PwC Boss Declines Australian Parliament's Request for Tax Leak Inquiry Details

PwC global chairman and CEO Bob Moritz has refused to comply with a request from the Australian parliament to share a copy of an investigation used to contain the tax leaks scandal to the country.

According to The Guardian, the firm cited legal professional privilege over a report by Linklaters but provided more information about the scope of the investigation and the conduct of those it mentioned.

The global firm has also not provided a copy of the report to its Australian subsidiary despite repeated requests by PwC Australia CEO Kevin Burrowes.

The decision would likely set up another showdown, with Australian politicians strongly criticizing PwC for not sharing the report and frustrating government agencies that believed it should be shared.

A document prepared by the international firm sought to assure Australian senators and regulators that the Linklaters investigation was thorough and independent.

The company told a Senate inquiry into the consultancy industry that "the investigation by Linklaters and counsel in multiple jurisdictions included forensic searches for documents as well as interviews."

"Linklaters analyzed the evidence across territories, made additional inquiries where necessary and provided legal advice to PwC International."

In September, when PwC International made public the findings of the Linklaters report, the firm said it found six employees who allegedly received confidential Australian government information that "should have raised questions as to whether the information was confidential."

The international firm told Australian senators that the employees in question "did not have reason to believe that the information should not have been shared with them."

It added that while the people involved might have "fallen short of PwC's high expectations that its people raise their hands in such a situation, this is not the same as having breached professional standards."

"Many of the recipients of emails relating to the [base erosion and profit shifting] initiative were international tax practitioners who routinely received updates on OECD developments at the time," the document prepared by PwC International wrote. "It is not surprising, therefore, that the receipt of OECD updates by tax professionals outside Australia, in and of itself, did not raise alarm among recipients or cause them to conclude a breach of confidentiality had occurred, absent any indications to the contrary."

PwC Australia also rejected claims that it was not cooperating with parliamentary inquiries and multiple investigations into the conduct of former partners.

In February, the Australian Taxation Office (ATO) officials told the Senate Inquiry that PwC International was likely to claim legal professional privilege over the Linklaters report.

ATO's second commissioner, Jeremy Hirschhorn, said that the government had no power to compel the document despite the public interest in doing so.

"It's fair to say that it would be hard for PwC International or PwC Australia to argue that they are unaware of the interest of the Australian people in that document," he said. "We have not been provided with a copy of the Linklaters report. It would be preferable, in the spirit of true cooperation, if that document was provided to this committee."