PricewaterhouseCoopers’ (PwC) Australia unit has taken action to prevent employees who were aware of tax leaks from participating in current or future government contracts.
This move comes amidst a parliamentary hearing and the commencement of a police investigation. The Australian police informed a Senate committee on Thursday that an investigation had been launched following a referral from the Treasury.
Secretary to the Treasury Steven Kennedy had stated the previous day that PwC Australia’s former head of international tax, Peter Collins, had “improperly used confidential Commonwealth information.”
The controversy surrounding PwC arose when it was revealed that Collins had obtained classified information during his tenure as a government advisor and shared it with his colleagues.
These colleagues subsequently used the information to provide tax-planning advice to multinational corporate clients. Emails dating from 2014 to 2017, which were released under parliamentary pressure, unveiled the extent of the collaboration between Collins and his colleagues in advising clients, including major US tech firms.
In response to the revelations, former PwC Australia CEO Tom Seymour and two other executives resigned. The company also announced an independent review of its governance, accountability, and culture.
A spokesperson for PwC Australia stated, “We note the statement from the Treasury Secretary and will continue to cooperate fully with any investigations into this matter.”
During the Senate hearing, deputy secretary for finance Andrew Jaggers stated that his department had not requested PwC to provide a list of the 53 partners mentioned in the emails.
Jaggers emphasized the need to avoid prejudicing any potential federal police investigation.
Finance Minister Katy Gallagher urged PwC to demonstrate to the government that it has implemented reforms in the way its partners and staff operate.
Gallagher acknowledged that changes had been made, highlighting the difference in leadership from those involved in the initial response to the current situation.
The conduct of PwC was strongly criticized by Clare O’Neil, minister for Home Affairs and Cyber Security, who described it as a “grotesque betrayal of trust.”
O’Neil emphasized the seriousness with which the matter is being treated, stating that a comprehensive government response is underway.
She asserted that the incident must be thoroughly investigated and those responsible held accountable.
While legal constraints exist regarding the cancellation of the government’s existing contract with PwC, efforts are being made to address the raised concerns within the boundaries of the law.
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