One of the most trusted consulting firms, PricewaterhouseCoopers (PwC)’s reputation has been shredded by a big tax scandal in the past few weeks.
The Australian Federal Police (AFP) has launched a criminal investigation into a former executive of PwC after he allegedly used confidential information from the Treasury Department to benefit the firm’s client base.
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On today’s The Briefing, we will find out how this happened and why it took so long to hit the headlines with Carl Rhodes, Professor of Organization Studies at the University of Technology Sydney.
Mr Rhodes said the core of the scandal was that the government had hired PwC to design a tax system that would make it more difficult for multinational corporations to avoid paying corporate tax.
However, on Wednesday, Treasury department secretary Steven Kenney issued a statement accusing the former head of “improperly using confidential Commonwealth information”.
The emails that the Tax Practitioners Board tabled in parliament on 2 May 2023 highlighted the significant extent of the unauthorised disclosure of confidential Commonwealth information and the wide range of individuals within PwC who were, directly and indirectly, privy to the confidential information,”
Mr Kenney said.
Mr Rhodes said this would be the “tip of the iceberg”, and it came down to whether the Australian government could trust private consulting firms to provide policy advice.
This suggests that at a fundamental level, we ask the question, can they be trusted? And in this case, the answer clearly is absolutely not.”
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