Senators demand names - Picking the wrong side: Why the PwC scandal just gets juicier
Rear Window
Tom Seymour, PwC’s fall guy
Joe AstonColumnistIn the end, Tom Seymour accepted his fatewith dignity. It was a stunning autumn day in Sydney as the head of PricewaterhouseCoopers, flanked by his loyal lieutenants, stepped onto the company yacht at Barangaroo wharf, an industrial meat grinder strapped to the starboard side. As they motored out past Sydney Heads, a sense of calm overcame him. He knew his kids would be looked after.
Whether you join an organised crime family or a legitimate professional services partnership, you agree to do other people’s time. And what a way to go. Finally, Tom found out what accountability really means. There was honour at the end.
Tom Seymour has resigned as CEO of PwC after a tumultuous week for the consultancy. Pete Wallis
As the executive board of partners assembled in a smoky back room, they raised a glass to Tom, the fall guy, the root cause of everything. Then they identified the tasks ahead: rent someone’s credibility for an inquiry whose findings are pre-determined by the narrowest terms of reference, drag out its completion well into next year and ensure the final report is never published. Raise their human shields (“a critical time for our firm and our 10,000 people”) and lie low behind them. Pray that everyone just forgets about this.
Of course, that all relies upon us believing the firm’s unbelievable assertion that “30 to 40” tax partners, experts in their field, didn’t know they were trafficking in secret government information when their practice was marketing tax avoidance schemes based on legislation that wasn’t yet public. Yeah, right. These guys heard treasurer Joe Hockey utter the words “base erosion profit shifting” and took them as a challenge.
It also relies on the idea that the right “consequence management framework”, in PwC’s words, has been adhered to here. What consequences would those be? Seymour is fish food, but who cares? He’s been having colonic irrigations with liquid gold for the past 15 years of his life. Disgraced partner Peter Collins is presently at home dusting his art collection.
PwC is still signing government contracts. The dirty 30 to 40 still have their tickets, they’re still in business, they’re still making bank.
It is now only a matter of time until the names of those partners, and the names of the 14 clients who used the tax avoidance schemes, are revealed. Treasury is seeking advice on whether crimes have been committed. The Senate’s inquiries continue. The Tax Practitioners Board has released the redacted emails, but not the final report of its investigation. Let’s see that! Remember, none of PwC’s actions that have to date been subject to scrutiny have withstood that scrutiny. None. So, what else has PwC done?
The bargain they’ve made
Remember, we’re only seeing the tiniest fraction of the communications in this heist because the firm has carefully constructed an artifice whereby all of its tax advice to clients is subject to legal professional privilege. PwC is quite cynically using legal privilege as an encrypted communications device, like the ANOM system preferred by outlaw motorcycle gangs.
The partners can be indignant, they can wail about the street justice of it all, but this is the game they’re in. It’s not just Tommy Seymour who has to wear the sentence, it’s also every principled person working in the organisation. They all have to suffer the reputational hit. When you’re a patched member of the PwC gang, that’s the bargain you’ve made.
Before he was whacked, Seymour blamed this on culture, yet a failure of culture is, by definition, a widespread one. None of the partners spoke up. They may not have known, but they were certainly party to a culture that allowed this to flourish.
The dirty 30 to 40 will be praying the entire cohort holds staunch, that none seeks the whistleblower’s solace of a clean conscience over the ignominious stench of the ongoing cover-up.