UK's families put on fraud alert
Two computer discs holding the personal details of all families in the UK with a child under 16 have gone missing.
The Child Benefit data on them includes name, address, date of birth, National Insurance number and, where relevant, bank details of 25 million people.
Chancellor Alistair Darling said there was no evidence the data had gone to criminals - but urged people to monitor bank accounts "for unusual activity".
The Conservatives described the incident as a "catastrophic" failure.
In an emergency statement to MPs, Mr Darling apologised for what he described as an "extremely serious failure on the part of HMRC to protect sensitive personal data entrusted to it in breach of its own guidelines".
MPs gasped as Mr Darling told them: "The missing information contains details of all Child Benefit recipients: records for 25 million individuals and 7.25 million families. "
The chancellor blamed mistakes by junior officials at HMRC, who he said had ignored security procedures when they sent information to the National Audit Office (NAO) for auditing.
Mr Darling told MPs: "Two password protected discs containing a full copy of HMRC's entire data in relation to the payment of child benefit was sent to the NAO, by HMRC's internal post system operated by the courier TNT.
The package was not recorded or registered. It appears the data has failed to reach the addressee in the NAO."
He added: "The police tell me that they have no reason to believe that this data has found its way into the wrong hands.
"The police are not aware of any evidence that it has been used for fraudulent purposes or criminal activity."
