EY partner loses court fight to keep his identity suppressed

A sacked EY tax partner accused of cooking up a $700,000 tax exploitation scheme, has lost his court appeal seeking to keep his identity a secret.

The man’s identity will continue to be suppressed until March 20. Picture: James Gourley

A sacked EY tax partner has lost an appeal to keep his name secret after being accused of cooking up a $700,000 tax exploitation scheme.

But the man’s identity must be concealed until 4pm on March 20, after he secured an interim suppression order, while he weighs up an appeal against Federal Court judge Stewart Anderson’s decision on Friday.

Key parts of Justice Anderson’s decision have been redacted, but he said the former partner’s requests to appeal an initial refusal to suppress his name and to admit further evidence in support of it – which referred to the man’s “condition” and his mental state – were “untenable”.

The ex-EY partner’s legal team had attempted to lodge psychologist reports as fresh evidence, but Justice Anderson said they would not have resulted in a different outcome in Justice Geoffrey Kennet’s initial rejection of a suppression order application.

“I considered that only the second psychologist report was framed with anything like the precision required to support an application for suppression orders,” he said.

Justice Anderson said evidence about harm to the sacked partner’s mental health, “falling short of the risk of suicide”, may be sufficient to justify a suppression order.

But he was not satisfied with the evidence presented.

“While I accepted the evidence of the psychologist raised issues relating to the leave applicant’s health that were serious in nature, I was not satisfied that this was an exceptional case,” he said.

“The leave applicant also appears to accept that apprehended reputational damage is by itself not enough to warrant suppression orders.”

According to the judgment on Friday, the sacked EY partner had five consultations with a psychologist after he was told the first time his request for anonymity was refused.

“It is apparent from email correspondence between the leave applicant and the psychologist … that the 22 January 2024 letter and the psychologist reports were, to some degree, prompted by communications between the leave applicant and the leave applicant’s lawyers,” Justice Anderson said.

It is the second time the man has lost his bid to keep his identity secret, after Justice Kennet also refused to grant him a suppression order to conceal his name and those of his clients.

Justice Anderson noted another court case has been filed in the NSW Supreme Court by the former partner’s clients, who claim they were targeted in the tax scheme, where no suppression orders have been made.

“I considered this created a significant difficulty for the court in accepting that it was the disclosure of the specific allegations in this proceeding that would cause harm to the leave applicant’s mental health,” he said.

“That difficulty was not remedied by the filing of the psychologist reports.”

With his legal avenues reducing, if the former partner does not make an application to appeal Justice Anderson’s judgment by next Friday the suppression order will lift.

Ernst and Young outed itself in November last year as the big four firm where the ex-partner – who was sacked in August 2022 – worked when he allegedly carried out the tax exploitation scheme for some of his former clients.

The Commissioner of Taxation launched a Federal Court case against the man in August last year, claiming he had received more than $700,000 in allegedly “unauthorised” financial benefits from the tax scheme. He was terminated from the firm after he allegedly disclosed this to EY.

According to a redacted statement of claim released by the Federal Court, the scheme involved minimising the tax payable on profits from a sale of units.