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A tax agent who has been accused of making unauthorised access of a former client’s tax affairs has been granted a stay on his registration termination ahead of a further review.
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Tribunal grants stay on unauthorised portal access termination
24 August 2020
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10 minute read
Tax agent Sam Rizkallah, the principal and sole director of Le’Sam Accounting Pty Ltd, had seen his registration cancelled by the Tax Practitioners Board in December 2019 after it found that he was no longer a fit and proper person.
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The regulator acted on a complaint by a former client, who learnt that someone at Le’Sam Accounting had accessed her affairs on the ATO tax agents portal on at least two occasions in March 2019 even though she had not been a client since 2013.
Separately, the former client was also engaged in a civil dispute where Mr Rizkallah was named as a party in court proceedings.
In applying for a stay on the termination decision, Mr Rizkallah told the Administrative Appeals Tribunal he had known the former client and her ex-husband well over a number of years, and when the ex-husband asked if his ex-wife was still a client, Mr Rizkallah felt obliged to check.
Mr Rizkallah said that with around 900 clients, it was hard for him to keep track, and that checking the portal was a reasonable step if the former client had not mentioned anything and if no contact had been received from a new agent.
The tribunal heard that an employee of Le’Sam Accounting had accessed the former client’s details on the portal on two occasions in March 2019, although she said Mr Rizkallah had not instructed her to access the portal.
The employee told the AAT that she was new to the practice and inexperienced, and that Mr Rizkallah had merely asked her to confirm if the former client was still a client.
AAT deputy president Bernard McCabe said it was necessary to wait until the review hearing to decide on whether accessing the portal was a sensible or feasible means of checking the status of a former client.
“That evidence, if accepted at the hearing, might lend a more benign appearance to what was still unauthorised access,” Mr McCabe said.
In granting the stay, Mr McCabe accepted that Mr Rizkallah and his firm should be permitted to remain in practice pending the outcome of the review because of the inconvenience placed on his small-business clients in engaging a new tax agent in a time where many businesses were experiencing undue stress.
Mr McCabe also said that it was unlikely that Mr Rizkallah would repeat the specific mistake of accessing the portal improperly, but noted that his evidence remained troubling and would be tested at the final hearing in September.
“He says he had no way of knowing whether the former client — the ex-wife of a business associate — was still serviced by the firm,” Mr McCabe said.
“He was certainly aware she was a party to litigation that involved him. He says he thought checking the portal would be a reasonable way of resolving the issue notwithstanding the obvious conflict of interest.
“That he did not pause before instructing his employee to do something that was so obviously problematic raises serious questions about his judgement, and about his ability to behave appropriately even in the short term.”
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