Case Citation:

H v Chartered Accountant [2006] PrivCmrA 7

Subject Heading:

Improper disclosure of Tax File Number information.

Law:

Section 17 and section 49 of the Privacy Act 1988 (Cth), guideline 2.4 in the Tax File Number Guidelines 1992

Facts:

A chartered accountant was appointed administrator of a company in liquidation. The chartered accountant wrote to over one hundred employees of the company regarding their employee entitlement claims. Included in the correspondence to the employees was a complete list of each employees' superannuation claims and their Tax File Number information.

The complainant, an employee of the company in liquidation, wrote to the chartered accountant expressing concern, amongst other things, with the fact that their Tax File Number had been disclosed to other employees. The chartered accountant responded stating that the Tax File Number information and other information were sent to employees in error. The chartered accountant apologised for any inconvenience caused as a result of the incident. The chartered accountant also provided an explanation of the events leading up to the disclosure, advising that the list was generated in response to a request from the Australian Taxation Office for the employees' superannuation and Tax File Number information. The chartered accountant advised it had inadvertently included the list intended for the Australian Taxation Office with the correspondence to the employees. The complainant was not satisfied that the chartered accountant was taking the matter sufficiently seriously and wrote to the Privacy Commissioner seeking assistance and the imposition of 'sanctions' against the chartered accountant.

Issues:

Section 17 of the Privacy Act provides that the Commissioner shall issue Guidelines concerning the proper handling of Tax File Number information. Those Guidelines were issued in 1988. Paragraph 2.4 of the Tax File Number Guidelines requires that Tax File Number recipients only use or disclose Tax File Number information as authorised by taxation, assistance agency or superannuation law. In this case it did not appear that the disclosure of the complainant's Tax File Number information to other employees was done so in accordance with the Tax File Number Guidelines.

Section 49 of the Privacy Act provides that if in the course of an investigation the Commissioner forms the view that a Tax File Number offence may have been committed, the Commissioner shall discontinue the investigation and refer the matter to the Australian Federal Police or the Director of Public Prosecutions.1 The Commissioner therefore needed to consider whether the disclosures of Tax File Number information constituted a possible Tax File Number offence.

Outcome:

In the course of the investigation, the Commissioner formed the view that the disclosures might constitute a Tax File Number offence. The Commissioner advised the parties of this and referred the matter to the Australian Federal Police. The investigation was then discontinued but recommenced on advice from the Australian Federal Police that it would not institute proceedings for an offence in view of the nature of the alleged offence and its general impact.

The Commissioner then recommenced the investigation and decided that the chartered accountant had not satisfied the requirements of paragraph 2.4 of the Tax File Number Guidelines.

The Commissioner asked the chartered accountant to consider the sufficiency of the steps it had taken to address the inappropriate disclosure of Tax File Number information, and asked what steps it would take to ensure that such disclosures would not occur in future.

In consultation with the Commissioner the chartered accountant agreed to take a number of steps to resolve the matter. These included contacting the Australian Taxation Office to coordinate a process for employees to apply for a new Tax File Number if they wished to, writing to the complainant and all affected employees apologising for the disclosure of their Tax File Numbers and advising them of the process to obtain a new Tax File Number, reminding the chartered accountant's staff of their obligations under the Tax File Number Guidelines, and instituting Guidelines for the handling of outgoing mail to help prevent such an occurrence happening in the future.

The complainant remained dissatisfied with the outcome of the complaint. However, the complainant's proposed remedy, which was the imposition of sanctions on the chartered accountant, was beyond the Commissioner's powers. The Commissioner subsequently closed the complaint under section 41(2)(a) of the Privacy Act on the grounds that the chartered accountant had adequately dealt with the complaint.

OFFICE OF THE PRIVACY COMMISSIONER April 2006

Endnote

1. A Tax File Number offence means an offence against section 8WA or 8WB of the Taxation Administration Act 1953 or section 6 of the Crimes Act 1914 or section 11.1, 11.4 or 11.5 of the Criminal Code.