SEAR proposal puts heat on banks’ treatment of loyal customers

Financial services firms in the United Kingdom were first alerted that their savings customers were potentially being treated unfairly in October 2013. Yet, six years later, the regulator has found it necessary to intervene with a Single Easy Access Rate. What does this long-tolerated behaviour say about firms’ purported focus on customers’ interests? asks Denis O’Connor.

Denis O’Connoris a fellow of both the Institute of Chartered Accountants in England & Wales and the Chartered Institute of Securities and Investment. He was a member of the British Bankers’ Association Money Laundering Committee from 2003-10 and a member of the Joint Money Laundering Steering Group’s board and editorial panel between 2010 and 2016. He has been a frequent speaker at industry conferences on financial crime issues, both in the United Kingdom and abroad.

The Financial Conduct Authority has proposed new rules for the easy-access cash savings market to eliminate longstanding poor outcomes for many of the 40 million customers who hold easy-access savings accounts at banks and building societies. The need for the FCA to make new rules in this area of the market could be deemed to represent a failure of the Senior Managers and Certification Regime. It also throws doubt on banks’ often self-proclaimed customer-focused culture.