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Leads Program v3.0

Compliance Programs Branch
GST/HST and Digital Compliance Directorate

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Overview & Privacy Impact Assessment (PIA) Initiation 

Government institution

Canada Revenue Agency

Government official responsible for the PIA

Cathy Hawara
Assistant Commissioner
Compliance Programs Branch

Head of the government institution or Delegate for section 10 of the Privacy Act

Lia Jackson
Director
Access to Information and Privacy Directorate

Name of program or activity of the government institution

Compliance

Standard or institution specific class of record:

Leads Program
CRA CPB 428

Standard or institution specific personal information bank:

Leads Program
CRA PPU 423

Legal authority for program or activity

“The Minister shall administer and enforce this Act and the Commissioner of Revenue may exercise all the powers and perform the duties of the Minister under this Act.”

In relation to the COVID-19 pandemic, the authority to administer the following subsidies and programs is found under the Income Tax Act:

Subsection 275(1) of the Excise Tax Act

“The Minister shall administer and enforce this Part and the Commissioner may exercise all the powers and perform the duties of the Minister under this Part.”

The minister of national revenue has a mandate to administer and enforce the Income Tax Act and part IX of the Excise Tax Act. To carry out this mandate, the minister must collect information. In cases of non-compliance with the acts, the minister needs information from various sources to administer and enforce the acts. The authority of the minister to collect such information is understood in the general language of the mandate set out above.

Canada Revenue Agency Act

In April 2020, as part of the Government of Canada’s response to the COVID-19 pandemic, the Canada Revenue Agency started to administer the Canada emergency response benefit for Employment and Social Development Canada (ESDC).

Section 61 of the Canada Revenue Agency Act enables the minister of national revenue to enter into agreements to administer programs for other government or private-sector organizations.

Under section 61, subject to sections 63 and 65, the Agency may enter into contracts, agreements or other arrangements with governments, public or private organizations and agencies or any person in the name of His Majesty in right of Canada or in its own name.

Contracts with His Majesty

Under section 62, the Agency may enter into contracts, agreements or other arrangements with His Majesty as if it were not an agent of His Majesty.

Agreements to administer a tax

According to subsection 63(1),the Agency may enter into or amend an agreement with a provincial, territorial or aboriginal government to administer a tax or other fiscal measure if the agreement is in accordance with guidelines relating to agreements of that kind established jointly by the Minister and the Minister of Finance.

Application of the Federal-Provincial Fiscal Arrangements Act

Under subsection 63(2),the parts III and III.1 of the Federal-Provincial Fiscal Arrangements Act do not apply to an agreement entered into or amended under subsection (1).

Disclosure

Under subsection 63.1(2) of the Canada Revenue Agency Act, the Agency may disclose to the province or territory in which an individual resides the information collected in accordance with the agreement if, in their return of income, that individual authorized the Agency to provide the information to that province or territory.

The following Acts established the various COVID-19 benefits listed below, but the authority for the CRA to administer them was delegated by the Minister of Employment and Social Development through a letter of delegation.

Canada Emergency Response Benefit Act

Canada Emergency Student Benefit Act

Canada Recovery Benefit Act

Canada Worker Lockdown Benefit Act

Dental Benefit Act

Under section 11 of the Act, the Minister of National Revenue may provide services and carry out activities to support the Minister in the administration and enforcement of this Act and may authorize the Commissioner or any other person who is employed or engaged by the Agency or who occupies a position of responsibility in the Agency to provide those services or carry out those activities.

Rental Housing Benefit Act

Under section 8 of the Act, the Minister of National Revenue may provide services and carry out activities to support the Minister in the administration and enforcement of this Act and may authorize the Commissioner or any other person who is employed or engaged by the Agency or who occupies a position of responsibility at the Agency to provide those services or carry out those activities.

Underused Housing Tax Act

Under subsection 20(2) of the Act, the Minister may authorize any person employed or engaged by the Canada Revenue Agency or who occupies a position of responsibility in the Canada Revenue Agency to exercise powers or perform duties of the Minister, including any judicial or quasi-judicial power or duty of the Minister, under this Act.

Summary of the project, initiative or change

Overview of the Program or Activity

The primary role of the Leads Program is to coordinate and review all domestic leads received from the public to assist the CRA in identifying taxpayers who are not complying with their tax obligations. The Leads Program gives the public the opportunity to come forward and anonymously report suspected cases of non-compliance with the tax laws administered by the CRA. A lead is characterized by information, in any form, that detects potential tax or benefits cheating. Leads can also be submitted by a CRA employee who has identified a taxpayer’s non-compliant behaviour in the course of their assigned duties. Once a lead is received, it is reviewed and verified using information from CRA systems and possibly external search engines, and then sent to the appropriate CRA program for processing.

What’s New

Since the Leads Program submitted a PIA update in January 2020, there have been five significant program enhancements. The enhancements are summarized below. 

Leads involving the COVID-19 benefits and subsidies

In response to the COVID-19 pandemic, the federal government established benefits which provided temporary income support to individuals who stopped working due to the pandemic. The government also implemented subsidy programs to support businesses during the economic downturn. As a result, the Leads Program began receiving leads on suspected misuse of these benefits and subsidies in June 2020. 

Exchange of information between the Agency and ESDC

Leads are being received by the Agency and the Department, which relate to benefit program(s) that are being administered by each organization. To help assign the leads to the appropriate organization, the two exchange leads information.

New case management system

The leads case management system was updated to a new platform that increases efficiency and reporting capability for the program.

Leads involving the Canada dental benefit and the one-time top-up to the Canada housing benefit

The Leads Program began receiving leads on suspected misuse of these benefits in December 2022.

Digital Document Management Program

The Leads Program is now using an external service provider to digitize incoming mail and faxes.

Scope of the Privacy Impact Assessment

The previous PIA for the Leads Program was approved shortly before the COVID-19 pandemic began. Since then, there have been significant updates to program operations. Therefore the purpose of this PIA is to identify and assess privacy risks to personal information relating to the administration of the Leads Program activities and its related business intelligence activities. This PIA will be reviewed and updated as required. Since the Leads Program and the Offshore Tax Informant Program are separate program administrations, the Offshore Tax Informant Program falls out of scope for the purposes of this PIA. Further, the actions that result from a lead (for example, audits and investigations) are not in scope for this PIA.

Risk identification and categorization

A) Type of program or activity

Criminal investigation and enforcement / national security 

Level of risk to privacy: 4

Details:

Information provided to the CRA in the context of this program is used to identify and follow up on instances of alleged tax non-compliance. Although the majority of leads collected by the Leads Program are pursued by civil areas, a small number of leads could be referred to the CRA Criminal Investigations Program. Nevertheless, the risk has been categorized at the highest level based on the possibility of criminal enforcement activity.

B) Type of personal information involved and context

Personal information, including detailed profiles, allegations or suspicions, bodily samples and/or the context surrounding personal information is particularly sensitive. 

Level of risk to privacy: 4

Details:

Personal information about an alleged non-compliant taxpayer: 

Most of the personal information about an alleged non-compliant taxpayer would probably fit into risk category 3, since it is sensitive information that relates to things such as assets, financial transactions and property. However, a fraction of the personal information provided by a tipster about a lead subject could qualify as risk category 4, on the basis that it is essentially a suspicion or allegation about a taxpayer’s non-compliance conveyed to the Leads Program in confidence by another party.

Personal information about the individual submitting the lead:

Information that identifies or provides clues to the identity of the individual submitting the lead could be extremely sensitive personal information, particularly in rare cases where safety is at issue. The Leads Program is committed to safeguarding confidentiality.

To make sure that the Leads Program is not collecting personal information from individuals who submit leads and that they stay anonymous, the below mandatory and automated phone script is played to all callers of the tip line:

“Protecting your confidentiality is important to us. You will not be asked for any personal information, and if provided, it will not be documented. To preserve your confidentiality, our calls are not recorded, and our agents’ telephones do not have call display.”

The public online submission form indicates that:

        You will remain anonymous.

When you report suspected tax or benefit cheating (by submitting a lead), you will not be asked to disclose personal information about yourself. The protection of personal information is important, and the CRA is committed to protecting your identity. The CRA reviews all the information it receives from the public about suspected tax cheating and makes every effort to ensure taxpayers follow Canada’s tax laws. The CRA has strict protocols in place for handling lead information. The CRA will do all it can to protect your identity along with any information that suggests you submitted a lead, to the fullest extent possible under the law. For this reason, you will not receive feedback or updates after you submit information. This is because the CRA cannot disclose information about other persons.

CRA’s use of information and documents:

The information you provide is collected under the authority of federal tax and benefit laws, and it is protected under the confidentiality provisions of those laws, as well as by privacy laws that impose strict limits on what the CRA can disclose. The CRA may use the information you provide to make sure taxpayers meet their tax obligations and that claimants are entitled to benefits.

Personal information about others:

Information provided could include information about business associates, family members and friends of the lead subject including information that could implicate them in the non-compliance. 

C) Program or activity partners and private sector involvement

With other federal institutions 

Level of risk to privacy: 3

Details:

Within the CRA, lead information is shared on a strict need-to-know basis with other program groups, such as Audit, Non-Filer, and Criminal Investigations to assist in their workload development.

The CRA has a memorandum of understanding (MOU) with Employment and Social Development Canada (ESDC) to share leads related to the COVID-19 emergency and recovery benefits. ESDC and CRA receive small volumes of misdirected leads from the public that fall under the mandate of the other organization.

The Leads Program shares information related to the Canada Pension Plan with ESDC under an existing MOU.

At this time, the Leads Program has an MOU with Revenu Québec to exchange information. 

D) Duration of the program or activity

Long-term program

Level of risk to privacy: 3

Details:

The Leads Program is a permanent continuing CRA program with no scheduled end/sunset date.

E) Program population

The program affects certain individuals for external administrative purposes. 

Level of risk to privacy: 3

Details:

The program could potentially affect any taxpayer who is the subject of the information provided to the CRA through the Leads Program. The population includes personal and business taxpayers, as well as individuals associated with the businesses or trusts that are the subject of allegations provided by tipsters. The population may include a taxpayer’s family members and business associates. 

F) Technology & privacy

  1. Does the new or modified program or activity involve the implementation of a new electronic system, software or application program including collaborative software (or groupware) that is implemented to support the program or activity in terms of the creation, collection or handling of personal information?

    2. Risk to privacy: Yes

  2. Does the new or modified program or activity require any modifications to IT legacy systems and/or services?

    3. Risk to privacy: No

  3. Does the new or modified program or activity involve the implementation of one or more of the following technologies?

Enhanced identification methods - this includes biometric technology (i.e. facial recognition, gait analysis, iris scan, fingerprint analysis, voice print, radio frequency identification (RFID), etc.) as well as easy pass technology, new identification cards including magnetic stripe cards, "smart cards" (i.e. identification cards that are embedded with either an antenna or a contact pad that is connected to a microprocessor and a memory chip or only a memory chip with non-programmable logic).

Risk to privacy: No

Use of Surveillance - this includes surveillance technologies such as audio/video recording devices, thermal imaging, recognition devices, RFID, surreptitious surveillance/interception, computer aided monitoring including audit trails, satellite surveillance etc.

Risk to privacy: No

Use of automated personal information analysis, personal information matching and knowledge discovery techniques - for the purposes of the Directive on PIA, government institutions are to identify those activities that involve the use of automated technology to analyze, create, compare, identify or extract personal information elements. Such activities would include personal information matching, record linkage, personal information mining, personal information comparison, knowledge discovery, information filtering or analysis. Such activities involve some form of artificial intelligence and/or machine learning to uncover knowledge (intelligence), trends/patterns or to predict behavior.

Risk to privacy: Yes

G) Personal information transmission

Personal information is transmitted using wireless technologies.

Level of risk to privacy: 4

Details:

Online leads are submitted via internet connection to the Leads Program, but no personal information on a tipster is collected via the online form.

Internally, CRA employees can submit leads through the secure Intranet form. Therefore, there is a connection to the intranet. To fill out the intranet form, CRA employees need to use their LAN user ID and password. Their user ID is automatically populated in the leads case management system, which is only used by the Leads Program to contact the CRA employee if there is a system-related issue with the lead. In accordance with the CRA Guidelines for Handling Leads, lead information is not to be printed, copied, or attached to a taxpayer file, or any working papers or reports (paper form or electronic), including but not limited to the audit report, diaries, file notes, and the penalty report. These measures protect the privacy of the lead tipster and safeguard the existence of the lead, since they are not connected to the taxpayer file.

In addition, when the National Leads Centre is verifying the account number of a lead subject (SIN/BN), tombstone information from the T1/T2 systems becomes auto-populated in the case management system.

Supporting documentation is submitted by mail or fax and, at this time, cannot be sent online.

The Leads Program onboarded a digital mailroom enterprise solution at the CRA. Documents received via mail are digitized and stored in a portal for later access by CRA employees. eFaxes are also expected to flow through the portal before they are processed by a CRA employee.

Information is shared with ESDC. 

H) Potential risk that in the event of a privacy breach, there will be an impact on the individual or employee

Details:

The Leads Program follows the Storage, Disposal, Transmittal and Transport of Protected and Classified Information and Assets Directive as set out by the CRA’s Security Branch. In the directive, Protected B is defined as information that, if compromised, could cause significant injury to an individual, an organization, or the CRA. Protected C is defined as information that, if compromised, could cause extremely serious injury, such as loss of life or extremely significant financial losses (greater than $10 million), to an individual, an organization or the CRA. Classified is defined as information that, if compromised, could cause injury (Confidential), significant injury (Secret), or extremely serious injury (Top Secret) to the national interest. The Leads Program follows this security classification to make sure that information is appropriately safeguarded.

The majority of information that the program receives can be carefully safeguarded as Protected B. In cases where a tipster expresses fear for their physical safety due to submitting their lead, the program will safeguard the information as Protected C, based on the Security Requirements for Handling Protected CRA Information – Finance and Administration Manual. These are often abstract concepts to assess, because every lead file is different. The Leads Program offers training and practical examples to the National Leads Centre to assist in making an informed determination of security level at intake. 

 

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