Tesco Bank Has Cash Stolen from 20,000 Accounts, Freezes Transactions
Tesco Bank froze online transactions following fraudulent activity that affected thousands of customers and has pledged to refund clients whose money was taken over this past weekend from their accounts.
The CEO of the banking arm of the supermarket chain, Benny Higgins said the decision was taken to stop all online transactions in an attempt to protect its customers.
He added that over 40,000 accounts were affected, of which half had money stolen in what he called “online criminal activity.”
Tesco shares experienced the biggest drop on the FTSE 100 as they fell 3%.
During the weekend, customer reported money had been taken from their accounts with some of them complaining they could not contact the bank via phone. The bank has over 7 million customers.
Higgins said that the bank apologized for the inconvenience and worry that the activity caused and stressed that they currently were taking all the steps necessary to protect the accounts of every customer.
The bank has grown very quickly and is attempting to grab market share from Lloyds, Barclays, RBS and HSBC known as the big four.
During a time when other banks, such as Santander, have lower rates they pay clients, Tesco Bank offers 3% interest on its balances of up to £3,000 and allows customers two accounts.
No details were provided by Higgins, as to why the accounts were compromised.
The bank sent out alerts via texts to its account holders late Saturday when it had detected activity they deemed suspicious on a number of different accounts. Customers had been reporting that up to £600 had been taking from their accounts.
The situation is being monitored by the Financial Conduct Authority in Britain. In addition, the National Crime Agency said that Tesco Bank had notified it and it was coordinating what response it would be disseminating information to law enforcement.
One customer said that he had received two emails and texts to call the bank’s fraud team but was put on hold for more than 45 minutes before being cut off.
Another customer said that in the online help forum at Tesco that he has spoken after being on hold for almost an hour and a half said it would call him back but he had been waiting to be called back as he did not have any sign of where his £2,400 had gone.
The bank has over £8.1 billion equal to $10 billion in deposits.