Tax authorities using social networking to help identify potential tax defaulters
System uses technology similar to that used by social media companies
Revenue is using a tool that uses technology similar to that used by Facebook to identify individuals who are likely to have tax liabilities.
Social networking is being used to track potential tax defaulters, new records show. The Revenue Commissioners is using a tool that uses technology similar to that used by Facebook to identify individuals who are likely to have tax liabilities.
The social network analysis system – known as “NetReveal” – draws on a wealth of information sources to help target tax fraud that may involve groups of people. Information used in the database includes material from the Companies Registration Office, VAT returns, National Property Price Register, legal judgments, asset registers and the credit information database Dun & Bradstreet.
The system helps to identify networks of people who are at a higher risk of being involved in tax fraud. “The networks are risk-scored based on the presence of risk indicators in the network,” one briefing document states. “These aim to identify potentially risky behaviour.”
It identifies individuals who have previously been involved in fraud or non-compliance and examines linked information such as shared bank accounts, addresses, phone numbers.
“The network scoring mechanism is essentially looking for collusive and risky behaviour in the network and this can be identified by recognising the presence of a number of risk indicators in the same network,” documents state.
The Revenue has conducted a number of pilot tests of the system involving about 20 officials across different regions.
Other records show Revenue is assisting tax authorities in other jurisdictions to collect information on potential tax defaulters. It received 1,500 requests for assistance from other EU member states as part of a data-sharing agreement between 2009 and 2012.
The Revenue made more than 800 requests over the same period. These typically related to VAT information, to verify whether products had been sold or bought legitimately by traders.