Money goes ‘missing’ from Natwest accounts

The logo of a NatWest bank is seen in London

The crash comes after an IT disaster in 2012 that cost Natwest owner RBS a £56 million fine Toby Melville/Reuters

Thousands of customers of Royal Bank of Scotland have reported their money “missing” this morning, in the latest IT glitch for the bank.

Some 600,000 transactions by customers across the bank – including RBS, NatWest, Ulster Bank and Coutts – have failed after an overnight IT problem, leaving customers unable to access credit or to process direct debits.

NatWest confirmed it knew about the problem via Twitter this morning.

“Some customer payments are missing this morning – we are investigating this issue as a matter of urgency. We are looking into fixing this ASAP and funds will show as normal once the system is back to normal,” the bank said.

A spokesman said: “We are aware of an issue with our overnight process which has resulted in some of our customers not having credits or direct debits being applied to their accounts. We are working to get this resolved as quickly as possible.”

The bank added that it would compensate customers who are “left out of pocket”.

RBS’s IT problem follows difficluties faced by Nationwide building society on Monday, when customers were also unable to access mobile and online banking for two hours early in the day.

RBS has a history of IT failures. The bank left 6.5 million customers shut out of their accounts online, unable to make mortgage payments or to access cash abroad, in June 2012. That disaster cost the bank a £56 million fine from regulators for failing to “put in place adequate systems and controls to identify and manage their exposure to IT risks”.

RBS received 69,500 customer complaints in the days that followed and paid out £70.3 million in compensation to those financially disadvantaged.

Customers affected today have been told to visit a branch if they need cash urgently or to call 03457 888444.

In 2012, the Financial Conduct Authority found that the IT problem had been triggered when an overnight software upgrade failed and the tech workers responded by uninstalling the software “without first testing the consequences of that action”.

“Technology Services did not realise that the upgraded software was not compatible with the previous version,” the FCA said.

The problem also meant that RBS applied incorrect credit and debit interest to customers’ accounts, produced inaccurate bank statements and some organisations were unable to meet their payroll commitments or finalise their audited accounts.

The latest debacle is an embarrassment for RBS as it gears up for the reprivatisation of the government’s 79 per cent stake. The first tranche is expected to be sold in September or October.

RBS is reshaping its business to focus on core retail and business banking, as it sheds almost all of its investment bank.

News of another IT problem will also be a blow to the work it is doing to spin out a new challenger bank under the Williams & Glyn name, as was required by the European Union in return for its state aid. W&G is being given the same IT system as RBS.

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