What is Ulster Bank's policy on compensation?
Published 23/07/2012 | 08:00
My family all bank with Ulster Bank and we have had terrible difficulties getting hold of our own money. My brother has been unable to go on his pre-booked holiday - costing him the price of the flights and hotel and wasting his annual leave. What compensation can we expect from Ulster Bank and what are we entitled to? SB
Large numbers of customers of Royal Bank of Scotland, NatWest and Ulster Bank suffered as a result of the catastrophic failure of the banks' IT systems.
Problems were sorted more quickly at the parent bank's system than at Ulster Bank, for complex technical reasons. By the time Ulster Bank has fully resolved the crisis, some customers will have had difficulty in accessing their accounts for a month - leading to missed mortgage payments and serious problems for account holders in withdrawing their own money.
But it is unclear what compensation will be paid by RBS, NatWest and Ulster Bank. Asked about compensation arrangements, a spokeswoman for Ulster Bank said: "We are reviewing it. We have not announced any details. Anyone who has paid fees or charges (because of the IT crisis) will be refunded."
But the knock-on effects of the crisis go far beyond this, with holidays lost and some customers perhaps resorting to high-cost payday lenders.
Ulster Bank has apparently not yet decided how to address claims for losses and costs such as these.
The Financial Ombudsman Service (FOS) says it is essential that the banks' customers fully itemise all related expenses, keeping receipts.
FOS has had some enquiries from consumers asking for advice, but has not yet received any formal complaints against the banks. Normally the approach adopted by FOS is to put customers back into the position they were in before the loss of service. FOS says that in the past where there have been similar failings - although never on this scale - banks have come up with their own compensation arrangements that have satisfied customers.
But, as a FOS spokeswoman explains: "There are some very complex situations coming out here", in particular with regard to Ulster Bank.
FOS adds that if customers do end up taking their grievances to the ombudsman, it does have the power to require banks to pay for distress and inconvenience, including for consequential loss.
But, it warns, the size of these compensation payments "are generally quite modest". In the past, compensation for distress and inconvenience has usually been less than £300 and is seldom above £1,000.
It also remains clear what will happen where the consequential loss has been borne by someone not an Ulster Bank customer and who does not have a direct legal relationship with the bank.
We suggest that you claim for all direct and indirect costs and argue your case for compensation as strongly as possible.