SEE ALL TODAY'S STORIES »

Santander fined nearly £33 million for failings in its probate and bereavement processes

20/12/2018 News Team

The Financial Conduct Authority (FCA) has fined Santander £32,817,800 for failing to effectively process the accounts and investments of deceased customers.

The firm did not transfer funds it should have to beneficiaries totalling over £183 million, directly affecting 40,428 customers. 

Santander also failed to disclose information relating to the issues with the probate and bereavement process to the FCA after it became aware of them.

Between 1 January 2013 and 11 July 2016 Santander failed to take reasonable care to organise and control its probate and bereavement process responsibly and effectively, with adequate risk management systems, and by failing to treat its customers and those who represented them on their death fairly.

Santander’s probate and bereavement process contained weaknesses which:

- Reduced its ability to effectively identify the funds it held which formed part of a deceased customer’s estate.

- Resulted in it failing to effectively follow-up on communications with deceased customer representatives.

- Ineffectively monitored open probate and bereavement cases to allow it to determine whether cases had progressed to closure.

In some cases, funds were held for many years contributing to beneficiaries being deprived of the use of them for a considerable amount of time.

In addition, Santander took too long to address the issues within its probate and bereavement process, once it became aware of them, and to commence remediation exercises to transfer funds from affected accounts to beneficiaries.

Mark Steward, executive director of enforcement and market oversight at the FCA, commented: “These failings took too long to be identified and then far too long to be fixed. To the firm’s credit, once these problems were notified to the board and senior management, they were fixed properly and promptly. But recognition of the problem took too long. Firms must be able to identify and respond to problems more quickly especially when they are causing harm to customers.

“The FCA will continue to be on the lookout for firms with poor systems and controls and will take action to deter such failings to ensure customers are properly protected.”

Since 2015, Santander has carried out remediation exercises to transfer funds from affected accounts to beneficiaries, which are almost complete. 

Where appropriate, Santander has paid interest on the funds to beneficiaries to compensate them for the delays as well as compensation for any consequential losses suffered.

As Santander did not contest the FCA’s findings they qualified for a 30 percent discount. Without this Santander’s penalty would have been £46,882,500.

Share with Linkedin Share with Twitter
SEE ALL TODAY'S STORIES »

 RATE THIS ARTICLE
Poor   Average   Good   Excellent