Tax board rejects PwC assertion only six international staff implicated in scandal

PwC’s assurance only six members of its international arm were involved in the tax scandal has been rejected during public hearings.

Senator Richard Colbeck has raised the international spread of the information. Picture: Martin Ollman

The Tax Practitioners Board says there are more than the six partners and staff from the international arm of PwC who were identified to have assisted the tax scandal.

PwC Australia has repeatedly pointed to an assessment conducted by law firm Linklaters of its misuse of confidential government tax briefings as clearing any staff and partners from PwC International.

Instead PwC said six staff from the firm “should have raised questions as to whether the information was confidential”, noting some had been disciplined but remained with the firm.

This is in contrast to the 63 PwC partners and staff named on a list handed to the Senate who the firm identified had received at least one email containing confidential information.

PwC has removed and named four partners from the firm over allegedly being associated with the tax leaks, as well as standing down a further nine partners over the scandal.

But speaking at Senate Estimates on Wednesday, TPB chief executive Michael O’Neill said PwC’s assurances that only six international staff were connected to the scandal were “not consistent with our own assessment”.

He said the TPB’s understanding of the extent of the spread of confidential information within PwC was “much broader”.

TPB chair Peter de Cure has previously told the Senate he had an idea who the “dirty six” PwC staff were that had been noted by the Linklaters review, noting they were in New York and California.

But the TPB and the ATO’s attempts to access the review from Linklaters of PwC’s international assessment have been repeatedly blocked by the firm, claiming legal professional privilege.

PwC International has also refused to hand over the review of PwC Australia’s new boss Kevin Burrowes, who was parachuted into the role by the global arm of the firm to rescue the local business in the face of the scandal. This came after PwC’s head of international tax Peter Collins was revealed to have shared confidential government documents, detailing plans to reform Australia’s tax laws, with members of the firm.

But ATO second commissioner Jeremy Hirschhorn said PwC Australia was in a position to identify the international partners and staff who received confidential information.

Tax Practitioners Board chair Peter de Cure, centre, appears before an inquiry into the integrity by consultancy services. Picture: Martin Ollman

“PwC Australia has the emails, maybe not all the emails but all the emails from itself and other countries, there might be emails from two other countries they were not copied in on,” he said.

“So it should have a very good idea of partners overseas that were involved in the confidential information and that is knowledge of PwC Australia directly.”

Senate Estimates heard PwC’s engagement with the government consultation process formed part of a wider effort by the firm to influence tax changes across the globe for the benefit of clients.

Liberal Senator Richard Colbeck said PwC “wasn’t just seeking to gain advantage here in Australia it was about gaining advantage in what was going to happen on an international basis”.

In separate hearings, Australian Federal Police also revealed investigations into the PwC tax leaks were now looking overseas.

Dubbed Operation Alesia, the AFP said it had designated the matter a “priority” and “sensitive” investigation, drafting in deputy commissioner Ian McCartney.

This came after Treasury referred the tax leaks to the AFP.

Greens Senator Barbara Pocock said the hearings into the PwC scandal had revealed the firm was “hiding behind legal professional privilege” to deny access to investigators into its actions.