British Prime Minister Gordon Brown apologized and announced an investigation Wednesday amid angry questions about how private records containing banking details for about half the country vanished in the mail.
About 25 million people's personal data — virtually every family with children younger than 16, probably including Mr. Brown's own — went missing in the biggest-ever loss of personal information by any government.
Two password-protected discs containing the names, addresses, birth dates, and banking details of millions of people disappeared after a junior official mailed them to auditors without requesting confirmation of delivery.
The incident is a serious embarrassment for Mr. Brown who, as finance minister under Tony Blair, prided himself on restoring his Labor Party's reputation for economic competence and oversaw the creation of Her Majesty's Revenue and Customs, or HMRC, the body responsible for the loss.
During a bad-tempered weekly question-and-answer session with lawmakers in the House of Commons, Mr. Brown said, "I profoundly regret and apologize for the inconvenience and worries that have been caused to millions of families.
"When mistakes happen in enforcing procedures, we have a duty to do everything we can to protect the public."
He added that Britain's top civil servant, Cabinet Secretary Sir Gus O'Donnell, and security experts would make sure all departments and agencies check their data security policies.
The accounting firm PricewaterhouseCoopers will also investigate security procedures at HMRC.
David Cameron, the leader of the main opposition party Conservatives, alleged "systemic failures" at HMRC and called on Mr. Brown to "show some broad shoulders" and accept responsibility for the fiasco.
The incident has piled pressure on both Mr. Brown and Alistair Darling, his chancellor of the Exchequer, who were already facing criticism of their economic policy amid the crisis surrounding the troubled bank Northern Rock.
Mr. Brown insisted that no minister should resign over the affair, although Mr. Darling's previous reputation for quiet competence is now in tatters, observers said.
Both Mr. Brown and Mr. Darling say there is no evidence that the information had fallen into criminal hands.
Police are still searching for the discs.
Britain's Information Commissioner Richard Thomas, the personal information watchdog, told BBC radio that it was "almost certain" that the government had breached its data protection laws.
Banks have told customers to watch their accounts for signs of fraud.
HMRC Chairman Paul Gray, who only took up the role eight months ago after his predecessor quit over a multimillion-dollar fraud incident and error in the tax credits system, resigned Tuesday.