Santander UK has been fined £12.4 million because of its widespread failings in its investment advice.
The Financial Conduct Authority initially levied a fine of £17.7 million but the bank got a 30% reduction for agreeing to pay up early.
The failings were uncovered during a “mystery shopping” exercise involving more than 230 visits to the six main high street banks and building societies.
The FCA said Santander UK had failed to give accurate information about its products and services and it said it had found serious shortcomings in the Spanish-owned bank’s advice on Isas, pensions and investment plans.
Some customers were erroneously put into high investment schemes, some were told their money would probably double while others heard that their investment returns were guaranteed.
Overall it found 22% of advisers provided misleading product information, while 28% gave misleading answers on costs.
Also unearthed were shortcomings in the bank's training and monitoring of its advisers.
The decision comes after the City watchdog spent a year investigating Santander UK, the fifth largest retail bank in the UK. It said the bank had “let its customers down badly”.
Santander UK has agreed to contact affected customers and offer redress where appropriate.
