The Financial Conduct Authority has opened an investigation into the TSB IT meltdown that left nearly 2 million customers locked out of their online accounts earlier this year.
Customers were unable to access TSB’s online services or make payments after the lending giant migrated to a new digital platform in April. Some were also reportedly given access to others customers’ data.
In an appearance before the Treasury Committee, TSB’s CEO Paul Pester had said that the vast majority of customers were still able to use TSB’s services. But in a letter to the Treasury Committee, FCA CEO Andrew Bailey has described the claim as “an optimistic view of services”.
“In conditions of highly volatile service levels, any single number is less meaningful than when a service level ls stable, and in this case risked giving too positive a view,” Bailey wrote. “The numbers are arguable, but in my view greater caution would have made sense.”
TSB had been dependent on the digital platforms of its former owner Lloyds since the two companies split in 2013. Before migrating to its new platform in April, the lender had warned customers that its services would be offline until 6pm on Sunday. But technical issues caused customers to lose access for several days.
Commenting on Bailey’s comments, the chair of the Treasury Committee Nicky Morgan said the regulator “does not make such criticisms lightly”. “I am deeply concerned by TSB’s poor communications about the scale and nature of the problems it has faced; by its response to customer fraud; and by the quality and accuracy of the oral and written evidence provided by Dr Pester to the Committee.”
Pester is due to appear before the committee again later today.