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REVENUE officials have been routinely posting out people’s confidential data in bulk and without proper security, a Sunday Times investigation has found. It undermines Gordon Brown’s claim that the loss of 25m child benefit records was the fault of a lone junior official.
The prime minister last week blamed the junior civil servant for the loss of two computer discs containing the personal and financial details of the claimants. He said they had been posted out in a clear breach of rules that all sensitive data in transit should be encrypted.
Revenue officials have admitted that similar personal data for hundreds of thousands of people have routinely been put on CD and sent by post without encryption. The practice has now been quietly stopped.
HM Revenue & Customs (HMRC) has been sending confidential personal information to pension companies, including Norwich Union and Legal & General, without encrypting it and despite the risk of identity fraud. The practice continued even after confidential employee data went missing in September.
Union representatives said that the junior official – who has not been disciplined – believed that he had been made a scapegoat when he had simply been following what were widely regarded as “pretty standard” procedures. “I just want my life back and for all this to go away,” he has told a colleague.
This weekend opposition politicians accused Brown of political opportunism in singling out the official. “HMRC had a systemic culture of carelessness when it came to handling confidential data, yet instead of taking the blame, Gordon Brown and his chancellor singled out a lone junior official,” said George Osborne, the shadow chancellor.
The government was also challenged last night to come clean over whether HMRC even has the capability to encrypt computer discs at its office in Washington, Tyne and Wear. Brown told MPs that this was required when sensitive data were sent out by the post. HMRC officials refused to comment this weekend.
Brown told the Commons that under “the Manual of Protective Security . . . any data that are sensitive . . . should be encrypted when in transit. That is the procedure, it was just not followed”.
However, The Sunday Times has established that HMRC halted the practice of sending out unencrypted data only after the loss of the child benefit database. Until the ban, officials were sending out unencrypted details on discs, including employees’ names, details of tax payments, National Insurance numbers and dates of birth.
Legal & General said that it had received unencrypted personal data from HMRC but would not disclose the number of their customers affected.
Norwich Union and Prudential also said they routinely received unencrypted data from HMRC by courier but were now reviewing the practice.
Last September HMRC lost the personal details of 15,000 customers of Standard Life and warned those affected. Despite the bungle, the pension company said last week that records were still being sent on unencrypted discs, but these were being sent by recorded delivery.
Investigators hunting for the two discs containing the details of all families with children under the age of 16 were yesterday focusing on the depots of TNT, the HMRC’s courier. Royal Mail is also conducting a search of its return letter centre in Belfast.
The claim by Brown and Alistair Darling, the chancellor, that it was a lone official who had breached the rules was starting to unravel.
A senior HMRC source said that only “two or three” managers had the passwords to download the missing database of child benefit claimants before it was burnt onto the discs. A senior HMRC official said: “Either a senior manager downloaded the information and gave it to [the junior official] or he did it after being given the password.”
All government departments are now reviewing their procedures. The Department for Work and Pensions yesterday admitted that it had sent “bulk” unencrypted personal data by computer disc in the post to other government offices.
It also emerged last night that a package containing hundreds of pension statements had gone missing after being sent on October 26 by the Scottish Public Pensions Agency to the NHS.
Data have also gone missing in a controversial government scheme in which the bank account details and incomes of public sector employees, pensioners and private home residents are sent to a private company for fraud checks on behalf of the Audit Commission.
The government faces legal action over the child benefit data fiasco. Privacy International, which campaigns to protect the public from government intrusion, has consulted lawyers and is to take a test case on behalf of 300 worried families who have contacted it.

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Why is HMRC using a private courier to deliver these discs? Is this yet another example of the Government's desire to run down the Post Office, by starving it of revenue so that they can privatise it because they will say it needs private finance? PS Surely this fiasco proves that ID Cards are dead in the water.
Brian , Liverpool,
I think it was Ronald Reagan who said that the worst 9 words uttered to anyone was....
"I'm from the government and I'm here to help".
I'm sure someone can think of an oppropriate line for our bunch of incompetents, but what bothers me apart from the fact that any meaningfull qualifications are not required in this department (it seems) is that some elements of a past criminal record can be deemed 'not relevant'.
Nice one
Phil, Preston,
Like cww, I hope the junior official will be protected and management or those higher up the ladder accept responsibility for their decisions. As a civil servant and ICT specialist I know it's very difficult to refuse a demand made by management which often hasn't got the foggiest idea what security, proper maintenance, outsourcing, or any ICT issue is about - let alone what risks are involved. Not using encrypting/encripted data is really unbelievable. Though no guarentee, mrs Baramy, in ensuring your account is not plundered through internet phishing and other means.
As someone else rightly remarked: sending any item by registered post will only ensure someone signed for it on delivery.
Good to hear legal action is being contemplated. Isn't it illegal to copy private and personal data without permission and not once but several times? Disregarding encryption and other tools to protect it and prevent further copying? Music CDs are better protected than private data.
Kate, the Hague, Holland
Petition protesting the ContactPoint database is here
http://petitions.pm.gov.uk/Databases/
Trust the state with personal details of every child in the country? eek!
emma, London, UK,
I would quite like to know how it is possible to lose anything in the post anyway. How does it happen when there is a destination written on it that could never be mistaken for another?
Anon, Edinburgh,
We are all, correctly, complaining about the way the government fails to protect our personal details.
I just wonder how may home computer users are equally lax. I have friends who keep all their financial dealings etc on home computers without even basic password protection. Apart from the possibility of hackers whilst on line, none seems to have considered the possibility that the computer might fail and need to be sent away for repair before data could be removed from the hard drive.
A semi-retired accountant friend kept a considerable amount of confidential data on his computer, and when it failed had to pay very highly for an expert to repair the computer at home in order that he could watch and ensure the data was not examined or copied. He now uses an program which keeps all the data fully encrypted when not actually in use and I advise all my friends to do the same - there is at least one very good program available free of charge and it is well worth the effort.
Brian E, London, England
you should immediately request that all of your personal data is removed from all and any HMRC computer databases and detabases that could be connected or "contaminated"
and that you will (subsequently and in my own time) apply to each and every bank for replacement account nos.
REMEMBER IT IS YOU THAT ARE AT RISK UNTIL YOUR ACCOUNT IS SECURED and as the Banks losses could be substantial they will endeavour to recover any losses from customers.
paul wilcox, newbury, berkshire
Will you trust this goverment to securely look after your medical record when it is uploaded (without your explicit and informed consent) to a central computer?
John Priestman, Huddersfield, England
Speaking of money, aren't you supposed to pay tax on gifts or money you give to people?
Why then has this guy who gave money to 2 people who donated it to labour not paid tax?
This is strange?
Gary O'Neil, London,
Does anyone else think it's strange that a junior clerk could download this amount of highly confidential data without some sort of internal control preventing it?
What other data could have been downloaded onto a memory stick and walked out the building - and then sold on? Would anyone even know it was missing?
Rob, Birmingham, UK
After this farce, I cannot imagine anyone in their right mind providing identity card information but how can it be a case of 'go to jail, go directly to jail' when Macavity has not built the prisons to hold us all?
C Smith, Chester,
HMRC must be in the dark ages. The post should never have been used. Encryption over an intranet would have been quick & cheap. Or getting a database to offer out only the non contentious fields or is their database useless? And access to the database ought to be controlled by someone senior. This is root & branch failure, not the error of some poor clerk!!
Keith, Hastings, UK
To Jenny in Petersfield Hampshire
Sorry to be crude, but I have a feeling your letter will fall on deaf ears and achieve nothing.
Imaad, Bradford, West Yorkshire
We are just as at risk from our own government than we are from foreign terrors, it seems.
Justin, Nr. Lincoln, UK
I once sent something by the courier company, TNT. Not only did they lose my stuff, they were absolutely horrible when I contacted them and asked what they were going to do about it. I don't recall ever being treated with such rudeness as by the MD of TNT. Go figure.
Judith G, Aspet,
Yes, role on identity cards, n.h.s. computerisation and the ultimate destruction of the citizens right to a private life. Gordo wants your money to waste, now he wants to know what you had for dinner last night. And if you object he'l probably hold you for 56 days (or ninety days) without charge as a suspected terrorist.
Diddly Do, Liverpool,
Does registered/recorded/tracked delivery actually guarantee that the item will not go astray. Does it not simply prove in whose hands the item was if it does go astray?
Tony Knight, Durham,
I am surprised that in comments about this fiasco people say that if only the discs had been sent by "Registered Mail" then there would not have been a problem. As far as I can see from the Royal Mail web site the there is no such thing as Registered Mail, only Recorded Signed For. This doesn't give you any additional security except a signature if it happens to be delivered. If it isn't delivered then you get the cost of your stamps back (been there, done that). Not much help!
Jon, St Albans, Herts
I would question the justification of sending personal data to public sector organisations at all. If these organisations require such information thay should ask me for it, not the government.
In any case, as the databases are outsourced there is no such thing as security so many 'unvetted' personel will have access to them. And it may be worth asking who has access to disaster recovery and routine backup copies.
Mike Poulsen, Reading, Berkshire
We will be writing to any government agency and private company that holds our personal details, asking for an epxlanation of their security policies when dealing with our confidential data.
My son's passport was recently posted back by ordinary second class mail from the Student Support Department of our local council. We were surprised it was not registered delivery: now we suspect that cutting down on mail costs is government policy, and hence a systemic carelessness.
Jenny , Petersfield Hampshire,
I cannot understand Britain's reluctance to use the computer to transfer information. In our country I can use the internet for the bank to check my account. Afteralll you transfer money by internet so I don't understand why not government information to another department. Very strange.
Renate Baramy, Ramat Hasaron, Israel
Is all this a kind of 'trial run' for a new form of internal terrorism?
jill piercey, flackwell heath,
I do hope this junior official gets all the protection and help he needs - considering what happened to Dr Kelly...
cww, suffolk,