CANBERRA, Sept. 4 — Australia’s corporate regulator closed a whistleblower complaint against KPMG within days of receiving it, despite warnings that the alleged misconduct posed an “urgent” threat to market integrity, according to correspondence aired in federal parliament. The whistleblower, a KPMG Australia insider, first approached the Australian Securities and Investments Commission (ASIC) in September last year with allegations of systemic problems at the accounting firm.
These included claims that a former partner treated female staff and clients inappropriately, and that confidential board papers from the property group Lendlease were used to support KPMG’s bids for major audit work with Westpac and Dexus. ASIC closed the matter days later, the whistleblower said, without offering assurances of protection for a more detailed disclosure.
The regulator only announced it would investigate the alleged audit leaks after Labor senator Deborah O’Neill raised the allegations in parliament under parliamentary privilege in March this year.
Internal complaints dismissed
The whistleblower said they had first tried to report the issues internally at KPMG and to KPMG International, but that the firm dismissed the allegations as a private employment matter and “refused to acknowledge my whistleblower status or protections.” The person approached ASIC “under the continuing threat of retaliatory legal action from KPMG,” writing: “Despite this, the truth must come out…
Delay in addressing them risks allowing systemic misconduct to continue unchecked, directly undermining market integrity and investor confidence.” The complaint also took aim at the firm’s internal review processes, alleging that “reviews commissioned and controlled by KPMG — including those conducted under legal privilege — cannot credibly be presented as independent.” In early 2025, current and former KPMG partners were summoned before a federal inquiry examining why the firm allegedly shared client information and ignored the whistleblower’s allegations.
A separate KPMG whistleblower has been sharply critical of ASIC’s conduct, saying the regulator had to be “dragged kicking and screaming to take action.” ASIC chair Sarah Court has acknowledged that whistleblowers are not properly protected in Australia, and the government is currently reviewing whistleblower protection laws. The regulator told ABC News: “ASIC takes all whistleblower reports and allegations of misconduct seriously.” For its part, KPMG said it was looking to strengthen its own whistleblower policy.
A spokeswoman said: “Now, more than ever, we are focused on creating an environment where people feel safe to speak up.” The episode raises awkward questions for ASIC, which is meant to be the first line of defence for those who bring corporate wrongdoing to light.
For all the noise about KPMG’s conduct, the salient point may be that a regulator entrusted with policing the market appears to have needed a parliamentary intervention before it acted — and that the person who blew the whistle remains, by their own account, exposed to legal retaliation.
What to watch next is whether the government’s review of whistleblower protections produces anything more than words, and whether ASIC’s belated investigation into the audit leaks yields findings that satisfy the critics who say the firm’s culture has gone unexamined for too long.
