Ex-PwC CEO Tom Seymour defiant after ban over tax leaks scandal
The PwC tax leaks scandal is far from over
The PwC tax leaks scandal is far from over Consequences for former CEO Tom Seymour are just the tip of the investigatory iceberg. Plus: a confession about my reporting.
By Edmund Tadros
The tax regulator has dropped the results of its investigation into former PwC CEO Tom Seymour – and his defiant response should surprise no one. Elsewhere in this week’s jam-packed newsletter, I make an AI confession, and note that a move by ANZ’s new boss will likely scare consultants across the country.
In this week’s issue:
On Tuesday morning, the Tax Practitioners Board quietly updated its profile of former PwC Australia chief Tom Seymour to include a “termination” finding.
The board, which oversees Australia’s 80,000 tax agents, found that Seymour had failed to act on signs that secret government information was being shared by tax partners at the firm.
It also ruled that he had allowed an unethical culture to develop within the firm’s tax division, and deregistered him. The board found that Seymour had breached the profession’s code of conduct by failing to act with “honesty and with integrity”, and failing to manage conflicts of interest.
Seymour’s response to the sanction is consistent with his response during the entire PwC tax leaks scandal. He says he accepted “leadership accountability” by standing down as CEO in 2023 – but denied any actual wrongdoing.
He also noted that he had not practised as a tax agent since leaving PwC in mid-2023 and had “no intention to do so in the future”.
“Given this, I will not be seeking review of the decision,” he said.
This is, unbelievably, far from the end of the saga.
There are still multiple ongoing probes into the scandal, including further investigations involving the TPB and a separate investigation by the Australian Federal Police (Operation Alesia).
Professional body Chartered Accountants ANZ will also look into it all once the official investigations are done.
And there’s a still-unpublished Treasury consultation paper about regulation of the sector, and the dozens of recommendations made across two parliamentary inquiries into the firm and the wider consulting sector.
Politics and the PwC ban
The story has attracted an unusual amount of political and public interest for the typically dry field of tax regulation.
Labor Senator Deborah O’Neill said the TPB’s action against Seymour was “a good start towards taking action that clarifies professional standards and expectations about leadership and behaviour in the audit and assurance sector”.
Greens senator Barbara Pocock said the action was “further proof of why we urgently need greater transparency and stronger procurement protections”.
Last week, Pocock introduced a private bill to ban dodgy contractors that have engaged in unethical conduct from getting Commonwealth government work for up to five years.
“The Commonwealth has no protections against this behaviour in the future,” she said.
“That’s why the Australian Greens introduced a bill to ban dodgy contractors, like PwC, from entering into government contracts and to deter unethical conduct.”
In August, Senators O’Neill and Pocock, along with Liberal senator Richard Colbeck (the three key senators who led inquiries into the scandal), failed to stop the Department of Finance from lifting a ban on PwC working for the government.
The decision to lift the ban was a formality because PwC sold off its public sector consulting arm, now renamed Scyne Advisory, in 2023 and agreed to a non-compete clause that will last until at least 2028.
A Finance spokesman said at the time: “PwC Australia has implemented and/or revised its policies and processes to meet the ethical standards of governance, culture, and accountability expected from government.”
PwC’s current CEO Kevin Burrowes said then that Finance’s move was a vindication of his ongoing, and onerous, reform program to improve the way the firm is governed and run.
“We are proud of the progress we’ve made across the past two years and look forward to continuing to embed these important changes,” Burrowes said.
Consultants’ nightmare at ANZ
Nuno Matos has been the chief executive of ANZ since May, and is making significant changes. Bryan Cook
Finally, some very bad news for financial services consultants across the country.
ANZ CEO Nuno Matos has said he will end or review the bank’s “engagements with consultants and other third parties, impacting around 1000 managed services contractors” as part of a massive cost-cutting plan at the big bank.
The move will send a particular shiver through the professionals at EY. That’s because, as banking and financial services reporter Angira Bharadwaj wrote last week, a group of EY consultants has been embedded in the department for more than a decade, operating as part of the team.
Latest stories
This professional life
Bain partner Lucy D’Arville helping at OzHarvest.
Charity OzHarvest will take its annual CEO CookOff national this October, with nine events planned across seven states. The event will feature chefs such as Neil Perry and Matt Moran, and senior executives such as Canva co-founder Cameron Adams and Bain partner Lucy D’Arville. Find out more here.
AI and the professions
How generative AI is shaping professional services.
Companies have a range of concerns about the increasing use of AI. Bethany Rae
A confession: when it comes to generative AI, I’m firmly in the pragmatists’ camp. Sure, it’s an amazing technology and I use it every day for individual tasks, but I’m cautious about claims that it can easily replace entire jobs (in the short term, at least).
With this in mind, I had a look through the corporate filings of some of the nation’s biggest listed companies to see what they were most worried about when it came to AI-related risk.
What I found included:
It’s a welcome dose of reality to the often over-baked promises about AI.
My favourite discovery was a comment by outgoing Wesfarmers chairman Michael Chaney: “No one, including the companies developing it, understands the ultimate outcome … predictions range from widespread unemployment or much worse effects on humanity on the pessimistic side, to a golden era of surging productivity and wealth by the optimists.”
Talk about refreshing honesty.
And here’s the real confession: I researched this piece with the help of generative AI, using the tool to do natural language searches of dozens of corporate filings, including documents that ran to hundreds of pages – one to more than 1200 in length.
I cross-checked the AI results against the original documents and then assessed it all for newsworthiness.
After all this was done, I used the detail from the original documents to write the article, and contacted any company that I was mentioned to ensure I was using the material in context.
The Australian Financial Review bans the use of AI for writing actual articles. My view is that the technology is a terrible writer in any case.
But this is a neat example of where AI can extend – not replace – what a journalist can do, by making a time-prohibitive task like reading thousands of pages of documents into a relatively quick one. Even if I do still have to double- and triple-check it all.
#REF!
A regular look at the words and phrases professionals love to use, and what they’re really saying.
Dog-fooding
Use: “We are dog-fooding this at Accenture and initial results our promising …” writes an Accenture blog on internal uses of Gen AI at the firm.
Meaning: The practice of using your own products or services internally before selling them externally.
What it probably means: We will enrage our own staff with this not-quite-ready product before enraging customers with the slightly more developed version.
The alternative: We will enrage our own staff with this not-quite-ready product before enraging customers with the slightly more developed version.
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Cheers,
Ed.
Connect: edmundtadros@afr.com.au, LinkedIn or X (Twitter).
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Edmund Tadros leads our coverage of the professional services sector. He is based in our Sydney newsroom. Email Edmund at edmundtadros@afr.com.au
