Deloitte Just Admitted to Misusing Government Information à la PwC Tax Scandal
July 15, 2023
So the firms are up against the Australian Senate this week, answering uncomfortable questions about their inner workings all because one PwC partner couldn’t keep his mouth shut and blabbed confidential government tax intel back to the firm so PwC could make some money off of it. While that situation continues to destroy PwC’s reputation like a wrecking ball made out of solid gold dicks, it has also called into question the consulting industry’s grip on governments hence why the other three are getting grilled to find out if they too are consulting with one hand and monetizing what they learn with the other.
Deloitte just admitted that yes, yes they did. But they did not elaborate.
The Guardian:
Another big four consultancy firm has confirmed it misused government information last year, widening a scandal that has engulfed global giant PwC.
Deloitte disclosed the breach as part of an ongoing Senate inquiry, but has so far refused to provide any more details about the incident due to client confidentiality.
The firm has also detailed how it was dumped by the Home Affairs department after it failed to disclose a conflict of interest. A similar breach was also identified while working with the Australian National Audit Office (ANAO).
According to Deloitte’s admission, the firm misused confidential or proprietary information on 18 occasions two years ago and nine in the last fiscal year so hey, they’re getting better. They did not provide details, it’s safe to assume the Australian Senate will extract it from them, Guantanamo-style if they have to.
The firm gave a cagey answer about how conflicts will be handled, an answer that is unlikely to satisfy governing bodies. “Any matters in relation to the misuse of confidential government information would be investigated in line with our normal processes,” said Deloitte’s response to questions from the committee. “Consequences would vary depending on the findings of our internal investigations and, as with any misconduct, these consequences include disciplinary actions in accordance with our policies, which apply to both partners and employees.”
One conflict Deloitte seemed up to talking about was its contract with the ANAO to audit a government agency’s ESG data at the same time Deloitte was engaged by that agency to audit its financials. “It was identified in August 2022 that Deloitte had not sought pre-approval from the ANAO to provide the service, as required under their independence and conflicts management policies,” Deloitte said.
Deloitte also mentioned an earlier conflict of interest issue involving the Australian Department of Home Affairs (not what it sounds like).
Deloitte also referred to the Home Affairs department terminating a contract after an investigation found “an organisational conflict of interest that was not disclosed to the department when it was engaged”.
According to an ANAO report published last month, Deloitte was advising the department on IT procurement. At the same time, a Deloitte partner was seconded to a company bidding for work with the department.
On March 10, 2021, a tenderer emailed the department through the RFT complaints process raising concerns about the appointment of Deloitte as commercial adviser. They stated that a senior partner from Deloitte was seconded [loaned out to] to the company to assist it with preparation of its tender bid. The tenderer sought confirmation from the department that ‘adequate conflict checks were carried out by the department’ and requested ‘urgent clarification on the avenue available to [it] to raise [its] concerns formally and to understand potential remediation’.
Deloitte’s engagement as the commercial adviser to Home Affairs was suspended in March 2021 and terminated on May 18, 2021. ANAO report on that. Please God don’t make me type ‘ANAO’ again because I’m positive I’ll miss the unfortunate typo.
Other than that though Deloitte said it was “not aware of any other significant conflict of interest matters relating to government work”. Whew, we can all go home now.
Deloitte was not as forthcoming about its partnership agreement, claiming it “contains sensitive information that could potentially present a commercial advantage to our competitors and prejudice our partnership.” PwC — remember, this is the firm that took confidential government information about a new tax avoidance law and tried to leverage it to charge clients for advice on avoiding said tax avoidance law — gave theirs to the committee previously with the caveat that the information stay private among the committee. The irony.
We’ll definitely keep you posted.
[Going concern]
