This is an HTML version of an attachment to the Freedom of Information request 'NNDR Credits'.


Reference:  FS50619844 
 
Freedom of Information Act 2000 (FOIA) 
Decision notice 
 
Date:  
 
 
6 February 2017 
 
Public Authority: 

Wandsworth Council 
Address:   
 
The Town Hall 
 
 
 
 
Wandsworth High Street 
London 
SW18 2PU
 
Decision (including any steps ordered) 
1.  The complainant requested from Wandsworth Council (“the Council”) 
information about credit balances on its business rate accounts. The 
Council withheld the information under section 31(1)(a) of FOIA. 
2.  The Commissioner’s decision is that the Council has correctly applied 
section 31(1)(a) to the withheld information and so does not require it 
to take any further steps to ensure compliance with the legislation.  
Request and response 
3.  On 29 September 2015 the complainant requested the following 
information under FOIA: 
“Under the Freedom of Information Act, I request a breakdown of 
credit balances accrued since your earliest records, for the 
amounts owing to all ratepayers within you billing area. This 
information does not appear to be available via the 
datasets published on your website. Please include the 
following information; 
a) Occupier (where possible) 
b) Full hereditament address 
c) Rateable value 
d) Property Description 
 



Reference:  FS50619844 
 
e) Billing Authority Reference Number 
f) Start Date of Account 
g) End Date of Account 
h) Value of unclaimed Credit Balance 
i)) Period within which Credit Raised 
I fully understand where the occupier is a sole trader, you are 
prevented from supplying us with the occupier name under the 
Data Protection Act. I would therefore reiterate that I am not 
asking for the occupier name in the case of sole traders 
and only requesting information relating to (b) to (i) above.” 
4.  The Council responded on 30 September 2015. It refused to provide the 
requested information on the basis that it was exempt from disclosure 
under section 31 of FOIA.  
5.  The complainant requested an internal review on 8 December 2015. The 
Council provided the outcome of the internal review on 22 January 2016 
in which it maintained its original position in relation to the application of 
section 31. 
Scope of the case 
6.  The complainant contacted the Commissioner on 7 March 2016 to 
complain about the way his request for information had been handled. 
He specifically complained about the Council’s failure to disclose the 
information that he had requested.  
7.  The Commissioner considered whether the Council was entitled to rely 
on sections 31(1)(a) to withhold the requested information. 
Reasons for decision 
Section 31 – Law enforcement 
Engagement of section 31(1)(a) 
8.  Section 31(1)(a) of FOIA states that: 
“Information which is not exempt information by virtue of section 
30 is exempt information if its disclosure under this Act would, or 
would be likely to, prejudice-  
 



Reference:  FS50619844 
 
(a) the prevention or detection of crime,” 
9.  The Commissioner initially considered whether the relevant criteria for 
the engagement of section 31(1)(a) were satisfied. These are: 
(i) whether the prejudice claimed by the Council was relevant to 
section 31(1)(a); 
(ii) the nature of the prejudice being claimed by the Council; and 
(ii ) whether there was a likelihood of the prejudice being claimed 
by the Council occurring. 
(i) Applicable interest within the exemption 
10.  The Council argued that disclosure of the information withheld under 
section 31(1)(a) would be likely to prejudice the prevention of crime. It 
explained that it believed that releasing the requested information would 
allow potential fraudsters to use the information to identify business 
entities which were entitled to claim credits on their accounts. Once such 
a business had been identified, there would be a number of avenues 
open to the fraudsters to seek to obtain funds. Based on these 
arguments, the Commissioner accepts that the prejudice claimed by the 
Council relates to the prevention of crime.   
(ii) The nature of the prejudice  
11.  The Commissioner next went on to consider whether the prejudice being 
claimed is “real, actual or of substance”, that is not trivial, and whether 
there is a causal link between disclosure and the prejudice claimed. She 
is satisfied that the prejudice being claimed is not trivial or insignificant 
and that there is the relevant causal link.  
(iii) The likelihood of prejudice 
12.  The Council argued that the disclosure of the withheld information would 
be likely to prejudice the prevention of crime. In the case of John 
Connor Press Associates Limited v The Information Commissioner 
(EA/2005/0005) the First-Tier Tribunal confirmed that, when 
determining whether prejudice would be likely, the test to apply is that 
“the chance of prejudice being suffered should be more than a 
hypothetical possibility; there must have been a real and significant 
risk.” (para 15). In other words, the risk of prejudice need not be more 
likely than not, but must be substantially more than remote. 
13.  The complainant noted that the Council had said that the disclosure of 
the requested information would be “an invitation to be dishonest”. 
However, he explained that he did not believe that it had provided any 
 



Reference:  FS50619844 
 
evidence or instances where fraudulent claims had been made nor had it 
shown any direct link between disclosure and fraudulent activity. Whilst 
he acknowledged that the Council had a duty of care, his view was that 
its refusal was based on “what ifs”. 
14.  The complainant went on to argue that that 90% of councils throughout 
England and Wales had freely provided the requested information, many 
of whom openly published the data on their websites. He queried why 
the Council’s approach differed from other councils.   
15.  In relation to this latter point, the Commissioner is aware that some 
local authorities have disclosed similar information to that requested by 
the complainant. She is also aware that some local authorities have 
refused to disclose this information when requested to do so under 
FOIA. She is not able though to determine what percentage of local 
authorities in England and Wales have or have nor disclosed similar 
information to that requested by the complainant.  
16.  The Commissioner notes, however, that even if a significant number of 
local authorities have disclosed similar information to that requested in 
this case, it does not automatically follow that all public authorities 
should disclose that information. She needs to consider each individual 
complaint that she receives on its own particular merits, taking into 
account the specific circumstances of each case and the evidence and 
arguments presented to her.    
17.  The Council informed the Commissioner that it considered that the 
publication of the requested information would be an invitation to the 
dishonest. It believed that potential fraudsters could use the published 
information to identify business entities which were entitled to claim 
credits on their accounts. Once such a business had been identified, 
there would be a number of avenues open to the fraudsters to obtain 
funds. These included: 
(i) Hijacking the company’s identity, before posing as the 
company to claim the funds; or 
(ii) Setting up fraudulent accounts in the name of the company in 
order to seek a repayment; or 
(ii ) Posing as the Council in order to approach the company with 
relevant details of the overpayment in order to acquire 
confidential information such as banking details. 
18.  In support of its view, the Council explained that there were new and 
sophisticated methods for defrauding large quantities of money and that 
fraudsters cost businesses £50 million a year by falsifying details on the 
Companies House database so that they could take on the company’s 
 



Reference:  FS50619844 
 
identity. It went on to explain that fraudsters carried out ‘company 
hijacking’ by falsifying details on statutory paper forms to have a 
legitimate company’s registered address or take on the company’s 
identity. It believed that the disclosure of the detailed information 
requested could provide these fraudsters with new targets and might 
result in the Council paying out monies in fraudulent claims.   
19.  The Council argued that it would also be possible to look through the list 
for those businesses which were owed significant sums and then set up 
fraudulent accounts in appropriate names and apply for repayment. It 
believed that the very significant amounts of money involved would 
clearly make it worthwhile to set up an organised fraud to take 
advantage of the situation. Whilst it acknowledged that there were 
safeguards in place to stop bank accounts being opened in false names, 
it was of the view that such controls could be circumvented by those 
determined to commit fraud.  
20.  The Commissioner was informed by the Council that: 
“If an individual obtained the details of credits on accounts that 
had yet to be claimed there is little to stop them from attempting 
to obtain the funds for themselves by writing in or completing an 
application form containing their bank account details. Normally a 
credit on an account is only revealed by it showing on a bill sent 
directly to the liable party of the account with the credit. This is 
essentially the first safeguard and reduces the risk considerably 
as that information stays out of the public domain. 
A suspicious refund application that resulted from a recent credit 
bill being dispatched would mean contacting the applicant via 
letter or email to request further proof of a genuine claim. Some 
of these sums are considerable so we are cautious in ensuring 
they are returned to the correct account.  
[The complainant] has requested details of unclaimed credits and 
by publishing that list it is automatically inviting claims which will 
be fraudulent unless the genuine owner happens to spot it whilst 
trawling the internet looking for their credits. In which case if 
they believe they have a credit they should have contacted the 
Council when originally notified.”  
21.  The Council raised concerns that it would not be able to assess which 
were real and which were fraudulent claims without a great deal of 
investigation. It noted that it did not have the necessary skills or 
resources to carry out such assessments and to obtain these would 
involve additional extra costs. If there was a risk of fraud, the Council 
 



Reference:  FS50619844 
 
stated that it would be placed under a duty as a responsible public body 
to ensure that the system was made as secure as possible. 
22.  The Council noted that there were already cases where fraudsters rang 
or texted residents purporting to be from the local Council, Valuation 
Office Agency or other company which dealt with changes to Council Tax 
banding or Business Rates revaluation. Fraudsters suggested that the 
rate payer is due a Council tax or Business Rates refund, then ask for 
personal and bank details to allow them to process the refund or 
payment. If a criminal were able to obtain the information requested on 
Business Rate credits, the Council believed that it would not only assist 
them in defrauding the Council but also companies who were due a 
credit. It was of the view that they would be able to target those on the 
list and as a result, provide details regarding the overpayment which 
might convince the company that they were speaking to a Council 
officer.   
23.  The Council also noted that fraud was a very real problem within Local 
Authorities both internally and externally and referred to a recent article 
concerning an officer jailed for the theft for stealing from Council tax 
payers accounts.  
24.  The Council went on to explain that it was constantly confronted by a 
variety of attempted frauds and considered that the publication of the 
information requested by the complainant would represent a clear 
danger of being a new avenue that fraudsters would be likely to seek to 
exploit.  
25.  The Council confirmed to the Commissioner that its policy was to refund 
all credits within 10 working days of receiving an application form which 
were processed once a week using a two tier checking procedure, one 
person to process the application form and one person to sign off the 
credit file. In the Council’s view, the disclosure of the withheld 
information would mean that it would need to put in place additional 
checking processes which would risk delays to legitimate refunds and 
would lead to complaints and claims for compensation on its already 
stretched resources.  
26.  The Commissioner is reticent to pass judgement on the procedures a 
public authority should put in place to try to prevent fraud in 
circumstances such as this as the procedures that may be appropriate 
will depend on a whole range of factors, some of which wil  be specific to 
a particular public authority. However, in light of the explanation 
provided by the Council of its handling of requests for business rate 
rebates, it does not appear to the Commissioner to be a relatively 
straightforward and inexpensive task for it to make effective changes to 
its verification procedures for refund claims so as to counteract the risk 
 



Reference:  FS50619844 
 
of fraud as a result of the withheld information being placed in the public 
domain.  
27.  As part of its arguments, the Council made reference to the decision of 
the First-Tier Tribunal in London Borough of Ealing v The Information 
Commissioner (EA/2016/0013) in which the Tribunal considered the 
application of section 31(1)(a) to an identical request for information to 
that made by the complainant in this case. However, the Commissioner 
notes that the Upper Tribunal in London Borough of Ealing v The 
Information Commissioner (GIA/2360/2016) has recently set aside the 
decision of the First-Tier Tribunal and remitted the matter for 
redetermination by an entirely differently constituted First-Tier Tribunal. 
Consequently, the Commissioner has not taken into account the views 
expressed by the First-Tier Tribunal in its judgement in coming to her 
decision.  
28.  As already noted, some of the information requested by the 
complainant, particularly the amount of credit accrued on a particular 
business account, is information that the Council uses as part of its 
security procedures in attempting to prevent fraudulent claims being 
made and in order to try to prevent any that are made being successful. 
As a consequence, the Commissioner accepts that the disclosure of the 
withheld information would facilitate an increase in fraudulent claims 
and make it more difficult for the Council to identify any such claims. 
Therefore, in light of this, the Commissioner is satisfied that the 
disclosure of the requested information would be likely to prejudice the 
prevention of crime. She consequently accepts that section 31(1)(a) is 
engaged. As it is a qualified exemption, she went on to consider whether 
the public interest in maintaining the exemption outweighs the public 
interest in disclosure. 
Public interest test 
Public interest arguments in favour of disclosing the information 
29.  The complainant informed the Commissioner that he did not believe that 
the arguments provided by the Council were a valid basis for withholding 
the information requested. In his view, this could be perceived as the 
Council retaining monies that did not belong to it, but belonged to the 
public, and hiding behind legislation in order to do so. 
30.  The complainant noted that the Council had argued that the provision of 
the requested data provided minimal benefit to the general public. He 
disagreed with this statement on the basis that the Council held £2.5 
million belonging to the public. He believed that it was therefore very 
much in the public interest to disclose the information. He queried why, 
if the Council actively pursued ratepayers regarding credits, as it had 
 



Reference:  FS50619844 
 
said that it did, the value of credits held by the Council was so high. He 
informed the Commissioner that his research suggested that many 
councils within London boroughs did not actively pursue the refund of 
overpayments and that, in the main, it was the London boroughs (ie 
those retaining the most monies) that refused to disclose the 
information requested. 
31.  The Commissioner notes the complainant’s arguments in relation to the 
Council’s decision to withhold the requested information. With regard to 
his point about the total amount of business credit owing at the time 
that he made his request, the Commissioner would observe that this 
figure will include credit owing to sole traders, which is outside the 
scope of the request. It may also include large amounts of credit owing 
to a small number of businesses. Additionally, it will presumably include 
credit owed to a significant number of businesses which have been 
informed by the Council that a refund is due and from which the Council 
is awaiting receipt of a completed claim form.   
32.  As regards the complainant’s argument that his research suggested that 
many local authorities in London did not actively pursue the refund of 
overpayments, the Commissioner is not in a position to confirm whether 
his research is correct. In any event, she is required in making her 
decision to consider the circumstances that specifically exist in relation 
to Wandsworth Council, which has explained to her the steps that it 
takes to ensure that businesses that have a credit balance on their 
account are made aware of this and encouraged to claim a refund of 
that credit. In the absence of clear evidence to the contrary, the 
Commissioner has to accept the Council’s explanation of its relevant 
procedures and accept that those procedures are followed by its officers.  
33.  The Council acknowledged that there was a public interest in it being 
open and transparent in respect of public funds. It explained that it was 
for this reason that it disclosed to the complainant the total business 
rate credits that it held, which, it believed, allowed for transparency in 
respect of public funds without incurring the risk of the fraudulent 
activity that it had identified. It was of the view that the disclosure of 
the company names and associated details that had been requested 
provided minimal benefit to the general public. It noted that it actively 
pursued companies regarding the credits on their accounts and so there 
would be no benefit to the companies in credit, or to the public at large, 
from the disclosure of the requested company names and associated 
details. 
 
34.  The Council explained that when an account first went into credit, 
companies were informed of the status of their account and provided 
with a refund form to complete and return to it. A credit note was 
automatically issued in order to notify the ratepayer/company. If they 
 



Reference:  FS50619844 
 
paid by Direct Debit and their account was live, then the credit would be 
refunded automatically by BACS. The Council confirmed that the credit 
balances were being reviewed on an ongoing basis and further to the 
initial credit notes raised when the credit was created, follow up notices 
were sent and would continue to be sent. It explained that this was a 
continuous process as the number of accounts in credit varied on a daily 
basis. In the Council’s view, this on-going process allowed for credits to 
be claimed in a timely manner by ratepayers through a secure process. 
35.  Commenting on the efficiency its system in ensuring that businesses 
claimed money that was owed to them, the Council explained that 
credits normally occurred when a business had closed down or moved 
and overpaid business rates, although equally backdated credits could 
be created through revaluation changes that included periods when 
several businesses may have been in occupation over a number of 
years. It went on to explain that it was possible that some businesses no 
longer existed or had been dissolved. The Council informed the 
Commissioner that it made every effort to write to the last known 
address or to the insolvency practitioner, who often claimed the credits 
months or years after the Council had contacted them because of delays 
in their processes. The Council stated that it was consistently active in 
resourcing credit tracing and that it worked hard to refund all that were 
due. It believed that its system was effective and up to a good standard. 
36.  The Council acknowledged that there was a public interest in disclosure 
to provide some transparency to the records that it held in respect of 
the administration of business rates in the borough. It believed that the 
information could be of interest to a very small minority of the public 
who might be entitled to a refund and had somehow failed to receive the 
Council’s notifications and reminders of their credit balance, as it might 
enable them to exercise that entitlement. However, it believed that this 
was outweighed by the wider public interest in maintaining the 
exemption. 
 
Public interest arguments in favour of maintaining the exemption 
37.  The Council argued that there was a public interest in ensuring that 
monies from the public purse, such as rebates on business accounts, 
were not fraudulently claimed and also a public interest in not making it 
easier for fraud to be committed.   
38.  The Council also argued that its current verification procedure for refund 
claims was simple and cost effective. It believed that disclosure of the 
requested information would result in additional verification processes 
needing to be implemented at additional cost to the public which 
appeared disproportionate to the benefits that would accrue from 
disclosure. The additional verification procedures would also be likely to 
 



Reference:  FS50619844 
 
slow the verification process, resulting in detriment to the genuine 
ratepayer which would be contrary to the public interest. 
39.  In relation to any new verification processes that might be needed, he 
Commissioner was informed by the Council that these would be likely to 
require the production of additional documents by those claiming a 
rebate which would place a new administrative burden on the majority 
of those legitimate claimants that did not currently exist. This would be 
compounded by the fact that the level of scrutiny of those documents 
would be higher than at present, given the increased suspicion that 
some of the claims (and associated documents) might well be 
fraudulent. The result would be that a new verification process would be 
likely to slow the rate at which credit balance claims could be considered 
and refunded, causing delay in all refunds and the likelihood of 
complaints, which would further burden the Council’s limited resources.  
 
40.  Overall the Council considered that disclosure of the requested 
information would result in the need to implement disproportionate 
steps and additional expense to the public purse to counter an increased 
fraud risk that did not exist at present. It did not consider this to be in 
the public interest. 
 
41.  The Council argued that a final factor that needed to be considered was 
the cost consequences to it of a successful fraudulent claim. It pointed 
out that in the event of a successful fraudulent claim, it would: 
 
(i) have incurred the cost of paying out to the fraudster; 
(ii) remain liable to the legitimate rate payer for an equivalent 
amount, raising the prospect of paying out twice; and 
(ii ) be faced with the cost (legal and incurrence of internal 
management time) of seeking to recover the funds wrongly paid 
to the fraudster. 
 
42.  In the Council’s view, it would not be in the public interest to expose it 
to such potential costs and expenses given that they would be funded 
from the public purse. 
 
Balance of the public interest arguments 
43.  The Commissioner recognises the public interest in transparency and 
openness in relation to the procedures and decision making of public 
authorities and that the disclosure of the requested information might to 
some extent help to increase openness and transparency in relation to 
the Council’s collection of taxes and the management of finances. The 
withheld information would provide the public with more information 
about the amounts of unclaimed business rate credits and would, more 
specifically, identify those companies that had to date failed to claim 
 
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Reference:  FS50619844 
 
back credits on their business rate accounts. However, the 
Commissioner notes that the former more general public interest could 
be largely met by the release of information about business rates credits 
which did not identify individual accounts, for example, by providing 
total figures for business rate credits.  
44.  The Commissioner has already noted the Council’s explanation that it 
sent notices to companies that had a credit on their accounts with 
instructions on how to claim refunds that were owing and also the steps 
that it took to remind relevant companies that did not initially make a 
refund claim.  
45.  The Commissioner also notes that the disclosure of detailed information 
about rate rebates owed to specific businesses would not benefit the 
public as a whole but only businesses that had outstanding rebates due. 
She assumes that efficient businesses would generally be able to 
identify when they were owed money by the Council and be able to 
claim that money back relatively quickly, particularly in light of the 
attempts that the Council has explained that it makes to alert them to 
any rebates that are owed and facilitate the claiming of those rebates. 
Consequently, the number of businesses potentially affected by any 
disclosure should not be large. In light of this and the attempts that the 
Council appears to make to contact businesses that are owed rebates 
and to get them to claim those rebates, the Commissioner views the 
public interest in the disclosure of the requested information as limited. 
46.  In this particular case, the Commissioner accepts that the Council has 
provided strong arguments as to how the disclosure of the requested 
information would be likely to prejudice its attempts to prevent 
fraudulent activity in relation to the claiming of refunds on its business 
rate accounts. This inevitably creates a significant public interest in 
favour of withholding the requested information. 
47.  In light of this, she believes that the public interest in maintaining the 
exemption outweighs the public interest in disclosure. She has 
consequently determined that the Council correctly applied section 
31(1)(a) to the withheld information. 
 
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Reference:  FS50619844 
 
Right of appeal  
48.  Either party has the right to appeal against this decision notice to the 
First-tier Tribunal (Information Rights). Information about the appeals 
process may be obtained from:  
First-tier Tribunal (Information Rights) 
GRC & GRP Tribunals,  
PO Box 9300,  
LEICESTER,  
LE1 8DJ  
 
Tel: 0300 1234504  
Fax: 0870 739 5836 
Email: xxx@xxxxx.xxx.xxx.xx  
Website: www.justice.gov.uk/tribunals/general-regulatory-
chamber  
 
49.  If you wish to appeal against a decision notice, you can obtain 
information on how to appeal along with the relevant forms from the 
Information Tribunal website.  
50.  Any Notice of Appeal should be served on the Tribunal within 28 
(calendar) days of the date on which this decision notice is sent.  
 
 
 
Signed ……………………………………………… 
 
 
Rachael Cragg 
Group Manager 
Information Commissioner’s Office  
Wycliffe House  
Water Lane  
Wilmslow  
Cheshire  
SK9 5AF  

 
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Document Outline