Four major U.K. banks have been accused of violating a regulator’s competition rules.
The Competition and Markets Authority (CMA) says HSBC, Lloyds, TSB and AIB all breached a 2017 order created in response to competition concerns in the retail banking sector.
The order requires banks to follow strict rules for informing customers about products and services, including accurately displaying interest rates for loans and the right locations for bank branches and ATMs, the CMA said in a Thursday (July 25) news release.
“People deserve banks they can trust to serve them well. Having correct information is essential when making important decisions about our finances,” said CMA Senior Director Dan Turnbull.
“Banks handling our hard-earned money should have adequate processes in place to ensure this happens. It’s disappointing that 7 years on, we have to put in place formal enforcement measures to secure better compliance from a major bank like HSBC which, yet again, is in breach of the rules.”
According to the CMA, HSBC failed to keep updated information about its branches, as 167 closed branches were still listed as open and two open branches were not listed. The banking giant also failed to keep some of its annual rates for business loans and overdrafts accurate and up to date on its website, and told some customers the incorrect maximum amount they would be charged for going into unarranged overdraft.
The CMA had cited HSBC for similar violations in 2022 after finding the bank had failed to provide customers with accurate information about overdraft fees and credit card rates.
A report by the Financial Times included a statement from HSBC UK saying the bank was “sorry for errors on our part which caused these breaches. When we discovered them we reported these to the regulator. We have taken steps to avoid a repeat of these issues in the future.”
As for the other banks, the CMA says TSB failed to disclose the maximum amount customers would be charged for going into unarranged overdrafts.
AIB did not list the correct annual rates for some loans and some overdrafts on its website and through the CMA’s open banking program, while Lloyds failed to provide addresses of 363 ATMs through open banking, the authority said.
“Lloyds, TSB and AIB have confirmed they are making changes to their operations to prevent further breaches — ranging from enhancing their internal procedures, to improving oversight by senior managers, updating internal checklists and retraining staff,” the CMA said.
