Consultants PwC “engaged in a deliberate strategy over many years” to cover up the misuse of confidential tax information, which was used to make the company at least $2.5 million, a senate committee has found.

In an interim report titled A calculated breach of trust, the Senate Finance and Administration Committee says former PwC partner Peter Collins shared confidential information about multinational tax avoidance – gained while consulting for Treasury – with colleagues in Australia and overseas.

“This put at risk $180 million per year of tax to be paid in Australia and generated new income of at least $2.5 million for what PwC envisaged would be the first tranche of its services to those clients,” the report says.

The report said the “aggressive monetisation” of confidential Commonwealth information made it clear that “the desire for personal gain trumped any obligations that PwC had to the Commonwealth of Australia and its citizens”.

Investigations stonewalled

It also accuses the company of stonewalling ATO investigations into the scandal by inappropriately applying privilege to tens of thousands of documents, and of attempting to minimise the seriousness of the scandal since it became public.

The question of exactly who inside PwC was involved in misusing confidential information remains unanswered, the report says.

It’s called on PwC to release the names of 63 people who received emails containing the confidential information which was handed to the committee but has since been redacted.

So far, PwC has stood down nine partners but chosen not to publicly name them. Earlier this month the company named four former partners as having received confidential information relating to the Multinational Anti Avoidance Law. Those partners were Peter Collins, Michael Bersten, Neil Fuller and Paul McNab.

Timeline of a scandal: how the events unfolded

December  2013 –  Peter Collins, then National Leader of International Tax Services at PwC, signs his first confidentiality agreement with Treasury to participate in confidential consultations relating to Australia’s multinational anti-avoidance tax laws.

January 2016 – The  new Multinational Anti-Avoidance Law ( MAAL) comes into force, designed to stop big overseas companies dodging tax.  

April 2016 – The ATO becomes of aware of companies working to sidestep MAAL and sends notices to four big accounting firms including PwC.

End of 2017 – The ATO finds “hints there had been a breach of confidentiality by Mr Collins”.

March 2018 – The ATO shares documents with the AFP. It’s decided after 12 months there isn’t  information for a formal investigation.

July 2020 – The ATO refers Mr Collins to the Tax Practitioners Board (TPB), which finds he shared confidential information from Treasury, knowing it would be leveraged to market PwC to a new client base.

January 2023– It is revealed that the TPB has terminated Mr Collins’ registration as a tax agent and banned him from reapplying for two years.

May 2023 – Tom Seymour stands down as PwC’s CEO, confirming he’d received information from  Mr Collins. He remains a PwC partner till September 2023. Acting PwC CEO Kristin Stubbins apologises in an open letter and announces an internal investigation.

June 2023 – PwC  provides the Senate Finance and Administration References Committee with list of 63 staff, including current and former partners,  who received confidential MAAL info. Some of those names, including the name of a company, have since been redacted.  The committee says it won’t be releasing the 63 names but says the onus is on PwC to do so.

‘Deeply disappointing

Treasury  has referred the matter to the AFP to consider a criminal investigation and an internal PwC report is due to be published in September. The committee is set to release its  final report is due on November 30.

Treasurer Jim Chalmers on Thursday described the events as completely unacceptable and a “deeply disappointing breach of trust”.

“What’s happened here is we’ve seen the consultation process trashed, and we need to get to the bottom of it,” he told ABC radio.

He said there were a number of parliamentary processes the Committee could use to compel PwC to provide the names but said it was important not to interfere with the AFP process.

Mr Chalmers aid it remained to be seen whether the matter is referred to the new National Anti Corruption Commission (NAAC).

“Understood, people are filthy about this for good reason,” he said. “And they want to see the maximum amount of effort to get to the bottom of it, to make sure that there is a price paid and to make sure it doesn’t happen again.

“I think it makes a lot of sense to have this committee process running, to have the AFP referral from the Treasury and all of the other things that we are doing. If there are other steps that need to be taken beyond that, obviously, we’ll consider them.”