Business rates credit balances
Case reference FOI2023/01536
Published 27 September 2023
Request
Please can you provide me with the following information under the Freedom of Information Act 2000:-
All properties within your Billing Authority area where there is either a credit held on the account or there was previously a credit which has now been written on
• The fields required are all non-personal;
• Primary Liable Party Name (Business Name)
• Full Property Address
• Postcode
• Billing Authority Reference Number (Assessment Number)
• Current Rateable Value
• Credit Amount
• Date Credit Applies To
Response
We consider the information requested above to be exempt under Section 31 (1) (a) of the Freedom of Information Act 2000, which exempts information if disclosure would, or would be likely, to prejudice the prevention or detection of crime.
For many years, Herefordshire Council has disclosed information on business rates credit balances and write on's in response to Freedom of Information requests. More recently our business rates team have published on the council's website, on a monthly basis, a number of business rates datasets, which included a dataset detailing credit balances. However, the council no longer publishes credit datasets nor do we disclose information on credit balances or write on's in response to Freedom of Information requests. This is because Herefordshire Council, like many other local authorities, have recently been subject to related criminal offences, notably of fraud arising from false claims for business rates credits made by persons who were not entitled to receive them. It has been deemed highly likely that publishing / releasing information in response to requests, has aided the facilitation of these fraudulent claims against Herefordshire Council, which have resulted in financial loss.
As such we consider that the prejudice being claimed through the use of this exemption is 'real, actual or of substance' i.e. it is not trivial and there is a causal link between disclosure and the prejudice claimed.
This exemption is subject to the public interest test, and accordingly I have weighed up the reasons for and against disclosure as follows:
Reasons for disclosure in the public interest:
Openness and transparency in relation to the way in which public funds are collected and used.
There is an interest for the businesses concerned to know whether or not they have a credit balance / write on, on their account, so that they can claim these monies.
Reasons against disclosure in the public interest:
Providing details of credit balances / write on's owed to individual businesses would open our business rates system to abuse and criminal activity. As explained above, this information has, in the past, been disclosed in response to Freedom of Information requests and a credits dataset published on our website. However, fraudulent claims have recently been made against the council. It is highly likely that publishing / disclosing the information requested above would aid criminals to make such claims and provide vital information which makes the commission of such fraud much easier. Disclosure would increase the risk and rate at which we are targeted. The requested information can be used by those with criminal intent to hijack a company's identity, allowing them to pose as that company to the council in order to claim funds, set up a fraudulent account in the name of the company to seek repayment or pose as the council to approach a company with relevant details of the credit balance/ write on to acquire confidential information from them, such as that company's banking details.
Fraudulent claims cost the council - money is paid out to fraudsters, the council is liable for any legitimate claims (i.e. payment could be made twice), and there is also a cost associated with seeking recovery of funds paid to fraudsters. Potential losses to the council itself and to the public purse extend far beyond this particular matter when mosaic or precedent effects are taken into account. Such costs are not in the public interest.
We agree that the businesses concerned have an interest in knowing whether or not they have a credit balance / write on so that they can claim any monies owed to them. However, we consider this to be a private rather than a public interest. There is a general public interest in knowing the total amounts owing to businesses in credit balances / write on's but not in knowing the amounts owed to each individual firm, in conjunction with further information such as their hereditament address. Disclosure of the details for individual businesses does not advance the general public interest in this type of information.
Since the decision was taken not to publish / disclose the requested information into the public domain, which release under the Freedom of Information Act would essentially do, the council has increased its efforts to ensure businesses who have a credit balance / write on are aware of this and encouraged to claim a refund on that account. Efficient businesses generally identify when they are owed monies and act to reclaim it, particularly given the efforts which are made to alert them to credits due. As such the number of businesses affected would generally be small. By contacting relevant parties direct, this acts as a safeguard, as only they are aware of this information, and it is not made public. If the business decides to claim a refund then there are enhanced verification systems in place and extra fraud awareness training has been given to all officers working in business rates.
If we were to disclose the requested information, releasing this to the world at large, further additional checking processes would need to be introduced to mitigate against fraud, as the safeguard set out above would have been removed. Such disclosure, as we have experienced, increases the risk and rate in which we are targeted for fraud because the risk of fraud substantially increases each time it is disclosed into the public domain. Not only would this lead to additional costs, but it would result in delays in legitimate refunds and lead to complaints regarding slowness. If legitimate claims were delayed this would not be in the interests of the businesses concerned.
Similar decisions to that set out above have been supported by the Information Commissioner's Office in decision notices FS50619844, FS50643256 and FS50865388.
Taking the above into account I find the balance in favour of non-disclosure of the requested information in the public interest. Please take this letter as a refusal notice under S17 of the Act.
Documents
This is Herefordshire Council's response to a freedom of information (FOI) or environmental information regulations (EIR) request.
You can browse our other responses or make a new FOI request.