FSA has fined Bank of Scotland plc (BoS) £4.2 million for breach of Principle 3 in respect of mortgage records. It found the firm relied on incorrect records for considerable periods of time over a seven-year period. This meant many customers did not receive important information when they should have done. As a consequence of this it did not properly operate a programme it had agreed with FSA to make goodwill payments to customers who had not received clear enough information about changes to the terms and conditions of their mortgages. FSA was particularly concerned the firm identified the errors only after customer complaints. It also noted the large number of customers affected, both because they did not receive important information and because they were not identified as falling within the remedial programme. Although no customer ultimately suffered, FSA considered the mitigating factors were not enough to prevent it imposing a high penalty. (Source: Final Notice – BoS)