CH481360 - Managing serious defaulters (MSD) for specific customer groups: FIS (Fraud Investigation Service): general information
Source: gov.uk (2025-09-01)


This page and chapter are under review as the relevant content is also published in the technical guidance chapters of the Compliance Handbook (https://www.gov.uk/hmrc-internal-manuals/compliance-handbook), within Compliance checks factsheets (https://www.gov.uk/government/collections/hm-revenue-and-customs-compliance-checks-factsheets) and in Compliance checks guidance (https://www.gov.uk/guidance/hmrc-compliance-checks-help-and-support). If you use particular pages regularly, please email xxx@xxx.xx (mailto:xxx@xxx.xx) to let us know the specific content you find useful.

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From 3 December 2012 for cases settled in FIS where a penalty for a deliberate or a deliberate and concealed inaccuracy, failing or wrongdoing has been established and charged, the general guidance for Managing Serious Defaulters (MSD) in the Compliance Handbook applies, see CH480100 (https://www.gov.uk/hmrc-internal-manuals/compliance-handbook/ch480100). For MSD cases involving FIS Insolvencies see CH481370 (https://www.gov.uk/hmrc-internal-manuals/compliance-handbook/ch481370) and for FIS Securities see CH481380 (https://www.gov.uk/hmrc-internal-manuals/compliance-handbook/ch481380).

Additional guidance for cases worked under CDF procedures

Cases worked under Code 9 procedures - Contractual Disclosure Facility (CDF) may, in certain specific circumstances, be referred for monitoring where:
- no penalty has been charged, or
- the only penalty position is pre-FA07.
The guidance below should be followed where, in a Code 9 investigation, the caseworker considers monitoring is appropriate.

Post-FA07 cases where no penalty charged
- Where FA07 deliberate penalties would be due but are not charged (for example where there are means problems and neither of the conditions at EM5213 (http://home.active.hmrci/emmanual/EM5213.htm) applies) the caseworker will decide if the defaulter should or should not be put into the MSD programme.
- This will allow the caseworker the opportunity, in these limited circumstances, to place a case into the MSD programme where they consider the defaulter presents an ongoing risk to HMRC.
- The caseworker will tell the defaulter at the earliest possible opportunity that they will, because of their actions, be put into the MSD programme.
- The consideration of this decision forms part of the manager’s assurance process.
- The standard MSD referral process will apply using NPPS.
Pre-FA07 cases
- Where the penalty position relates only to pre-FA07 periods, the caseworker will decide if the defaulter should or should not be put into the MSD programme.
- This will allow the caseworker to not put into MSD inappropriate cases where a pre-FA07 penalty has been taken - that is, those at the very bottom end of the neglect spectrum.
- This will allow the serious defaulter from whom a pre-FA07 penalty has not been taken to still be put into the MSD programme when the caseworker recognises that the defaulter presents an ongoing risk to HMRC.
- The caseworker will tell the defaulter at the earliest possible opportunity that they will, because of their actions, be put into the MSD programme.
- The consideration of this decision forms part of the manager’s assurance process.
- The standard MSD referral process will apply using NPPS
Representation Process
- Any subsequent representation against inclusion will be sent back to the caseworker who will revisit the case and confirm or revise the decision to enter the case into MSD.
- The manager will review and countersign the caseworker’s reconsideration.
- The manager’s decision will then be sent to the Appeals and Reviews team who will carry out the final review and make the final decision.
A link to the MSD intranet page will be available from this page in due course.