RBS computer glitch costs Ulster Bank £18m

| October 12, 2012 | 0 Comments
RBS computer glitch costs Ulster Bank £18m

An IT failure at parent company RBS was a “major disaster” for Ulster Bank, its chief executive Jim Brown told a committee at the Northern Ireland parliament.

Following a routine software upgrade on 19 June which went wrong, thousands of Ulster Bank customers were unable to access their accounts.

Ulster Bank has paid out £18m to 300,000 customers affected by the technical glitch, Mr Brown said.

This includes customers who received £20 in compensation if they made a transaction at the bank between 19 June and 18 July.

Many customers were still experiencing problems weeks after the error occurred.

Mr Brown told Stormont’s Enterprise Trade and Investment Committee: “It’s true that the incident was a major disaster, there’s no doubt about that from the bank’s perspective.

“It’s also clear that we had issues with regard to the contingency plan relating to our systems operating as they should have.”

The cost of compensation could rise further as the bank is still considering compensation applications.

“We understand the impact of this matter and have been working tirelessly to put things right for customers and to rebuild their confidence and trust,” Mr Brown said.

The systems failure has been resolved and the bank is implementing measures to ensure that a similar situation does not occur in the future.

Meanwhile NatWest, which is also part of the RBS group, has admitted that it recently suspended its Get Cash mobile banking app because of concerns over fraud.

The app generates a security code which allows customers to withdraw cash from ATMs without a debit card.

Problems were revealed by Radio 4′s Money Box programme, with dozens of customers complaining that large sums of money had been stolen by criminals who used the Get Cash system to access their accounts.

According to NatWest, the criminals are stealing details needed to use Get Cash through phishing emails.

Initially the bank said it had suspended the system as part of a planned update, but has now admitted that security concerns are behind the suspension.

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