Bank hit with nearly £60m fine over deposit protection

Business

HSBC has been fined more than £57m for failing to protect consumer deposits.

The fine, totalling £57,417,500, has been levied by the the Bank of England’s Prudential Regulation Authority (PRA) for failing to protect consumer deposits from 2015 to 2022.

It’s the second highest fine ever applied by the regulator, reflecting the seriousness of the breaches, it said.

Under post-financial crash rules, deposits of up to £80,000 are safe in the event of a bank’s collapse under the financial services compensation scheme (FSCS).

But the lender incorrectly marked 99% of eligible deposits as “ineligible” for FSCS protection, the watchdog said.

A fine of £96m was avoided by cooperation throughout the investigation and admitting early that certain rules were breached. Such behaviour cut the fine by 15% while agreement to resolve the issue qualified for a further 30% reduction.

Had such a fine been imposed it would have surpassed the record £87m that Credit Suisse was hit by last summer.

One of the failings stemmed from the absence of a senior manager with responsibility for the processes and information required under depositor protection rules.

HSBC also attracted criticism for failing to be “duly open and cooperative” by not alerting the PRA about problems identified in the incorrect marking of accounts as “eligible” for FSCS protection over a 15-month period.

“This was clearly information which the PRA would expect firms to share fully and in a timely way,” the regulator said.

The bank “fell far short of its obligations in this area, and failed to disclose its failings to us in a timely manner”, said Sam Woods, a Bank of England deputy governor.

The PRA said, however, the breaches weren’t deliberate or reckless.

This breaking news story is being updated and more details will be published shortly.

Please refresh the page for the fullest version.

You can receive Breaking News alerts on a smartphone or tablet via the Sky News App. You can also follow @SkyNews on X or subscribe to our YouTube channel to keep up with the latest news.

Products You May Like

Articles You May Like

Sean ‘Diddy’ Combs allegations are ‘tip of the iceberg’, says lawyer
Shark Gut Design Enables Valve-Free Pipes for Efficient Fluid Flow, New Study Suggests
Trump’s pick to lead NASA made a big bet on crypto while going to space on the side
Jaguar’s controversial $200,000 ultra-luxury EV spotted out in public [Video]
Boeing Starliner Astronauts’ Return Delayed Until March 2025 Following SpaceX Delay

Leave a Reply

Your email address will not be published. Required fields are marked *