Santander UK has been fined £32.8m by the Financial Conduct Authority (FCA) for failing to properly process the accounts of deceased customers.
Santander did not transfer funds totalling over £183m to beneficiaries when it should have done, affecting a total of 40,428 customers directly.
And, after it became aware of the issues, the bank failed to disclose the problems to the FCA.
Santander said it was “very sorry” for the impact its failings caused.
“We accept the FCA’s findings and have fully cooperated with their investigation,” said Santander UK’s chief executive Nathan Bostock.
“We have now transferred the majority of customer funds and made significant improvements to our whole probate and bereavement process, ensuring we provide both a sensitive and efficient service to our bereaved customer representatives and those who are managing the estates of people who have passed away.”
Mark Steward, executive director of enforcement and market oversight at the FCA said that the failings “took too long to be identified and then far too long to be fixed”.
“To the firm’s credit, once these problems were notified to the board and senior management, they were fixed properly and promptly, but recognition of the problem took too long,” he said.
There were weaknesses in how Santander organised and controlled its probate and bereavement processes, the FCA added.
This meant that the bank:
- failed to follow-up on communications with deceased customer representatives, which increased the likelihood of cases not being closed
- did not effectively identify all the funds it held which formed part of a deceased customer’s estate
- could not determine whether cases had progressed to closure
As a result, despite Santander being informed that a customer had died, funds would not be transferred to those who were entitled to them.
Cary Sumpter, a surveyor from Bexhill-on-Sea, says that Santander is still holding onto money from his late aunt’s estate.
When Mr Sumpter’s aunt died in 2010, his mother and the appointed solicitors spent months telephoning and writing to Santander to release funds from his aunt’s bank accounts.
“There was certainly several hundred pounds in one account, and we thought there were other accounts, but we could never find out,” said Mr Sumpter.
“Santander wouldn’t return calls or emails; they blocked all attempts to find out.”
In the end, the aunt’s estate was settled without the funds held by Santander.
“The solicitors eventually advised us to stop chasing, since it was costing more than the amount was worth,” added Mr Sumpter.
“To this day, that money is still sitting somewhere in the coffers of Santander.
