PwC partner who allegedly helped her husband in a $3.3m fraud takes leave of absence

Hong Shao, accused of being involved in a $3.3m fraud scheme with her husband, has taken a leave of absence as the firm tells staff it had only just become aware of the matter.

Ms Shao in 2018 became the first China-born audit partner appointed by PwC Australia after several years at EY. Picture: Krisztian Bocsi/Bloomberg

Hong Shao, the Sydney-based senior PwC partner who has been accused of being involved in a $3.3m fraud scheme with her husband, has taken a leave of absence.

On Monday, The Australian revealed Ms Shao is a respondent in a case brought by Creative Promotions, which had employed her husband Di Wu since 2005.

Documents filed with the Federal Court allege that over 12 years to 2022, Mr Wu “obtained money dishonestly and fraudulently from Creative Promotions’’ by issuing fake invoices.

The money was allegedly sent to at least eight accounts at the Bank of China, JP Morgan Chase, Bank of America, the Agricultural Bank of China and HSBC.

The payments were allegedly routed back to Mr Wu’s Westpac account and a Bank of China account in Ms Shao’s name, and were used to buy a Porsche Cayenne and pay for renovations to the family home.

Some of these payments were labelled “school fee” and “living expense’’.

Other payments identified in the statement of claim have the transaction descriptions “new home”, “slab”, “gyprock” and “concrete pouring”, while $210,035 is alleged to have been paid to Porsche on May 27, 2021.

PwC partner Hong Shao has taken a leave of absence.

The pair paid $2m for the Lindfield property in 2016, at which time it was a modest, four bedroom, single storey home. It is now a double story, six bedroom, five bathroom, modern house with an estimated worth of $4.35m.

Ms Shao and Mr Wu are yet to file a defence in the matter and Ms Shao has declined to comment on the matter.

Sean Gregory, PwC’s chief strategy and reputation officer, told staff on Tuesday that Ms Shao had taken a leave of absence in order to respond “to this personal matter”.

“You may have seen media reports about a Federal Court claim involving one of our partners, Hong Shao and her husband, by his former employer,’’ he wrote in a note obtained by The Australian.

“The firm became aware of this matter yesterday.”

Ms Shao in 2018 became the first China-born audit partner appointed by PwC Australia after several years at EY.

The statement of claim lodged with the court alleges Ms Shao “assisted Mr Wu in operating the scheme’’ and “applied or was aware of the application of the proceeds … to the Pleasant Ave property, the NAB home loan, renovations and Porsche and to otherwise fund her lifestyle’’.

“Ms Shao had actual knowledge of the essential matters making up Mr Wu’s breaches of fiduciary duty pleaded … or, in the alternative, shut her eyes to the obvious; in the further alternative, wilfully and recklessly failed to make the inquiries that an honest and reasonable person would make; or, in the yet further alternative, had knowledge of circumstances that would indicate those facts to an honest and reasonable person,’’ the claim says.

“Ms Shao was ‘involved’ in Mr Wu’s contraventions (of the Corporations Act) in that she aided, abetted, counselled or procured, was directly or indirectly, knowingly concerned in or party to the contraventions or conspired with Mr Wu and possibly others to effect the contraventions.’’

Creative Promotions is seeking compensation and exemplary damages from both Mr Wu and Ms Shao. No charges have been laid against Mr Wu or Ms Shao.