Tax authority Skat is taking drastic action after a report by its ombudsman, Borger- og Retssikkerhedschefen, condemned the tactics and strategies used to investigate suspected tax fraud.
The report was ordered by the tax minister, Holger K Nielsen (Socialistisk Folkeparti), after a number of media reports that found Skat had broken its own guidelines.
In one instance, Skat went after former model Camilla Vest and her husband for allegedly avoiding taxes in Denmark. In 2011 the couple, who live in New York, were sentenced to 21 months in prison and fined 6.6 million kroner for tax evasion in connection with Vest’s modelling work in Denmark but the sentence was overturned by the Eastern High Court in November 2012.
Borger- og Retssikkerhedschefen was especially critical of practices that included accepting information about suspected tax cheats from third parties, forcing suspected fraudsters to accept plea bargains, using police to arrest suspects in order to freeze their assets and sending confidential information in the post.
“The cases that have been reported in the media have been very serious,” Nielsen stated in a press release. “I have made it very clear that I expect [Skat] to do what is necessary and clean up where it is needed. Skat’s management is doing that now and I want to underline that I am very happy about it.”
Following the critique, Skat announced the closure of its department for economic crime, which was singled out for not adequately documenting its claims and for exchanging information with the police.
In its place, Skat will establish a department for “special control”, as well as implement clearer guidelines for which when someone will be investigated by department and when it can co-operate with authorities such as the police.
Borger- og Retssikkerhedschefen also called for an investigation together with Kammeradvokaten, the state's external legal advisor, to establish whether Skat staff should face disciplinary action for unlawful behaviour during case work.
Jesper Rønnow Simonsen, the head of Skat, apologised for the situation and promised to take steps to improve the quality of their work in order to avoid similar situations in the future.