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From The Times

November 22, 2007

Police step in as staff reveal other CDs have gone astray

A ‘calamitous breakdown in communication’ at Revenue & Customs has left thousands more people exposed to risk of identity fraud

Rajeev Syal, Francis Elliott and Andrew Norfolk

At least two more CDs that could leave thousands of people open to identity fraud have been reported missing by staff at HM Revenue & Customs this week, The Times has been told.

Police have started an investigation into the loss of the unencrypted files, which went missing in transit from tax offices in Washington, Tyne & Wear, and contain “sensitive information” including national insurance numbers and dates of birth. They were sent to offices in London and are yet to be accounted for.

The loss of these files are in addition to a series of recent blunders by HMRC, including the announcement this month that a CD-Rom that contained information on 15,000 Standard Life customers had been lost.

The latest disclosure will increase the pressure on Alistair Darling, the Chancellor, who faced calls yesterday for his resignation over the loss of details of 25 million Britons from the Washington office of HMRC.

The police investigation may be expanded as detectives search for at least four missing CDs. Each would be considered a treasure trove of information by fraudsters. A source said: “There has been a calamitous breakdown in communication that has meant that files were being sent from the Revenue offices without proper authorisation. Staff are only now realising the seriousness of the situation and admitting to handling or sending out unencrypted files. The police are aware of these.”

The allegations of newly missing files were made by members of staff at the tax centre, some of whom appeared to be unaware of the rules governing data protection. They told officers that the files were sent to offices in Central London and have not been accounted for. The files do not, unlike the two CDs lost in transit to the National Audit Office in London, include bank account details. However, the information could be used by fraudsters to apply for credit.

Officers were last night continuing their search at the HMRC’s three-storey offices in Washington for the CDs that were destined for the National Audit Office. Detectives are understood to be satisfied that the missing package never arrived at its intended destination. Officers were seen by staff peering down radiator grilles, looking under desks and sifting through stacks of unopened post in the hope of finding the missing CDs in an envelope.

Meanwhile, detectives are trying to piece together exactly what happened on October 18, when the CDs were posted. The Metropolitan Police Specialist Crime Directorate is conducting the investigation under the charge of Acting Assistant Commissioner Janet Williams.

There was no sign yesterday of the junior official at the child benefit office who has been blamed for the blunders that led to the information going astray. An HMRC spokeswoman would not confirm that he had been suspended but said that he would face disciplinary proceedings that could lead to his dismissal.

Further questions about the standards of data protection at HMRC were raised yesterday by a solicitor who works routinely with the prosecution arm of the HMRC. Shawn Williams, of Rose, Williams & Partners, a legal firm in Wolverhampton that deals with tax fraud cases, said that his firm frequently received discs that contained personal data from the HMRC with the password included. “Sometimes there is no security at all, sometimes there are instructions telling you how to access the data, sometimes the password is just written on a compliments slip and included with the disc,” he told The Times.

The HMRC has a history of losing sensitive information on unencrypted CDs. This month it emerged that it had lost confidential data on more than 15,000 people after a CD-ROM was lost in transit as it was sent from its office to the Standard Life pensions department in Edinburgh. A further CD-Rom containing data on customers of an unnamed second company was also reportedly missing. The Information Commissioner is investigating the breach involving Standard Life. A spokesman for the company said yesterday that HMRC and the police had not been able to locate the discs.

In August a laptop that contained sensitive financial details of about 400 people with ISAs was stolen after being left in a car. In May HMRC posted details of the family tax credits of 42,000 families to other people after an apparent “printer error”.

A spokeswoman for HMRC declined to comment on the disclosures by The Times last night. “We cannot comment ahead of the review,” she said.

Lines of inquiry

The Government has ordered five separate inquiries into the fiasco:

— Scotland Yard’s Specialist Crime Directorate is conducting the search for the two discs and looking for any criminal activity

— The Information Commissioner’s Office is examining a breach of data protection law. It has new powers to conduct spot checks on government data security

— The Independent Police Complaints Commission has been asked “to identify the causes . . . and consider whether relevant local and national policies and guidelines were complied with”

— Sir Gus O’Donnell, the Cabinet Secretary, will enlist security experts to ensure that every department and agency checked procedures for keeping data safe

— The Chancellor has also asked PriceWaterhouseCoopers to report on HMRC’s data security

As a society were longer seem to care much about anything. Why should we be surprised when the government and government departments have the same attitude?

We're forever whining about the War in Iraq, fuel prices, ID Cards and mislaid personal data yet will we ever do anything about them? I mean really, seriously do anything? No we won't, so shut up and get back to your wage slavery.

YaHozna, Edinburgh,

Fining Revenue and Customs is pointless - its simply the Taxpayer getting fined!!!

At the moment everyone hides behind "institutional failure" - which simply means no-one is responsible, or cares. The only way to get any civil servants to care is to make them personally responsible - fine (or jail) the individuals involved and you would suddenly see a LOT more care being taken!

We should also sack the minister responsible, years ago we would not have had to, but the days are long gone when any politician had the honesty to resign!

Mike Bibby, St Albans, England - not EU

It should be asked why we are paying 7m or more families Child Benefit in the first place. Surely all benefit to existing tax payers could - and should - be made through the tax coding system. Why are 40% tax payers receiving Child Benefit anyway? If benefit was paid through the tax system hundreds of civil sevants working in Benefit departments would not be required.

T Lovett, St Neots, Cambridgeshire

on the subject of incompetency, and the need for highly skilled workers in the civil service - particulalry the revenue departments.

3 years ago i joined HMCE and trained to be a VAT assurance officer - thats a VAT inspector to everyone else. I then spent a year and a bit completing the training programme. This is a very expensive training course. Now it is 18 months after i have finished training, and i have spent the last 15 of them working for a private sector firm as a consultant on much improved terms than when i was with HMRC. This might sound unusual, were it not for the fact that of the 12 people who i started training with, only 4 remain with the department. 1 of them was specificaly sent by a former and now current employer, to do the training.
Their training in this are is great!!

as for losing stuff i'm not surprised, we carried everything around and it would be easy for a few documents to fall out of a laptop case and go missing.

Much better out, UK,

Why are the Metropolitan Police Specialist Crime Directorate involved - there is no evidence to suspect a crime - just incompetence. This is not their area of responsibility.

Are there no real villains left in London to occupy these people in a more productive way.

Highly paid police offices peering behind radiators etc etc

How much will this cost and what are the likely results.

A recent investigation by the met cost nearly Â£1.5M and produced NOTHING!

R B, Lauzun, France

Managers and CEOs have over the years coated them selves in Teflon and surrounded them selves with Teflon warriors, the speak a language called Teflonese.
So some poor wee junior clerk is going to carry the can for this whilst the boss resigns and walks away with his trousers full of cash to a gold plated pensioned retirement.
Every time some thing goes wrong we hear the Teflonese speak. "We have instigated an enquiry to get to the bottom of this, it would be inappropriate for me to comment in advance of that enquiry." Teflonese for, "right thats bought us some time, now lets cook up a story to cover our arses, and save our bonus and pension, before we disappear and pop up in another gold plated old boys job," and so the wee clerk falls on his paper clip.
Bosses now boss by remote control, e-mail and text is the order of the day, they even hire and fire by text, targets and concepts are fired out on a daily basis, fusing and confusing the system. Broon you make me sick, what a sham.

Duncan, Glasgow, Scotland.

You can stick your identity cards where the sun don't shine.

The best thing you can do to protect us is resign.

NOW.

Bill Bird, Wallasey, Wirral

I am sad to report that even as the Prime Minister attempted to apologise for this debacle during yesterdays PMQT he could not do so without permitting one of his backbenchers to 'open' the apology 'opportunity', so avoiding addressing his words to the leader of the Opposition, nor could he do so without attempting to make the role of his government look less contemptible by stating that things would have been worse if the Opposition had been in charge. This is why the art of politics remains so discredited in the minds of much of the electorate and why this unelected leader's greatest contribution is likely to be in getting people motivated to remove him.

Mark Benson, Kingston upon Thames

Mark Benson, Kingston upon Thames,

To the person who said fine the IR.. Where do you think the money to pay the fine would come from?? You and me.. "idiot!

DH, Taunton, UK

The only solution to the real, underlying problem in the area of taxation is to simplify the process. So many politicians think (if they think at all) that complex structures can be run effectively at low cost. They are just wrong. Complexity requires high quality, very expensive staff and results in confused taxpayers, most of whom will never understand the details. And that assumes that you can get high quality staff to work in our tax offices. Few people with any talent would take that on while there are many better alternatives. Our tax and benefits system is a complex edifice built upon decades of political fudges and social preferences, some of which are aimed at fairness, some at social engineering. Just the tax credit system alone is a nightmare of endless revisions and reviews and potential overpayments. Time for a serious rethink in the name of producing a workable system that remains at least reasonably fair to all concerned, including the taxpayers!

Colin , Shrewsbury,

The incompetence of the Civil Service and Gordon Brown's government is unbelievable.

We need to protect our personal data - but how do we protect it from the government when we have to give them personal information by law?

I am sorry, Gordon Brown, but you saying "sorry, it won't happen again" is not enough - this multiple failure shows we just can't trust the government with anything.

Peter, London,

Never mind 'Old time and tired civil servant' at least you will be allowed to retire years earlier than the rest of us with a fat inflation proof pension.

George, Glasgow, UK

Yes and i'm sure that ID cards would have stopped all of this. Trust no one.

kinnear, ios, Cyclades, greece

There is the same problem here in the USA with ID theft. One remedy for such fraud would be to allow individuals whose NI numbers have been stolen to have the British government cancel those NI numbers and allocate new ones to the victims. Being a victim of ID fraud myself over here in the USA you cannot get new Social Security numbers. That is unless you're in witness protection and that's a whole new issue.

Peter, New York, NY, USA

I suspect that too few fellow 'posters' have yet got beyond the notion of HMRC incompetence, and government embarrassment.
Say that the discs are found tomorrow in a waste bin - have any of you never burnt a music disk?
How much would the personal particulars of 25m youngsters be worth over a long period of time to criminals?
How long would a criminal plan, and wait for a weakness in the system of complacency to obtain this information?
How much would this be worth - Â£billions over the next 50 years?

MikeM, St. Albans, England

Even if the CDs are found, how do we know that they have not been copied.

Richard, Oxford, Oxfordshire

Just a word to the Government. . .

Don't now try to persuade the general public on the need for ID cards, don't tell us why you need to know everything about me from my eye colour to what I had for breakfast and finally don't presume to lecture us on identity fraud and why we should look after our personal details.

Get your own house in order first!

But hey you won't bother asking us about ID cards anyway, they'll just miraculously be made compulsory, won't they.

Paul Moxon, Birmingham,

Incompetence of HMRC aside, what we desperately need to do is find these discs and asked questions later... Why on earth has nobody scrutinized TNT for the answer as to where these discs might be. Its possible and much more feasible that small time mail theifs who could identify the importance of this package might be working in TNT. Yes there are serious problems with the HMRC but until these discs and a possible thief are found then the HMRC can just wait in disgrace as far as I'm concerned.

CB, London, UK

I feel some compassion for the young guy, he can only have done what the system and protection allowed him to do.

Any data storage system that allows anyone to independently copy sensitive data is not fit for purpose. If this young junior worker had this degree of access - how many others could have burned discs?

Whilst I'm sure the vast majority of HMRC staff are loyal and trustworthy, if relatively open access is given to data this valuable and easily sellable then its obvious that its only a matter of time before someone will steal it (if they have not already).

David R, Ripon,

If you fine the IR it is actually us taxpayers who cover the cost not the IR. Sack the incompetent ministers who are supposed to be running the IR or better yet,

CALL A GENERAL ELECTION!

Andrew Williams, Stockton-on_Tees,

When the Nationwide Building Society lost a laptop with a 1000 customers details on it, they were fined Â£1,000,000.

How much will HMRC be fined for this cock up? And who will foot the bill? I guess it will have to be the general public!
Ah well, it's all good business for Equifax and Experian. I bet they won't be declaring a loss at the end of this tax year!

Kelly, london, uk

Cameron makes a big mistake playing the "Blame Game" as it will come back and "Haunt Him" if he ever becomes PM and another Civil Servant screws up..Was it not the Tories who suggested in John Redwoods report on reducing Red Tape to remove restrictions on Data Protection

Bill Rees, Truro, Cornwall

Why did they use TNT not http://www.gcda.gov.uk ?

The Governments own mail service?

tom, london, uk

This is a breach of the E.U data privacy act. If this was the US there would be a class action to sue the government.

N, London,

Quite so David - however disastrous things get to be, make sure you always help your mates out.

Jeremy Poynton, Fromeville, 51st State

Its time for a big big change,no prisioners,England have become a joke thats hard to take.We must change from the top down and very soon .Everyday it s another disaster and the same people are left in charge and we only knew whats covered up.Welcome to secondry modern England .

s fisher, london, England

Will we see the IR getting fined for this like they fine us? No, I doubt it. All their stupid mistakes will be paid by you and me. The tax payers. Get this stupid useless government out! Idiots!

Lucas Tatek, Herts., UK

He said Sorry. Thats made everything alright then!

Lucas Tatek, Herts., UK

Our masters have cut the Civil Service and cut and cut again. Experience and loyalty are not valued.
In my own department responsibilities which, 30 years ago, would have been given to a senior caseworker are now given to administrative grades. Micro management has led to greater inefficiency; I now spend 40% of my time working and 60% of my time showing that I have done that work.
With less time in which to do the work a lower standard is offered to management. So long as the computer shows targets have been met the quality no longer seems to matter.
I would hazard a guess that the junior officer who the minister has been quick to blame (and that is not going down well) had to meet a target for speed, and a target for economy. So putting discs in an envelope by Royal Mail or the local motorbike courier was the way to achieve that.
This sort of material should travel by a Department's own internal couriers, but security, cleaning, dispatch and suchlike are all outsourced now.

Old time and tired civil servant, Westminster,

It's a case of silk purses and sows ears.
You cannot make ministers out of failed solicitors,school teachers,postmen and trade union tea boys.

john garrett, colombo, sri lanka

Please, please, please let some good come of this fiasco. Let this be an end to the proposed National Health national database and to the proposed Identity Cards. It is clear these 'officials' cannot be trusted with anything important.

P Robbins, Cornwall,

I don't understand why these people aren't being prosecuted under the official secrets act. CDs with this quantity of information must surely have some official classification.

Alex, Sydney,

So one government department full of jobsworths is investigated by another department full of jobsworths, their findings are swept under the carpet, and presumably PWCs findings will be kept confidential.

When will public sector workers be held accountable for their actions? Private companies would be pilloried if they did this (as should TNT be).

Nick Brennan, Benicassim, Spain

"The Chancellor has also asked PriceWaterhouseCoopers to report on HMRCâ€™s data security "

Kerching! One more nice little earner for the consultants,

David, Braintree,

Who was paid by whom to mislaid the CD's as well as all the other data that has disappeared in the last few month?
Who benefits from all this ?

There is none so blind than those who do not want to see.

Milvus, Loule, Portugal