LONDON, Aug. 27 (Xinhua) -- The Royal Bank of Scotland Group (RBS) and its NatWest business were on Wednesday fined 14.5 million pounds (24 million U.S. dollars) by the British financial watchdog for serious failings in their mortgage sales business.
The firms failed to ensure that advice given to customers was suitable, said the Financial Conduct Authority (FCA) in a statement.
The watchdog added two reviews of sales from 2012 found that in over half the cases, the suitability of the advice was not clear from the file or call recording.
Only two of the 164 sales reviewed were considered to meet the standard required overall in a sales process, the FCA said. Some advice was "highly inappropriate and may have resulted in the borrower being sold the wrong type of mortgage for them," it added.
RBS and its NatWest business have agreed to contact about 30,000 consumers who received mortgage advice between June 1, 2011 and March 31, 2013, although there was no evidence that the failings have caused widespread detriment to customers.
The firms settled the FCA fine early and thereby avoided paying an additional 20.7 million pounds.
"Taking out a mortgage is one of the most important financial decisions we can make," said Tracey McDermott, director of enforcement and financial crime at the FCA.
"Poor advice could cost someone their home so it's vital that the advice process is fit for purpose. Both firms failed to ensure that their customers were getting the best advice for them," said McDermott.
On the April 1, 2013, the FCA became responsible for the conduct supervision of all regulated financial firms and the prudential supervision of those not supervised by the Prudential Regulation Authority (PRA).
The RBS group is a large international banking and financial services company based in Britain. (1 pound = 1.66 U.S. dollars)