Upheld: poor customer service, failed communication, mismanagement of KYC review process complaint against HSBC UK Bank Plc

Decision detail

Summary

M, a limited company represented by its director Mr H, complained that HSBC provided poor customer service during a mandatory KYC (Know Your Customer) review initiated in early 2025. The review process involved multiple requests for the same form, failed communication attempts, and a critical unrecorded August telephone call that resulted in conflicting understandings about whether M's ownership had changed and whether the review was complete. HSBC claimed Mr H stated ownership had changed (triggering a restart of the review), while Mr H denied this and Companies House records confirmed no change occurred. The ombudsman upheld the complaint, finding HSBC mismanaged the telephone call, but upheld the bank's £150 compensation offer as fair, noting compensation could only be awarded to the company M (not the director) and some costs would have been incurred regardless.

The Ombudsman's reasoning

While some delays were attributable to postal delays and the bank's tight regulatory deadlines, HSBC failed to manage the critical August telephone call adequately. The call was not recorded, leading to fundamentally different understandings between the parties about whether ownership had changed and whether the review was complete. The ombudsman found it highly unlikely Mr H would have claimed ownership changed (given Companies House records and the inconvenience it would cause him), suggesting HSBC misunderstood or misrecorded what was said. However, the ombudsman could only award compensation to the company M, not to Mr H personally, and concluded £150 was fair given some costs would have been incurred regardless and M was not actively trading.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website