Former EY partner in tax case ‘took $700k in unauthorised payments’
EY Australia has outed itself as the big four accounting firm that employed a former partner being sued for allegedly promoting tax exploitation schemes and revealed he took more than $700,000 in unauthorised payments related to the allegations.
The news – first revealed by The Australian Financial Review – that the Commissioner of Taxationwas suing an ex-partner in the Federal Court piled further pressure on the firms while they are under intense scrutiny following the PwC tax leaks scandal.
A variation of suppression orders means EY can be named as the firm allegedly involved in promoting tax exploitation schemes. Will Willitts
The Tax Office alleges the former EY partner promoted three so-called Tax Loss Access Schemes to seven clients between November 2016 and April 2021.
On Wednesday, EY revealed it terminated the ex-partner in August 2022 after he disclosed he received more than $700,000 in unauthorised payments connected with the client transactions in the tax exploitation case.
“These unauthorised financial benefits, received in relation to the transactions described in the proceedings, gave EY cause for concerns about the former partner’s transactions, advice and conduct,” the firm said in a statement.
“EY has cooperated fully with regulators throughout this process and will continue to do so. Through these events EY has identified opportunities to introduce additional controls that strengthen the monitoring of compliance with the relevant policies and procedures.”
Last week, the Financial Review revealed the ex-partner will claim colleagues at EY helped draft and review documents for the schemes the tax commissioner is alleging he promoted.
Temporary suppression orders prevented the naming of EY until now
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