Pressure increases on CEO Tom Seymour over PwC tax leaks

07 May 2023 Consultancy.com.au 4 min. read
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With hundreds of millions of dollars at stake, the latest revelations in the PwC government tax scandal may have left CEO Tom Seymour’s position untenable; himself being potentially aware of the breach.

PwC’s Australian CEO Tom Seymour is under increasing pressure following a string of recent revelations surrounding the leak of confidential government tax policy to clients – the latest being that Seymour himself was possibly aware of the breach.

The story has been bubbling away since the suspension of former PwC international tax lead Peter Collins by the Tax Practitioners Board watchdog, but is now escalating into full-blown scandal territory.

Tom Seymour, CEO, PwC

Collins departed the firm last October, with a subsequent investigation finding he had shared privileged information with unauthorised overseas PwC partners, garnered during advisory sessions with the government on potential legislation to combat multinational tax avoidance. Those partners were said to have passed on the details to clients in turn, with the TPB noting that senior members of PwC’s local tax practice likely knew of the transgression.

While no specific allegations were made against any further individuals at the time, or even confirmation of an ongoing investigation, the TPB’s ruling cited internal PwC communications which indicated an awareness among a certain number of email recipients that the confidential inside information gained from the Treasury consultations would be leveraged for marketing purposes, as well as “to influence the tax structures of existing clients”.

Despite censure from the TPB for failing to properly manage its potential conflicts of interest, and several public rebukes from the government since the breach came to light, PwC and Seymour have consistently downplayed the numbers involved and any concerns there may be a wider cultural issue at the firm, dismissing the affair as largely a ‘perception’ problem – even in the face of a senate probe and early evidence heard from TPB chief Michael O'Neill.

Those internal PwC emails were last week published by the Senate Estimates committee, sans identifying addresses, and the damning nature of their content has left most commentators astonished that the firm and Seymour as CEO would even attempt to minimise its degree of culpability, and especially with what now appears as legal semantics. Perhaps only the one partner was ‘technically’ guilty of breaching confidentiality, but dozens are blameworthy.

In brief, the almost 150 pages of published evidence, which covers a period of two and a half years to early 2017, has more than four dozen PwC email addresses redacted, belonging to staff in Australia and abroad. They speak of internal conference calls to brief on proposals “leveraging Peter Collins’s insights”, requests for the secret draft legislation due to an abundance of interested clients, and being “aggressive in telling these relationships they needed to act early”.

Head of Tax

Seymour, who was head of tax at the time of the confidentiality breach before being promoted to the top role in 2020, has now outed himself as one of those partners potentially privy to the unethical behaviour occurring at the firm, while both backtracking somewhat in his stance as to the severity of the contravention of professional standards and simultaneously remaining defiant and seemingly in denial. He told the partnership on Friday that he would not be stepping down.

During that emergency partners’ meeting, as reported by the AFR, Seymour stated that up to eight partners had shared the leaked information, while another 30 to 40 had received the emails and were aware of the scheme. Still, he maintained the legal line that those emails didn’t themselves contain information breaching confidentiality, and contended that most of the partners involved weren’t aware of any actual breach until the regulatory investigation commenced.

Yet, if it’s demonstrated that Seymour was among those who were aware, or if he is found to have responded to the emails in any form other than immediately swinging the axe and referring the matter to regulators, then it’s difficult not to see him now falling on his own sword. For now, he is said to have told the partnership that those involved would be put through the firm’s “consequence management framework”, but it’s highly unlikely that will satisfy wider calls or accountability.