The taxman has been defrauded out of £47million in a major sting that saw ‘organised crime‘ figures pose as up to 100,000 workers to claim bogus rebates.
HM Revenue and Customs (HMRC) revealed today that it had locked down tens of thousands of accounts – some real and some fake – that were used to extract cash for overpayment of PAYE.
Facing MPs HMRC’s chief executive JP Marks, who only started in the role a few months ago, said there had been a ‘small loss to the taxpayer’ as a result, and no loss to customers.
But he also revealed that it happened six months ago in December last year, and several arrests had already been made since by an international investigation.
It was left to his deputy, Angela McDonald, to reveal to the Treasury Committee the scale of what had happened.
She told MPs that criminals had been ‘phishing’ for personal details elsewhere which had then been used to access authentic HMRC account and set up fake ones.
Asked by chairwoman Dame Meg Hillier how much had been lost, Mrs McDonald said: ‘At the moment, they’ve managed to extract repayments to the tune of £47 million.
Now that is a lot of money and it’s very unacceptable. We have overall, in the last tax year, we actually protected £1.9 billion worth of money which sought to be taken from us by attacks.’
Facing MPs HMR C’s chief executive JP Marks, who only started in the role a few months ago, said there had been a ‘small loss to the taxpayer’ as a result, and no loss to customers.
It was left to his deputy, Angela McDonald, to reveal to the Treasury Committee the scale of what had happened.
HM Revenue and Customs said it had locked down accounts after an attempt to fake PAYE claims.
HMRC sent out a notification to customers today, saying they did not need to take any action.
Mr Marks told MPs on the Treasury Committee this afternoon: ‘It’s about 0.2 per cent of the PAYE population so around 100,000 people who we have written to or are writing to, to notify them that we detected activity on their PAYE account.
‘To be clear there has been no financial loss to those individuals, this was organised crime fishing for identity data, outwith of HMRC systems, stuff that banks and other people will unfortunately experience, and then using that data to try to create PAYE accounts to pay themselves a repayment and or access an existing account.
There has been a criminal investigation, some arrests were made last year and a lot of work then done to intercept this incident.’
Elsewhere, Mr Marks confirmed that HMRC phone lines were also currently down.
‘Something has disrupted those telephony lines and expecting them to be back up and available in the morning,’ he added.
