Filed under: climate change Tagged: | banking, banking cock ups, banking ombudsman, banks, business, computer glitch, computer glitches, economy, NatWest, natwest group, RBS, Royal Bank of Scotland, Stephen Hester
Posted on June 26, 2012 by Robert Kyriakides
By foolish speculation with the money of their customers banks have caused many problems for most people in most economies. It seems that the bankers cannot resist a free gamble with other people’s money. Also, whilst insisting and monitoring prudence in their customers who borrow, the banks manage to borrow recklessly, leveraging their deposits into realms of what should be fantasy but is unfortunately reality. As though this damage was not enough we find that banks are not paying sufficient attention to their core business, of getting and looking after the money of the poor mugs who have to use banks. For the past week NatWest, the Royal Bank of Scotland and other banks in that group have managed to mess up what should be a simple business of recording money going in and going out of the accounts of their customers.
Last Tuesday what was described as a computer glitch during a software upgrade, delayed the processing of millions of transactions. That meant for the past week people have been stranded without access to their money abroad, wages have not reached the accounts of staff, businesses do not know who has paid and who has not paid and one poor chap spent the weekend in prison because the bail payment had not been processed by the bank in a way that the authorities could know that the payment had been received.
It is astonishing that the NatWest RBS group did not have a contingency plan or back up to prevent this happening or to mitigate its effect. It is astonishing that the well paid and well-staffed banking ombudsman did not see this coming, and astonishing that at a time when many working days have been lost by bank holidays, jubilee celebrations, and will be lost in London by the forthcoming Olympic Games that this incompetence should be allowed to cause further economic damage.
Of course, the Chief of the RBS NatWest group, the rather bloated Mr Hester, is very sorry. The buck should stop with him, as he “earns” a magnificent salary, but I am sure that the buck will simply carry on being passed from one to another u8ntil we learn, of course, it is all the fault of the customers, who unreasonably expect their transactions to be processed quickly and efficiently.
I am concerned about the “knock on” effect of this latest banking failure. When the dust settles many people and businesses will want to close their RBS NatWest accounts and go elsewhere. Some may believe that there was not a computer failure in truth, thinking that the mess is a conspiracy to prevent a run on the bank. Business confidence, already very low and probably at its lowest level for years, will become non-existent and many may believe that their money is better kept in the mattress or in an old sock in a drawer than in the bank.