NatWest 'glitch' leaves victims without pay

Bank says it does not know when systems will be running normally again after IT meltdown

guardian.co.uk, Hilary Osborne and Lisa Bachelor, Friday 22 June 2012

NatWest’s IT meltdown is also having a serious impact on those who do
not bank with it. Photograph: Chris Ratcliffe/Rex Features

Millions of NatWest bank customers have been hit by one of the industry's worst ever computer breakdowns, leaving at least one family forced out of their home and employers unable to make monthly salary payments.

As the crisis moved into its fourth day, the bank, which is owned by the taxpayer-backed Royal Bank of Scotland group, said it did not know when systems would be running normally again, but was confident it had identified the source of the problem, a "technical glitch".

Irate customers told the Guardian they were unable to see how much money was in their accounts and whether bills had been paid. The bank's IT meltdown is also having a serious impact on those who do not bank with it. First-time buyers Mike Johnson and his wife, Laura, were thrown out of the house they thought they had bought on Thursday evening because the mortgage payment did not go through from their solicitor's NatWest account as expected.

"The sales rep turned up that evening and asked us to leave until she could be sure the money was coming. Laura is 20 weeks pregnant and we had to pack our bags then and there, and we are now living with our sister-in-law until this is sorted out," Johnson said.

"NatWest say they are going to compensate people but how are people like us, who do not even bank with them, going to be compensated?"

Another Guardian reader caught up in the chaos said his bank balance was only showing purchases made two days ago and he had no idea what had gone in and out of his account since.

"How can I spend money for food if I have no idea how much money I have left in my account? I have some direct debits due – have they been deducted? Most importantly, have I been paid? When will I know?"

NatWest said the problem emerged as it tried to run payments on Tuesday night. By Friday afternoon it had located the source of the problem, but was still attempting to fix it. A spokesman said: "The problem is one of a technical nature within the bank, not a result of an attack.

"We definitely know what the original problem was and it is being fixed." He could not say when systems would start running normally.

The bank, which has 7.5 million UK personal banking customers and almost 1 million business customers, kept 1,000 branches open until 7pm for a second day running on Friday, and will extend opening hours over the weekend to deal with inquiries. Some branches will stay open longer on Saturday and open on Sunday between 9am and midday. It said customers may be able to withdraw money at branches even if payments into accounts were not showing, but this was being arranged on an individual basis.

However, some have criticised the way that the bank has dealt with the problem.

On the Guardian website one customer wrote: "When I checked with NatWest they said they can't guarantee that even with a high balance that our direct debits will definitely get paid out and it would be up to us to have to claim back any bank charges incurred by direct debits being re-presented. Seems shambolic."

Another said: "It's disgraceful and not the first time for NatWest … feel for the people whose wages not arrived – we can help ours but others not so fortunate. Think we will be looking to move banks!"

Jonathan Hemus, director of Insignia, a specialist in reputation management and crisis communications, said the company should have been prepared to cope with a major IT outage. "NatWest now needs to show that it cares about what happened. While banks can't always be 100% sure about what's going on, they need to demonstrate they're on top of things and acting in an organised way," he said.

"If they don't people can lose confidence in them. It's clearly not helpful that NatWest has taken so long to sort out the problem. The more you can do and the quicker you can do it, the less long-term harm to your reputation."

The bank said it would "ensure no customers will be permanently out of pocket" as a result of missed payments, but it was still not clear what would happen to customers of other banks caught up in the crisis. Some employees expecting their pay day reported being down to their last few pence and said they did not know how they would cope over the weekend if the payments did not go through.

One said: "My employer banks with NatWest. Salaries should have been paid yesterday – still no sign. About a third of my salary due to go out in direct debits in the next few days."

Under Financial Services Association rules NatWest is responsible for any charges customers incur, or interest they need to pay as a result of the bank's error, but there is no liability for consequential losses and consumers who do not bank with NatWest may have trouble gaining compensation.

Lord Oakeshott, the former Liberal Treasury spokesman, said the bank should compensate all customers affected by the problems. "Millions of hard pressed NatWest customers face a bleak weekend without their pay or benefits cheque – with times so hard they have no cushion," he said. "The bank stings them for £30 the moment they go a penny over the line, now it's payback time and they must pay £30 compensation to anyone who's had to wait two days for their cash. When you're really hard up blocked money pipes are as bad as blocked water pipes."

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Blackberry services down in Europe, Middle East and Africa

BBC News, 10 October 2011 

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The crash is a blow to Blackberry which
 is struggling to convince people to pick
its handsets

Millions of Blackberry owners across Europe, the Middle East and Africa have been left without services following a server crash.

Owners of the smartphones were unable to browse the web, send email or instant messages.

The problem appears to have originated in a data centre in Slough which handles Blackberry services for the affected regions.

Blackberry UK said it knew about the problem and was "investigating".

In a tweet sent around 14:42 BST, the company said: "Some users in EMEA are experiencing issues."

A subsequent statement said Blackberry was: "working to resolve an issue currently impacting some Blackberry subscribers in Europe Middle East and Africa."

It apologised for the inconvenience that the ongoing problem was causing its customers.

Earlier on 10 October mobile operators in the UK, Egypt, Kuwait, Qatar and other nations pointed the finger at Blackberry owner RIM when replying to tweets from customers complaining about the problems.

Business and consumer

Many corporate customers said they had not lost service, suggesting that the problem was with Blackberry's BIS consumer systems, rather than its BES enterprise systems.

"Blackberry runs two infrastructures," explained Simon Butler, a Microsoft Exchange consultant at Sembee.

"The understanding I have is that the BIS service has crashed.

"The business side runs on a different set of servers, although enterprise Blackberrys can still use messenger and the consumer services, so they are also affected," said Mr Butler.

Such a major outage will still come as unwelcome news to Blackberry's owner RIM, which has been losing market share to smartphone rivals - in particular Apple's iPhone.

Many corporate clients have switched to the device after Apple made a concerted effort to improve its support for secure business email systems.

"If you have got companies that are shifting their allegiance to other players in the market and you stop being able to provide them that concrete, reliable service, then that's going to have a detrimental effect," said Stuart Miles of Pocket-Lint.com.

Online complaints

The first signs of trouble emerged about 11:00 BST but seemed to have escalated with tags about Blackberry and its BBM service trending on Twitter.

The only functioning service on Blackberry seemed to be text messaging, prompting many users to voice their frustration online.

In an early report, The Daily Telegraph quoted one Twitter user as suffering "serious Blackberry outrage".

Others lamented the loss of the free BBM network saying they did not know what to do without it.

Related Articles:

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Computer glitch hits CBA customers as police give 'free money' warning

News.com.au, By Matthew Schulz, Herald Sun March 01, 2011

Police said up to 40 ATMs had been hit by the glitch. Picture: Alan Pryke

• ATM under guard after spitting out free money
• Up to 40 ATMs said to be affected by glitch
• Police warn taking money is committing fraud

A GLITCH bugging Commonwealth Bank has caused ATMs to spill out "thousands" with police forced to guard some machines.

The malfunction is understood to have affected dozens of ATMs in Melbourne, Sydney and Brisbane.

However, CBA has warned that those customers who took advantage of the glitch, which they insist has now been rectified, are unlikely to get away with it.

Commonwealth spokesman Bryan Fitzgerald told 3AW radio this evening that the glitch was caused after an error in system maintenance last night, and confirmed the problem had affected ATMs in Melbourne.

With ATM networks functioning in offline mode, customers were able to overdraw their accounts - withdrawing more money than was actually available to them.

"We will be following up on those customers to get our money back," Mr Fitzgerald said.

He said customers had an obligation to repay any funds withdrawn that is not theirs and reassured all other customers that their money was safe.

Another Commonwealth Bank spokesman told news.com.au that customers would not be charged overdrawn fees but reiterated those customers would have to pay any overdrawn money back.

"The vast majority of customers had normal transactions," he said.

"However a small majority of customers had overdrawn their accounts and we will be contacting them."

The spokesman added that the problem had been rectified by 5pm and that customers weren't able to withdraw thousands at a time and ATMs were not simply spitting out cash.

Police had received numerous reports of cash being dispensed in large amounts.

NSW Detective Superintendent Col Dyson warned it was a criminal offence to keep excess money dispensed from an ATM, and that they must return it to the bank.

"They should also realise that ATM locations are covered extensively by surveillance," he said.

In Sydney, police were called to guard affected machines, including one at a suburban shopping centre which was "very busy" until the problem was noticed.

Late this afternoon, NSW police reported about 40 ATMs operated by a "major bank" were dispensing large amounts of excess cash.

"There were two or three policeman guarding the ATM," Plumpton Fast Photo retail assistant Jancy told the Daily Telegraph.

"We didn't really know what was going on but there were people crowded around the machine.

"Then the coppers came and stood around while the [service] guy fixed it.

Wizzers Hair Design manager Keven said: "A lot of people came to the ATM and it was very busy between 10.30am until just now.

"We saw about two or three police but they couldn't stop the people, they couldn't say 'No don't do that' because who knows what they were getting?," Keven said.

Earlier, the Commonwealth Bank said “routine maintenance” triggered a major glitch still affecting online, electronic and phone banking.

The computer malfunction has prevented online money transfers and BPAY, and is also affecting EFTPOS, ATM and phone banking.

While the problem was first reported this morning, the issue continued to frustrate customers as the day neared close of business.

Banking customers today were unable to transfer money from their accounts or pay bills as the bank suggested people with urgent transactions should visit a local bank branch.

CBA spokesman Steve Batten said it was investigating the problem which had occurred last night during “routine database maintenance”.

Mr Batten said full banking services were expected to resume this afternoon.

In the meantime, affected services included funds transfer through NetBank, CommSee Bpay and phone banking channels.

Some EFTPOS and ATMs were also affected, he said.

“The CBA understands the potential impact these matters can have on our customers and apologises for the inconvenience,” Mr Batten said.

The bank said its NetBank system was still online, but also reported that scheduled payments due today would be delayed until “later today”.

In a statement, the bank urged customers to “bear with us while we investigate and resolve this issue”.

Read more about the Commonwealth bank ATM glitch the Herald Sun.

Related Article:

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After decade of silence, Y2K alarmist speaks out

NRC International, 30 December 2009 13:02 ,By Freek Staps in New York

A Korean shop holder selling Y2K preparedness packages at the end of the last century. Photo: Reuters

Before the turn of the century, Edward Yardeni spent years raising worldwide awareness of the Y2K-problem. When his predicted pandemonium failed to materialise, Yardeni dropped off the radar for almost a decade. Now, he is ready to speak out again.

Everything digital would collapse, causing death and destruction worldwide - or so those who feared the millenium bug predicted. The reasoning behind this, almost ten years ago, was internal clocks of the world’s computers were not built to understand the year 2000 (or Y2K) and would all jump from 1999 to 1900 at midnight, wreaking all sorts of havoc in their wake.

Nuclear missiles would launch automatically. There would be massive blackouts. The world financial system could shut down. Emergency services would fail en masse and air traffic controllers would be left helpless as planes fell from the skies.

In retrospect these predictions seems a bit far fetched. But the above list was actually summed up at hearing held by the American congress. The speaker: Edward Yardeni, then chief economist of Deutsche Bank Securities and the most famous Y2K alarmist in the world.

Yardeni’s reputation was impeccable. He attended both Yale and Cornell universities, worked for the US department of the treasury and the Federal Reserve. America’s largest newspaper, USA Today, called him the country’s most credible analyst. Yardeni even earned the honorific nickname “Wizard of Wall Street”.

Yardeni started speaking out on Y2K as early as 1997 and no one discussed the matter as much and as openly as he did. He spoke to the World Bank and the CIA, and he was a fixture at the annual forum of world leaders in Davos.

His dire words had an immediate effect. In the US, the White House formed a special task group, legislation was passed shielding companies from lawsuits emanating from the Y2K problem, insurance companies introduced special policies to cover the problem, and lawyers prepared themselves for a torrential flood of Y2K cases. According to the most conservative estimates, the American government spent 100 billion dollars fighting the problem.

So, what sort of horrible things happened in the end?

“Nothing. Perhaps two clocks showed the wrong date. It turned out to be completely uneventful.”

Some computer problems did occur though. In one casino, 150 slot machines broke down. The alarm system guarding an abandoned government building ceased to function, leaving its doors open that night. A client at a video store was charged thousands of dollars in late fees for a video more than a century overdue. Yardeni celebrated the new year at home, with his wife. When he woke up the following morning, the world was still there.

Afterwards, Yardeni quickly admitted he had been wrong and then withdrew from the public eye, remaining silent on the matter for a decade. Now, for the first time in almost ten years, he looks back on Y2K. Not on Wall Street. He doesn’t work there any more. Yardeni runs a small consulting firm from his home.

Your predictions did not materialise in the end.

“It is entirely possible that the problem never existed. It could also be that companies took action in time because people like myself sounded the alarm. In any case: when nothing happened and it turned out to have been a mistake all along, it was quite a relief.”

“I do blame myself for the fact that it seems the Y2K problem led to a recession. Quite a lot of money was pumped into computers to solve this problem. When nothing happened, that influx of cash dried up, contributing to the burst of the technology bubble.”

Does that mean you admit to contributing to the problem?

“It was never my intent to sow doom and gloom or cause depression. I am a family man and I don’t like to see people lose their jobs. But I did see a recession coming.”

At the time you called yourself “an alarmist”.

“I was trying to raise awareness because I felt business had to invest heavily in tackling this problem. Not because I thought people had to arm themselves or build bunkers. “

Still, your warnings had a seditious character.

“I was trying to garner attention – successfully I might add. Perhaps I stuck with it for too long. Maybe I should have called it proclaimed victory and called it quits six months before 2000.”

How could you have misjudged this problem?

“No doubt this was a major slip-up. The biggest in my career. Did computers end up breaking down? No. Did the recession I predicted occur? No. I admit to all that. But I do not regret a thing.”

But a lot of money was spent. The Wall Street Journal even said that an “end-of-the-world-cult” had perpetrated the “con of the century”.

“I think they were right about that,” Yardeni said, but after a moment’s reflection, he chose the offencive. “But if it really was a con-job, why did all those companies spent so much money?”

Perhaps because trustworthy authorities like you recommended it?

“Listen. Hold on. The executives in charge of major companies know what they’re doing. They won’t waste money on a false alarm.”

You are short-selling your own influence.

“I was not that important at all,’ Yardeni said, again pausing for reflection. “Perhaps I was credible and I had a good reputation – I still do, I think – but I did not invent Y2K. Besides, people were working on this day and night. They took it so seriously they spent a lot of money on it.

Some countries – Russia, Germany, and Italy – stood out because they spent no money at all.

“Yes”

And nothing went wrong there at the year’s end.

“Exactly.”

So what does that mean?

“That computers weren’t essential to those countries.”

What Edward Yardeni said in 1999

• “The communications’ systems of half of the world’s countries are at risk of imminent collapse.”
  
  
• “I am no longer certain that we have enough time to prevent a Y2K-recession.”
  
  
• “There is a 70 percent chance of a worldwide recession at least a serious as the one we had in 1973 and 1974.”
  
  
• “It worries me that nobody on this planet is trying to assess the consequences the computer problem might have for the worldwide food supply...it might be seriously disrupted.”
  
  
• “This is the American Titanic. There is an iceberg up ahead and we are still partying on the upper deck.”

Two more space station computers revived

By William Harwood, Spaceflight Now

Posted: June 16, 2007

Hoping for the best, space station commander Fyodor Yurchikhin and flight engineer Oleg Kotov hot wired two computers aboard the international space station today that engineers had feared were victims of fatal power supply failures. To everyone's delight, the machines promptly booted up and appeared to be running normally, two more successes in an improbable recovery from crippling computer crashes last week.

Two of the three computers making up the Russian segment's guidance, navigation and control computers, along with two of three central control computers, were successfully revived Friday when Yurchikhin and Kotov used jumper cables to bypass suspect surge protectors in secondary power supply circuits.

The redundant so-called soft switches were designed to shut off power to their respective computers in the event of surges or spikes in the incoming electricity. Engineers now believe the installation of a new solar power truss last Monday triggered a subtle change in the station's power grid that somehow caused the secondary power supply switches to respond, preventing their computers from booting up.

Read More ....

Space station computers to be replaced - where's the hot site?

By Stan Beer, ITWire

Saturday, 16 June 2007

As the International Space Station management rushes to reassure the public that a US$100 billion plus project is not going to drift off into space, the latest reports circulating through the world media suggest that the entire bank of failed Russian computers may have to be replaced. The entire episode highlights hopelessly inadequate operational computer systems and, as each day passes, management with its back to the wall issuing conflicting reports.

One minute we are being told that the computer power supplies need to be replaced; another minute suggestions emerge that the entire bank of computers needs to replaced. Then we are told that the space station crew will be able to stay aboard; if they have to leave, though, the space station will be able to survive without a crew for a few months.

Amid all the conflicting reports, incredible as it seems, no-one has been able to pinpoint exactly how and why the computers failed. The prevailing view is that a power surge, caused by bringing a new solar panel array online, was the underlying cause. If so, the question remains as to how it came to be that mission critical computer systems were not isolated from such a surge.

Read More ....

Cause of computer breakdown on international space station still unknown: Russian official

International Herald Tribune

Published: June 15, 2007

MOSCOW (AP) : The crew of the international space station and support staff on the ground have been unable to pinpoint the source of a computer failure on the orbital outpost's Russian module that is affecting its orientation, a space official said Friday.

The six computers in the station's Russian segment broke down earlier this week, and attempts to find the reason and fix the problem have failed, said Valery Lyndin, the spokesman for Russia's Mission Control outside Moscow.

Lyndin stressed that "the lives of the crew are not in danger" and there were no plans to evacuate the crew. He said the station's oxygen-regeneration and all basic life-support systems were functioning properly.

However, he said, the station's orientation system was affected, because the broken computers control thrusters on the Russian module that are fired to orient the station toward the sun so its solar panels can soak up the maximum amount of energy.

Read More ....