Five to fifteen thousand citizens have been wrongly refused municipal debt restructuring by the Tax Authorities. This is apparent from an estimate by the tax authorities, writes State Secretary Hans Vijlbrief (Finance, D66). Thursday in a letter to the House of Representatives. The victims were refused because they were included in the controversial Fraud Signaling Facility (FSV), which was stopped last year because it did not comply with privacy legislation.
Vijlbrief writes that all files of citizens who “may have been wrongly rejected” will be reassessed. Some of the refused citizens later appear to have been eligible for a certain form of debt rescheduling, although the State Secretary acknowledges that some “have suffered a disadvantage because they have ended up in personal bankruptcy or in a process of compulsory recovery”. “I think this is a very serious possibility that requires appropriate recovery.” It has not been announced how the victims will be compensated.
The unjustly refused citizens had debts of 10,000 euros or more and requested an amicable debt restructuring process for this. In such a program, the municipality tries to make agreements with creditors to cooperate in a debt and payment arrangement. If the creditors, such as the tax authorities in some cases, refuse, someone can only apply for a legal process. The court then draws up a plan of action, in which it is determined in how much time debts will be repaid, how high the repayment amount is and that all creditors are obliged to cooperate with the plan.
The FSV of the Tax Authorities, which was in use from 2013 to the beginning of 2020, contained at least 250,000 citizens without their knowledge of this. They were labeled as ‘fraud’ on the basis of signals, although it often remained unknown what exactly that signal was. In some cases, these involved anonymous telephone calls to the tax authorities’ clickline. Because citizens were not aware that they were on the list, they could not defend themselves or be removed from the list.
The Dutch Data Protection Authority previously concluded that signals of fraud were also kept for too long and were not always properly investigated, which in some cases resulted in innocent people being duped. Citizens included in the FSV were often no longer eligible for a debt payment scheme and were subject to strict control regimes. Victims of the Allowances affair were also included on the fraud list.
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