The Australian Federal Police may expand the remit of an investigation of global consulting giant PwC over the firm’s use of confidential Treasury information to market tax minimisation schemes to potential clients.
The AFP also told a Senate Estimates hearing that it is re-evaluating multiple contracts with PwC for internal audit services, as it considers its own confidentiality arrangements with the consulting house and potential conflicts of interest that may arise through the PwC audit relationship.
The AFP has yet to formerly open a criminal investigation into the former PwC head of international tax Peter Collins’ improper use and “unauthorised disclosure of confidential Commonwealth information”.
But AFP deputy commissioner for investigations Ian McCartney told the hearing that the AFP would work to identify “other persons” beyond Mr Collins who may have committed an offence.
Mr Collins was banned by the Tax Practitioners Board in November last year for leaking and profiting from confidential information about changes to the Commonwealth tax system.
The matter was referred to the AFP for criminal investigation by Treasury secretary Dr Steven Kennedy on Wednesday evening.
Deputy commissioner McCartney told the hearing that while the investigation was at an “early juncture, the AFP would “work through that process and hopefully identify any other persons of interest we believe may have committed an offence or alleged to have committed an offence that will be included in the investigation”.
Mr McCartney also clarified that the referral for investigation focused solely on Mr Collins, but that the agency had the capability to expand the remit of the investigation.
“This matter is a sensitive investigation within the AFP’s construct. It’ll be oversighted by the sensitive investigations oversight board. And for us, it’s a priority investigation too. At this stage it’s just an allegation to investigate,” he said.
AFP commissioner Reece Kershaw told the committee that PwC would not be given access to any material if it is deemed to be relevant to the investigation of the tax leaks scandal.
“That would stop any – what we would call a problematic – intersection of say an audit or them trying to access information that would be intersecting across our criminal investigation,” Mr Kershaw said.
During the Estimates hearing on Thursday, AFP chief operating officer Charlotte Tressler said that in addition to the standard security vetting process and confidentiality agreements signed with PwC staff and partners, she had received assurances from a Canberra-based PwC partner that the audit services were being “managed appropriately”
Greens senator David Shoebridge asked Ms Tressler “who is the partner in PwC that’s giving you those assurances?” four times consecutively.
Ms Tressler was reticent on the name of partner, took the question on notice, and is seeking advice from the AFP chief counsel on whether the partner’s name can be provided to the committee.
PwC currently has nine contracts with the AFP, of which seven sit within an overarching audit contract.
Senator Shoebridge said he is concerned by PwC’s access to AFP documents through its audit contract and the conflicts this might cause the investigation.
The senator highlighted during the hearing that Treasury also had confidentiality agreements with PwC , but these “ended up not being worth the paper they’re written on”.
Ms Tressler said an assurance team within the AFP’s procurement function, as well as its audit and risk committee will soon begin a re-evaluation of federal police contracts with PwC.
She said the audit contracts were managed by the AFP chief audit executive and a wider internal audit team.
“[PwC doesn’t] just randomly go through the organisation. They are oversighted by an internal team who work with us to deliver our requirements. And we have been doing the work to ensure that we have the appropriate arrangements in place to manage our information,” Ms Tressler said.
