Part 2 of our take on Government IT systems looks at the Register of Beneficial Owners and the meltdown that landed in the 2 weeks running up to the filing deadline of November 22nd 2019.
By way of introduction to this, the Register of Beneficial, which gives precise details of the ownership of corporate entities and provident societies in Ireland, was being established as a result of the EU's fourth money-laundering directive, commonly known as MLD4. The Companies Registration Office were tasked managing the register.
This was a whole new filing obligation for our clients, and as most of the information was held by accountants, they seemed to become filing agent by default.
To look deeper at the reasons for the failure, we first need to delve back to its setup and method of verifying data. Unlike a CRO or Revenue submission, this would not be accepted unless it was a direct match with the Depart of Social Protection database, this in itself caused many failed submissions caused by small spelling errors or people using their name.
The CRO said the common reasons for rejecting submissions include: entering incorrect dates of birth or personal public service numbers; using a middle name in everyday usage, but not using the correct forename that's registered with the department; using variations of a name and mixing up details of multiple owners.
Fast Forward to the deadline date… November 22nd 2019, 1 week after the extended tax deadline, effectively giving many accountants (normally taking a week or 2 off by now) a week of submissions to complete.
Submissions were initially straightforward, and if you had the information at hand, took about 5 minutes to complete. All was going well up to about lunchtime of the Monday when things began to slow dramatically on the RBO website due to the enormous volume of traffic. It was now taking 10 times longer to file a return (if you were lucky), and with all this came vastly increased contact time online.
Shockingly, RBO don’t have a phone line to help… who needs to talk to the filing agents trying to resolve the problem and make clients compliant!
Twitter appeared to be the main method of communications,
A near daily tweet became - “RBO Have no power to extend the deadline”
14 November 2019 – Website experiencing slowdown…
15 November 2019 – our technical team…
18 November 2019 - due to essential maintenance…
19 November 2019 – We are aware of issues…
20 November 2019 – Silence on IT failures
21 November 2019 – More silence
22 November 2019 – Full systems malfunction
€500,000 fine for all not filed to follow!
23 November 2019 – Extended to the 25th (previously impossible!)
Had there been a slight bit of forward thinking and set this deadline to say January 31st or a less pressurised date, much of this bottleneck could have been avoided.