Connect with us

Hi, what are you looking for?

Business

Former TSB chief information officer fined £81,000 over IT meltdown in 2018

UK regulators have imposed an £81,000 fine on a former TSB information officer over the bank’s IT meltdown in 2018 that left millions of customers locked out of their accounts.

The Prudential Regulation Authority (PRA) said Carlos Abarca, who was TSB’s chief information officer at the time of the meltdown, “failed to take reasonable steps” to ensure that an outsourcing firm owned by TSB’s parent company was ready to carry out the IT migration of customers en masse.

The fine against Abarca comes months after the bank itself was fined £48m in December for “widespread and serious” failings related to the debacle, which arose during its separation from its former parent company, Lloyds Banking Group.

Abarca is the only TSB executive so far to be held personally accountable by regulators for the IT migration failure.

The Bank of England declined to comment when asked whether any investigations into other bosses were taking place. It could leave the door open for further fines against directors and executives who were working at TSB at the time of the meltdown.

Paul Pester was forced to resign as TSB’s chief executive within months of the incident, after intense criticism from regulators and MPs.

The fine for Abarca is one of the few issued under the UK regulatory senior managers’ regime, which aims to hold bosses personally accountable when things go wrong.

Abarca had been responsible for making sure TSB was following the PRA’s outsourcing rules, and had been managing the bank’s relationship with its main third-party supplier for its IT migration programme.

The regulator said Abarca gave assurances to the board, telling them the supplier was ready for the migration in early 2018, but did this before he had received adequate assurances from the supplier itself. It resulted in chaos for millions of customers, who were locked out of their accounts for weeks after the incident began in April 2018, with some still facing issues in December that year.

Abarca left TSB a year later, in December 2019, before joining TSB’s Spanish parent company, Sabadell, as its chief technology officer. He stepped down from Sabadell earlier this year.

“Senior managers have an essential role to play in ensuring that firms manage and supervise outsourcing effectively,” said the PRA’s chief executive, Sam Woods. “In this case, the PRA has fined Abarca because his management of a key outsourcing relationship fell below the standard we expect.”

The PRA reduced Abarca’s fine by 30% after he agreed to settle the matter. The fine would have otherwise been £116,600.

Read more:
Former TSB chief information officer fined £81,000 over IT meltdown in 2018

You May Also Like

Business

The head of the International Monetary Fund has warned of increased risks to the stability of the financial system after weeks of banking sector...

Stocks

After taking a breather in the week before this one, the Indian equity markets resumed their up move. The headline index continued with its...

Investing

It was supposed to be a debacle. As the Second World War drew to a close, the nation’s leading economists feared that, once the...

Business

Small businesses are bringing forward their finance applications in order to beat expected further interest rate rises, according to new research. Four-in-ten (44%) SME...

Dislaimer: peakprofitplace.com, its managers, its employees, and assigns (collectively “The Company”) do not make any guarantee or warranty about what is advertised above. Information provided by this website is for research purposes only and should not be considered as personalized financial advice. The Company is not affiliated with, nor does it receive compensation from, any specific security. The Company is not registered or licensed by any governing body in any jurisdiction to give investing advice or provide investment recommendation. Any investments recommended here should be taken into consideration only after consulting with your investment advisor and after reviewing the prospectus or financial statements of the company.

Copyright © 2023 peakprofitplace.com | All Rights Reserved