ICO declines to take action after 1000 HMRC customer records apparently altered in 2020 by Organised Crime Gang and used to make fraudulent claims
Rather hidden away on the Information Commissioner’s Office (ICO) website is information, disclosed under the Freedom of Information Act 2000 (FOIA), in relation to an ICO investigation of a security incident involving HMRC, and an organised crime gang (OCG).
It appears that, in June 2020, an OCG had used 193 genuine National Insurance Numbers (NINOs) which it had managed to “hijack” (it is not clear how) from external sources, and set up bogus Government Gateway (GG) accounts. This subsequently “enabled the OCG to carry out enrolments on the bogus GG accounts of genuine Self-Assessment customer Unique Tax References”, which in turn enabled the submission of fraudulent tax returns with the aim of the OCG being to make fraudulent expenses claims.
It was also discovered that details of 130 of the data subjects whose NINOs had been compromised were also used to “utilise” the DWP universal credit service.
HMRC did not become aware of this incident until 2 December 2020, and it notified the ICO (pursuant to its obligations under Article 33 GDPR) on 14 December 2020.
Details of the incident also appear to be contained in HMRC’s Annual Report for the period in question, where (at page 188) it refers to an incident involving 1023 people where “Personal information [was] used to make changes to customer records on HMRC systems without authorisation”.
There are many redactions in the information that the ICO has now published, but the headline point is that it did not view the incident as a serious enough infringement of HMRC’s obligations under GDPR so as to warrant a monetary penalty. The ICO noted that
…there is no indication that any of the originating personal data used to commit the fraud was obtained from HMRC.
However, it does appear that some people might have lost money, although this has since been repaid to them:
…any repayments due to genuine customers have been (or will be) made good…and therefore all the financial losses will be HMRC’s.
Also redacted are what would probably be details of systems changes that HMRC has taken or agreed to undertake as a result of the incident. These would, says the ICO
increase the protection applied to customer records and data and make stacks of this nature more difficult…
This wording suggests that the ICO felt that the level of protection had not been adequate, in line with HMRC’s security obligations under the GDPR. That being the case, the ICO must have decided that, in this instance, despite the infringement, it wasn’t necessary, or appropriate, to issue a fine or take other enforcement action.
The views in this post (and indeed most posts on this blog) are my personal ones, and do not represent the views of any organisation I am involved with.