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Australia's corporate regulators have launched an investigation into three KPMG Australia partners linked to mishandled internal whistleblower allegations regarding the inappropriate sharing of confidential client data to secure audit contracts.
The probe comes as some blue-chip clients and government agencies say they are re-examining their association with the accounting firm, three years after rival PwC Australia was rocked by a scandal that involved sharing confidential government information with prospective clients.
The Australian Securities and Investments Commission (ASIC) said it kicked off a preliminary probe into KPMG in April and moved to a formal investigation after the firm's CEO and audit chief resigned last week.
Australia's Department of Finance said it was taking the allegations "extremely seriously", and the firm could lose its spot from pre-approved agencies or would agree not to bid for any federal government work for a period of time.
PwC agreed not to bid for new government contracts from April 2024 to July 2025 following its scandal.
The firm sold its government advisory business, which had accounted for a fifth of its revenue, for A$1 in August 2024. The renamed Scyne Advisory was then allowed to bid for new government contracts.
KMPG allegations
In March, Deborah O'Neill, a senator from Australia's ruling Labor Party, shared with parliament a whistleblower's allegations of misconduct at KPMG.
KPMG had conducted an internal investigation into the claims but failed to highlight any misconduct.
Court said KPMG partners Paul Rogers and Eileen Hoggett were two of the three auditors the regulator was investigating. It did not name the third partner under investigation.
