Fraudsters push the taxman offline
A criminal investigation is underway to expose fraudsters who have spoofed the identity of Work and Pension staff in a bid to falsify claims via the tax credit portal run by HM Revenue and Customs.
The service aims to speed up benefit payments to low-income families by making use of the Web, but the discovery of a number of bogus tax claims forced the portal to close on Friday.
In a statement issued on December 2, HMRC said action was underway to identify the culprits and ensure the online system remains secure, thanks to a new set of internet checks.
It added that the attempted fraud, which HMRC claims it prevented, centred on "internal information held about staff and not the external records DWP holds."
Whether the government fell victim to rogue employees, or if staff intranet systems were hacked is likely to be revealed at the conclusion of each Department's "in-depth" investigation.
Early signals from both Departments suggest the latter is more probable, given the government's admission it "will ensure no staff are disadvantaged as a result of it [the fraud]."
Although the statement relates to the treatment of officials rebooting the e-system, the Department for Work and Pensions said a hotline is also to 'go live' for staff fearful they have been victim.
The government said it is "working quickly" to ensure affected tax records are identified and corrected, without punishment for the members of staff whose identities have been spoofed.
It continued: "HM Revenue & Customs (HMRC) take fraud very seriously and as part of their ongoing compliance work have identified and stopped attempts to defraud the tax credit system by making claims through the tax credits e-portal.
"In the light of this, HMRC has closed the e-portal while it develops new checks to ensure that the system remains secure."
A notice on HMRC's main website states: "All other HMRC online services remain unaffected. We apologise for any inconvenience to customers but while the system is suspended they will still be able to contact us on our helpline, by post or face to face at IRECs as before."
It is not the first time Gordon Brown's flagship system has hit the headlines for the wrong reasons, after a £2bn IT-enabled overpayment of credits stung the poorest claimants, followed by reports that the e-portal was an easy target for fraudsters.