With ex-partners suing them, the parliament grilling them, the government firing them, AFP investigating them, and media lambasting them, the scandal-ridden PwC has their lawyers pick on an academic. Marcus Reubenstein reports.
Andy Schmulow, an associate professor from the University of Wollongong, has made a name for himself, calling out the wrongdoings of the Big Four accounting firms, particularly PwC.
It’s been rich pickings for Schmulow over the past couple of years, who’s posted on his LinkedIn account scathing and totally justified commentary on the ethically questionable practices of the big end of town.
In March of this year, it was all too much for PwC, which took great offence to a 463-word Schmulow LinkedIn post in which he advocated that PwC’s Australian boss Kevin Burrowes, who’d spent his first 16 years with the company in the London office, should be kicked out of Australia.
To boot, he offered an opinion that an AFR report describing Burrowes as having a “resting bulldog face” was accurate. As loose as defamation laws are, you can’t be sued for expressing an opinion.
The AFR’s Neil Chenoweth broke the tax scandal story in January 2023, and within four months, PwC’s Australian boss, Tom Seymour, was gone. After Kristin Stubbins stepped in as interim CEO, Kevin Burrowes was shipped in from the Singapore office to clean up the mess.
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Burrowes has been dubbed an enforcer and has had to front up to senate inquiries to answer ‘please explains’ as to his firm’s conduct. Following one such appearance, Chenoweth wrote: “Burrowes has a terminal case of resting bulldog face. On this occasion, a bulldog that has just tasted something exceptionally unpleasant.”
PwC directed its PR flacks to get on the phones to demand the deletion of those unkind words, the AFR refused. Eight months ago, Schmulow posted his tome on LinkedIn where he referred to Burrowes appearance clearly denoting “resting bulldog face” were the AFR’s words not his.
Social media policy breach
Under Australian law there is no recourse to have such posts deleted nor to commence any proceedings against the author. PwC’s lawyers, Allens stepped up with a plan of their own: complain to the University of Wollongong (UOW) about Schmulow’s post, claiming it breached the university’s social media policy.
It was a classic case of high-priced lawyers “trying it on” with a complaint couched in legalese alluding to Schmulow’s post being defamatory.
Whether they knew it or not – and one suspects the lawyers at Allens may well have known – Schmulow was informed about the complaint but had no right to see it because it was confidential.
Whilst not a criticism of UOW, it erred on the side of caution and when asked by Schmulow to show him the complaint he was eventually handed a heavily redacted version with more black ink than text. Not one to back down, Schmulow made an application under New South Wales’ freedom of information law, the Government Information (Public Access) Act, to see what PwC was saying about him.
That application led to the release of the PwC complaint last month, eight months after it was first lodged. There is an irony about this insofar as Schmulow’s criticism of PwC was in the public domain, yet its heavy-handed response was private and confidential. Presumably not for legal reasons but merely to satisfy the university, Schmulow amended references to two names, and his post remains online for all to see.
Allens wrote to UOW claiming, “The statements made in relation to Mr Burrowes and (a PwC partner) are factually incorrect and are likely to cause both professional harm and personal distress. Further, one of the statements made in relation to Mr Burrowes includes disparaging comments about Mr Burrowes’ appearance.”
Having finally seen the complaint, Schmulow says, “The gist from me is that the complaint refers to a post that makes assertions, all of which are verifiable. So, the complaint is a complaint without a cause, putting it in under confidentiality would only serve to conceal that.
What is the purpose? To my mind it is to intimidate me into silence.
It’s almost as if the lawyers have nothing to do.
On November 4, the Australian Federal Police (AFP) visited PwC’s Sydney office making polite inquiries as to whether it had breached secrecy laws by disclosing confidential Australian Taxation Office (ATO) information to corporate clients.
AFP officers spent several days at the PwC offices, with partners and staff having been reassured in a memo from Burrowes, “Despite the potential for distraction, let’s all encourage our teams to continue business as usual and remain focused on their important work with our clients and in the community.”
An endless lawyer fest
Last month, it was revealed that PwC fired up the lawyers lodging a counterclaim in the NSW Supreme Court against ex-partner Paul McNab, who was named by PwC as one of four partners associated with ATO leaks and is suing his former employer for unpaid entitlements.
Aside from McNab, seven other partners (now ex-partners), named and shamed by PwC for their part in the scandal, have either settled or commenced their own proceedings against the firm.
With the greatest of respect to sharks, the lawyers began circling once there was a drop of blood in the water about the tax scandal; now, it’s feeding a frenzy.
Why would PwC have one of its sharks slip into Wollongong Harbour to bite off the head of a lone academic? Did Schmulow breach confidentiality agreements, hand out sensitive government information to his colleagues and clients or give conflicted evidence to parliamentary committees? No, he quoted someone else who had called PwC’s boss an unkind name.
Unfortunately for PwC, Schmulow might not have the face of a bulldog, but he certainly has the fight of one. It’s a lesson for PwC and next time they brief the shysters at Allens someone is going to have to step up and say: “you’re going to need a bigger shark!”
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Marcus Reubenstein is an independent journalist with more than twenty-five years of media experience. He spent five years at Seven News in Sydney and seven years at SBS World News where he was a senior correspondent. As a print journalist he has contributed business stories to most of Australia’s major news outlets. Internationally he has worked on assignments for CNN, Eurosport and the Olympic Games Broadcasting Service. He is the founder and editor of Asian business new website, APAC Business Review..