UK: Yorkshire Building Society fined £4.1million over delays
- Credit: PA
A building society has been fined £4.1 million on top of the £8.4 million it is already paying to compensate mortgage customers who were poorly treated when they got into difficulties.
The Financial Conduct Authority (FCA) said delays in determining the most suitable repayment plans resulted in some customers at Yorkshire Building Society (YBS) incurring increased fees and associated interest.
The Bradford-based lender has already started the process of refunding 34,000 customers an average of £247 for mortgage fees and accrued interest charged since 2009.
Announcing the fine of £4.1 million, FCA enforcement director Tracey McDermott said that by allowing cases to drift without agreement customers in vulnerable circumstances risked falling into further financial difficulty.
She added: “Firms must ensure that they are taking into account the particular circumstances affecting customers who find themselves in difficulty.
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“Firms need to be dealing with these customers proactively, without delays, in order to ensure they are not losing out.
The investigation covering October 2011 to July 2012 found that insufficient training and inadequate guidance meant call handlers did not consistently probe customers’ circumstances and identify the cause of their problems.
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These issues were not spotted because weaknesses in checking procedures meant YBS management was deprived of information that may have highlighted poor treatment of customers.
YBS said it has increased staff training and overhauled practices in order to better assess how it can help customers in financial difficulty.
Chief executive Chris Pilling said: “I hope the refunds we have voluntarily given to customers and the changes we have made demonstrate how seriously we have taken this issue and our commitment to put things right.
“We believe the improvements and investment we have made in this part of our business will deliver the level of service our members expect of us and our focus on achieving that is absolute.”
Yorkshire is the UK’s second biggest building society behind Nationwide. Its other brand names are Barnsley Building Society, Chelsea Building Society and Norwich & Peterborough Building Society, as well as Accord Mortgages.