really a business bank.”
Samantha, a TSB customer in Doncaster, logged in on Monday only to find the account she was looking at was not her own. She said: “Yesterday morning I could see I had £200 more than what I should have. After logging off and then on again I could see the transactions were completely different to mine. Many have called for compensation similar to the £70m RBS paid out after the previous big IT meltdown in banking in 2012.
“After getting to work and checking the cash machine my account balance was shown at £0 and then 20 minutes later £245 – all these amounts were wrong. By the evening my accounts had vanished and now I am unable to get back in. I tried to call TSB yesterday and got an automated person speaking and then the phone went dead.” Nicky Morgan, the Conservative MP and chair of the Treasury committee, has written to Pester to demand answers; he will also contact the City regulator, the Financial Conduct Authority (FCA).
Nicky Morgan, the chair of the Treasury committee, has written to Pester to demand answers and will also write to the Financial Conduct Authority. “This is yet another addition to the litany of failures of banking IT systems,” Morgan said. “It simply isn’t good enough to expose customers to IT failures, including delays in paying bills and an inability to access their own money.
“This is yet another addition to the litany of failures of banking IT systems,” Morgan said. “It simply isn’t good enough to expose customers to IT failures, including delays in paying bills and an inability to access their own money. Warm words and platitudes will not suffice. TSB customers deserve to know what has happened, when normal services will resume, and how they can expect to be compensated.” “Warm words and platitudes will not suffice. TSB customers deserve to know what has happened, when normal services will resume, and how they can expect to be compensated.”
Following Royal Bank of Scotland’s June 2012 IT meltdown, which left customers locked out for days, RBS paid out £70.3m in compensation. Multimillion-pound bonuses to Pester and 30 other senior TSB staff, which were dependent on the IT migration, are now under threat. The payouts, which include a £1.6m bonus for Pester, were frozen after TSB was forced to delay the move from Lloyds to Sabadell last year. TSB’s remuneration committee has yet to decide whether to pay the bonuses.
Multimillion-pound bonuses to Pester and 30 other senior TSB staff were dependent on the IT migration and are now under threat. The payouts, which include a £1.6m bonus for Pester, were frozen after TSB was forced to delay the move from Lloyds to Sabadell last year. TSB’s remuneration committee has yet to decide whether to pay the bonuses. The FCA and the Information Commissioner’s Office said they were investigating the problems. They have the power to fine TSB for the botched system upgrade and data breaches.
Both the Financial Conduct Authority (FCA) and the Information Commissioner’s Office (ICO) said they were looking into the problems. They have the power to fine TSB for the botched system upgrade and for data breaches.
The FCA said: “We are aware of the issue and liaising with the firm.” The City watchdog can also censure a firm and take action against individuals by fining or banning them from working in the City.
An ICO spokesperson said: “We are aware of a potential data breach in relation to the TSB and are making inquiries.”
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