FSA fines Bank of Scotland £3.5m
Bank of Scotland, which is part of the Lloyds Banking Group, has been fined £3.5 million by the Financial Services Authority (FSA).
The matter arose after the Financial Ombudsman Service received appeals from investors who said their complaints had been rejected wrongly.
As a result, the bank has been ordered to pay customers around £17 million after not efficiently dealing with complaints about investment products.
The bank has apologised and has agreed to review more than 8,000 rejected complaints relating to investment advice given from February 2004 to the end of 2009.
The majority of the complaints arose from elderly customers with little or no understanding about the bank’s investment products including the Bank of Scotland’s Collective Investment Plan, the Personal Investment Plan, the Guaranteed Growth Bond, the ISA Investor and the Guaranteed Investment Plan.
Tracey McDermott, the FSA’s acting director of enforcement and financial crime, said: “This fine reflects the Bank of Scotland’s serious failure to treat vulnerable customers fairly.”