RBS, and us, the taxpayers, will be having to cough up £2.17 million to pay an FSA fine incurred by Churchill Insurance and Direct Line. Both Churchill Insurance Company Limited and Direct Line are private companies, owned by the Royal Bank of Scotland Group Plc..
It was discovered that both of these companies had altered customer files to remove and downplay complaints against them.
The FSA has pointed out that overall the changes to the customer files have not affected customers, however, the act of removing or editing customer complaints is a serious breach of FSA rules and it has therefore imposed a hefty fine.
In one case a member of staff had also forged the signature of colleagues. It is a requirement that any changes to client data are checked and verified before being updated. These rules usually apply only to general administration, such as the updating of accounts and processing of corporate actions for shareholders. The fact that an individual had been forging signatures is another serious breach and highlights how easily fraud and corruption can take place in the workplace.
The FSA have also pointed out that while the managers were not aware that these alterations had taken place, they had not taken appropriate measures to ensure that staff were aware that such alterations were against company policy and FSA rules. A lack of staff training is something that the FSA takes very seriously. For example, all staff working in investments and dealing with client money must go on money laundering courses every 2 years to ensure that they are kept up to date on rule and regulations.
This news has not affected Royal Bank of Scotland Group plc (Public, LON:RBS) share price, it is currently trading at 24.86p, up 0.04% so far today.