AFP warns alleged tax leaks PwC partners face up to 10 years in jail

The AFP has warned its investigations into the PwC tax scandal are being frustrated by legal professional privilege claims on documents seized from the firm.

Former PwC employee Peter Collins. Picture: Luis Enrique Ascui

The Australian Federal Police have warned some of the partners at the centre of PwC Australia’s misuse of confidential government tax information risk up to 10 years in jail, as officers continue raids on the firm’s Sydney office.

Appearing at late night Senate Estimates on Tuesday, AFP assistant commissioner Stephen Nutt said the agency was examining four ex-PwC partners connected to the tax leaks, including some who are overseas.

However, Mr Nutt declined to name the PwC partners, only confirming the firm’s former head of international tax Peter Collins was central to the probe.

The Australian does not suggest Mr Collins is guilty of any crime.

AFP plainclothes detectives attended PwC’s Sydney headquarters in Barangaroo on Monday as part of a multi-day search of the firm’s records.

Assistant Commissioner Nutt said the firm had been notified of the raids on Tuesday last week, however he noted the residents of two homes in Victoria raided in August were not given forewarning.

Mr Nutt said it was “tactically beneficial” to have PwC notified of the upcoming search, noting the AFP was looking to access electronic records.

“Our view was it is a low prospect of loss of destruction of evidence, knowing that to our analysis of any material seized, we would be able to determine whether a material had been altered or destroyed as part of the collection,” he said.

Speaking earlier in the hearing, AFP acting commissioner Ian McCartney said the investigation into the firm was “complex” and hampered by the historical nature of the alleged offending as well as “the existence of derivative use immunity connected to other investigations, and legal privilege”.

However AFP declined to comment on attempts to claim legal professional privilege over documents, noting that police had engaged with PwC’s senior counsel “to work through what are the established guidelines for claiming legal professional privilege”.

“This is a common practice in complicated search warrants where legal professional privilege is expected to be claimed,” he said.

Greens Senator Barbara Pocock called out the issue, noting PwC attempted to stymie an earlier investigation into Mr Collins and the firm’s misuse of confidential government information through professional privilege claims.

“I have real concerns about its use, and clearly it is in use,” she said.

Mr Nutt told the hearing the AFP’s warrant presented when the firm raided several properties detailed police were investigating seven alleged offences in relation to the tax leaks.

These included breaches of section 70 and section 90 of the crimes act as well as a number of matters related to “general dishonesty” and “conspiracy to defraud”.

These offences could see PwC partners face up to 10 years in jail, if convicted.

Five PwC partners are also under investigation by the Tax Practitioners Board, which could see them banned as tax accountants.

Mr Collins was banned by the TPB in October 2022 in relation to the misuse of confidential information.

The TPB and the ATO are slated to appear later on Wednesday before the Treasury portfolio.