Senate committee lashes PwC over tax scandal, alleges cover-up

The Senate committee that uncovered the PwC tax scandal has accused the consulting firm’s leadership of failing to co-operate with the inquiry in an attempt to minimise damage to its reputation and questioned whether the problems which caused the scandal are being addressed.

A second interim report by the Senate inquiry into the consulting industry released on Wednesday says PwC has continued to frustrate its investigations, and was scathing about the evidence provided by former chief executive Luke Sayers, now the president of AFL club Carlton.

“The committee has found it impossible to reconcile the different versions and recollections of events provided by the witnesses. The committee is concerned about the truthfulness of some of the evidence it has received and is left questioning the credibility of Mr Sayers’ evidence,” said the report, titled PwC: The Cover-up Worsens the Crime.

The committee also criticised the continuing use of legal professional privilege to protect PwC’s global business, which was involved in using the confidential tax information via Project North America.

“PwC has attempted to reassure the committee that it has already taken the appropriate actions in relation to Project North America. And yet, PwC continues to use legal professional privilege as a reason not to provide the Linklaters report (into PwC Global’s role in the scandal) to the committee,” it said.

“PwC’s continued refusal to provide the Linklaters report is symptomatic of its problematic engagement with the committee.”

While current PwC management have recognised the need for change to the firm’s culture, leadership and governance, the committee questioned its progress on that front.

“The committee is not convinced on the evidence provided to it at this point that such substantive change is forthcoming,” it said.

The tax scandal first came to light more than a year ago, but the scale of it was not revealed until May last year when the Senate committee released a cache of emails revealing the brazen attempt to use confidential government tax plans to cultivate fresh business from notorious corporate tax avoiders.