Dedicated to the taxpayers of Britain, and the employees of Her Majesty's Revenue and Customs (HMRC), who have to endure the monumental shambles that is HMRC.
PAC has criticised HMRC's use of the Regulation of Investigatory Powers
Act 2000 (Ripa) to examine the belongings, emails, internet search
records and phone calls of their own solicitor, Osita Mba, and the phone
records of his then wife.
The justification of the use of these powers by HMRC was that it wanted to find
out if Mba had spoken to the Guardian’s former investigations editor,
David Leigh.
A report by MPs on the Commons public accounts committee praised Mba
for exposing the “sweetheart” deal and called for further scrutiny of HM
Revenue’s use of Ripa powers.
“We consider that HMRC’s use of powers, reserved for tackling serious
criminals, against Mr Osita Mba was indefensible ... HMRC should tell
us when it makes use of the powers granted to it under the Regulation of
Investigatory Powers Act against whistleblowers from within HMRC.”
When HMRC turns on its own people, it seems to display a rather nasty streak!
Tax does have to be taxing.
Professional Cover Against the Threat of Costly TAX and VAT Investigations
Insurance to protect you against the cost of enquiry or dispute with HMRC is available from several sources including Solar Tax Investigation Insurance.
Ken Frost has negotiated a 10% discount on any polices that may suit your needs.
However, neither Ken Frost nor HMRCISSHITE either endorses or recommends their services.
Solar Tax Investigation Insurance is a tax-fee protection service that will pay up to £75,000 towards your accountant's fees in the event of an HM Revenue & Customs full enquiry or dispute.
As loyal readers may recall, I have on occasions bemoaned the fact that Budget Purdah is now a thing of the past.
It seems that one of the reasons (aside from flabby mouthed politicians) for the demise of Purdah, is the fact that an HMRC press officer was supplying The Sun with inside information in exchange for bungs. As per the Guardian:
"A reporter on the Sun newspaper allegedly paid £17,000 to an HM
Revenue and Customs (HMRC) press officer for confidential information
including leaked details of the 2010 budget, an Old Bailey jury heard. Clodagh Hartley, 40, Whitehall editor of the Sun at the time, was
“motivated by acquiring the next big scoop”, while her source, Jonathan
Hall, a senior information officer at HMRC, was “motivated by greed”,
the court was told.
Stories included details of the 2010 budget, published on budget day,
“so readers of the Sun were reading details of the budget before the
chancellor had got to his feet in the House of Commons”, said Zoe
Johnson QC, prosecuting. Most of the payments were paid into the account
of Hall’s live-in girlfriend, Marta Bukarewicz, “to cover his tracks”,
it was alleged. Bukarewicz then transferred the money to Hall’s account
“deceptively labelled as rent” and kept some money herself as
“commission” for “her unlawful efforts”, it was alleged.""
Hall has accepted that he supplied stories to Hartley for which he was paid.
Let us trust that this is a one off, and that Hall is the only bad apple in HMRC!
Tax does have to be taxing.
Professional Cover Against the Threat of Costly TAX and VAT Investigations
Insurance to protect you against the cost of enquiry or dispute with HMRC is available from several sources including Solar Tax Investigation Insurance.
Ken Frost has negotiated a 10% discount on any polices that may suit your needs.
However, neither Ken Frost nor HMRCISSHITE either endorses or recommends their services.
Solar Tax Investigation Insurance is a tax-fee protection service that will pay up to £75,000 towards your accountant's fees in the event of an HM Revenue & Customs full enquiry or dispute.
A whistleblower, who is a long serving employee of HMRC, has told the Times that HMRC is functioning in crisis mode, with thousands of calls
left unanswered and investigators cherry-picking the easiest cases.
The whistleblower claims that HMRC management have
instructed staff not to get into long discussions with people contacting
HMRC call centres, and not to ask additional questions. Some staff were given a maximum of five minutes to
talk to each taxpayer, and just 90 seconds to update their records.
Professional Cover Against the Threat of Costly TAX and VAT Investigations
Insurance to protect you against the cost of enquiry or dispute with HMRC is available from several sources including Solar Tax Investigation Insurance.
Ken Frost has negotiated a 10% discount on any polices that may suit your needs.
However, neither Ken Frost nor HMRCISSHITE either endorses or recommends their services.
Solar Tax Investigation Insurance is a tax-fee protection service that will pay up to £75,000 towards your accountant's fees in the event of an HM Revenue & Customs full enquiry or dispute.
Kay Sheldon, Care Quality Commission, Cathy James, Chief Executive, Public Concern at Work, and Osita Mba, former HMRC employee
Lin Homer, Chief Executive and Permanent Secretary, HM Revenue and
Customs, Jonathan Slater, Director General Transformation and Corporate
Strategy, Ministry of Defence, Chris Wormald, Permanent Secretary,
Department for Education, and Charlie Massey, Director General, Strategy
and External Relations, Department of Health
Lin Homer
had told the public accounts committee that phone records had been
obtained using the Regulation of Investigatory Powers Act (Ripa) to
unearth information about Osita Mba.
Margaret Hodge said that HMRC's use of the anti terrorism powers, ostensibly to track down whether Mba had been talking to the Guardian's then investigations editor, David Leigh, had "shocked her to her bones".
Hodge told Homer she was particularly surprised "that you made a request
under Ripa, which is there to deal with terrorism". She asked for
assurances that HMRC would "never again use these powers on a
whistleblower".
Homer of course wouldn't give such an assurance, as per the Guardian:
"You know that we cannot offer carte blanche
assurances for evermore that we won't use these … I have other duties of
care to parliament and other individuals."
Power corrupts, the more power given the HMRC the more liukely it is that it will be corrupted.
Tax does have to be taxing.
Professional Cover Against the Threat of Costly TAX and VAT Investigations
Insurance to protect you against the cost of enquiry or dispute with HMRC is available from several sources including Solar Tax Investigation Insurance.
Ken Frost has negotiated a 10% discount on any polices that may suit your needs.
However, neither Ken Frost nor HMRCISSHITE either endorses or recommends their services.
Solar Tax Investigation Insurance is a tax-fee protection service that will pay up to £75,000 towards your accountant's fees in the event of an HM Revenue & Customs full enquiry or dispute.
By happenstance, on the 29th of April, The Guardian provided a rather detailed and interesting update as to what HMRC have been doing to Mr Mba.
It transpires that HMRC used their powers, normally reserved for catching serious criminals (Regulation of Investigatory Powers Act 2000 - Ripa brought in by parliament on the pretext of catching terrorists), to search the belongings, emails, internet records and phone calls of Mr Mba and his wife.
For why?
HMRC wanted to prove that Mr Mba had spoken to the Guardian's former investigations editor David Leigh.
Seemingly HMRC could find no proof of any contact.
Cathy
James, the head of the whistleblowers' charity, Public Concern at Work, regards this as "sinister" and is quoted:
"The actions of the HMRC in this case are very much a
step in the wrong direction, more likely to result in a culture of
silence with more anonymous leaking than anything else. It is a case of
shoot – and silence – the messengers."
David Leigh,
who retired from the Guardian last month, said:
"The revenue's decision
to use these powers to try and find a link with a journalist when the
disclosure was so obviously in the public interest was heavy-handed and
foolish, and shows the level of paranoia over their tax deals."
Mr Mba's employment tribunal claim continues and is expected to
be heard in the autumn.
As I have noted before, the more powers that are granted to organisations such as HMRC the more they will abuse and misuse them.
I reproduce the full text of the Guardian's article below, comments and views are as ever always welcome.
"Tax officials used intrusive investigative powers meant to catch
serious criminals to try to prove that a whistleblower who uncovered a
"sweetheart" deal with Goldman Sachs had spoken to the Guardian, it has emerged.
The
belongings, emails, internet search records and phone calls of the HM
Revenue and Customs solicitor Osita Mba and the phone records of his
wife, Claudia, were examined by investigators, according to previously
undisclosed documents.
The powers, which are supposed to be used
to combat large-scale criminal tax frauds, were used because the tax
inspectors suspected that Mba had been in contact with the Guardian's
former investigations editor, David Leigh.
Leigh's telephone
numbers and email addresses were cross-referenced with Mba's, but
investigators found no evidence of contact, documents show.
The disclosure has prompted serious questions about HMRC's behaviour.
Cathy
James, the head of the whistleblowers' charity, Public Concern at Work,
said the decision to use intrusive powers to examine an employee who
made claims using whistleblowing legislation was "outrageous" and
"sinister".
"The actions of the HMRC in this case are very much a
step in the wrong direction, more likely to result in a culture of
silence with more anonymous leaking than anything else. It is a case of
shoot – and silence – the messengers," she said.
Using the Public
Interest Disclosure Act, Mba wrote to the National Audit Office (NAO)
and two parliamentary committees in confidence in 2011 saying that the
head of tax, Dave Hartnett, had "let off" Goldman Sachs from paying at
least £10m in interest.
Emails show Mba's identity was disclosed
to the revenue in October 2011 by the former clerk of the public
accounts committee, who had sought clarification that Mba was their
employee. The next day, a member of the HMRC's security staff sought to
obtain access to Mba's office cabinet beneath his desk in Whitehall.
"Thanks. Did you manage to get cabinet key number?" he asked a
colleague.
The man also received an email containing the
solicitor's private email address, his mobile number, his home telephone
number and his wife's telephone details.
On 11 October 2011, the Guardian published a story under the headline "Goldman Sachs let off paying £10m interest on failed tax avoidance scheme", written
by Leigh. Publication prompted members of the revenue's criminal
investigative unit to take action. One named internal criminal
investigator sent an email on 19 October to a colleague saying that the
revenue had begun "a review of the suspect's [Mba's] H drive [the hard
drive used within HMRC] and email traffic and internet usage", but
inquiries had revealed nothing.
He then proposed a "further
interrogation of computer material" and an "itemised billing check", and
wrote that "consultations with the CPS [Crown Prosecution Service] can
proceed".
Using the Regulation of Investigatory Powers Act 2000
(Ripa), HMRC can see websites viewed by taxpayers, where a mobile phone
call was made or received, and the date and time of emails, texts and
phone calls. According to the revenue website, these powers "can only
be used when investigating serious crime". But the papers disclose that
applications were granted to investigate Mba using Ripa.
On 21 October 2011, tax officials applied for an itemised billing request to check a mobile of Mba's, documents show.
One
document read: "David Leigh, who was given HMRC material discussing a
named taxpayers tax affairs advised a senior employee of HMRC that he
had been given access to that material on the 4th or 5th October 2011
and in it he quoted extracts from an HMRC minute of 8/12/2010. He was
clearly given information which if provided by an HMRC employee was in
contravention of CRCA [Commissioners for Revenue and Customs Act 2005]."
Ten
days later, another investigator sent a document, entitled leakupdate4,
to colleagues showing they had failed to identify any illegal activity
through IT checks, emails, intranet and internet usage and checks from
Mba's office telephone.
Investigators also circulated Leigh's
office and mobile number among staff so that they could be
cross-referenced with Mba's numbers.
A memo sent in December 2011 said the revenue had checked Leigh's details but found no evidence of contact with Mba.
Leigh,
who retired from the Guardian last month, said: "The revenue's decision
to use these powers to try and find a link with a journalist when the
disclosure was so obviously in the public interest was heavy-handed and
foolish, and shows the level of paranoia over their tax deals."
Mba was suspended from work, as the Guardian revealed on 8 December 2011,
when public accounts committee members warned revenue officials not to
harass or bully him. However, the organisation continued to receive and
detail his phone records, documents show. The inquiry was abandoned on
11 January 2012.
Mba, who trained as a barrister in Nigeria and
completed his master's degree at Oxford, worked in the personal tax
litigation team that dealt with the Goldman Sachs tax issue. He told the
NAO and two parliamentary committees that the bank's settlement had
been agreed with a handshake by Hartnett, the permanent secretary for
tax at HMRC.
Mba believed the deal could be illegal, and told
auditors he was making the disclosure under whistleblowing legislation.
His evidence led to Hartnett's being accused of lying to parliament over
his role in the Goldman Sachs deal, which he denied. He admitted,
however, that his organisation had made a mistake by approving the deal.
In
June 2012, Mba filed a claim under the Public Interest Disclosure Act
in the central London employment tribunal. In November 2012, HMRC
ordered Mba to return to work in a different team. In 2011, HMRC
was authorised under Ripa to view 14,381 items of "communications data"
on taxpayers while investigating tax evasion, compared with 11,513 items
in 2010, according to figures released under the Freedom of Information
Act.
The employment tribunal claim continues and is expected to
be heard in the autumn. HMRC declined to comment when contacted on
Monday."
Tax does have to be taxing.
Professional Cover Against the Threat of Costly TAX and VAT Investigations
Insurance to protect you against the cost of enquiry or dispute with HMRC is available from several sources including Solar Tax Investigation Insurance.
Ken Frost has negotiated a 10% discount on any polices that may suit your needs.
However, neither Ken Frost nor HMRCISSHITE either endorses or recommends their services.
Solar Tax Investigation Insurance is a tax-fee protection service that will pay up to £75,000 towards your accountant's fees in the event of an HM Revenue & Customs full enquiry or dispute.
Tax Investigation for Dummies, by Nick Morgan, provides a good and easy to read guide for anyone caught up in an HMRC tax investigation. A must read for any Self Assessment taxpayer.
