On 13 April 2023, the PRA imposed a penalty of £116,600 (reduced to £81,620) on Mr Abarca under s66 Financial Services and Markets Act 2000 for failings under Senior Manager Conduct Rule 2. The PRA had already fined TSB £27,000,000 in December 2022 (reduced to £18,900,000 upon settlement) for regulatory failings relating to the incident. Enforcement action: PRA willingness to pursue Senior Managers for outsourcing failings Disruption to customers and consumers was significant and received widespread attention. When the migration took place on 20 – 22 April 2018, TSB encountered serious issues, including failures with online, telephone and mobile banking, branch technology failures and payment transaction issues. Although his responsibility for complying with the PRA's Outsourcing Rules was split with another Senior Manager, he was responsbile for operational relationships with third party IT providers and TSB's outsourcing relationship with SABIS. Mr Abarca was TSB's CIO and SMF18, and accountable for TSB's IT and IT business continuity planning during and in the run up to the incident. The arrangement provided for SABIS to engage external third party service providers to deliver certain systems and services required for the new platform and migration. TSB entered into an outsourcing arrangement wit Sabadell's IT service subsidiaries, SABIS Spain and SABIS UK (together "SABIS"), to design, build and operate the new platform. Migration involved a major IT change programme, largely via a single main migration event, with some functionality transferred through earlier transition events. In 2015 following TSB's takeover by Sabadell, TSB decided to migrate its IT services to a new platform based on Sabadell's IT banking platform, Proteo. The Decision is the first time that the PRA has taken action for a breach of its Senior Manager Conduct rules and sends a clear message of the importance of firms' conducting appropriate diligence and oversight of their third party outsourced IT suppliers, including intragroup IT services. The PRA has used its powers under the Senior Managers and Certification Regime to fine TSB's ex-CIO £81,620 for failures relating to TSB's IT meltdown in 2018 (Decision).
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