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KPMG Australia's chief executive Andrew Yates and its head of audit, Julian McPherson, resigned on Friday, June 1, 2026, following revelations that an audit partner accessed confidential client documents from Lendlease and that the firm mishandled a whistleblower complaint about the incident.
The scandal has prompted reviews of KPMG's government contracts in New South Wales and Victoria, and the Reserve Bank of Australia has decided to re-tender a whistleblower hotline service previously provided by KPMG.
Leadership Changes and Internal Investigation
Resignations
- Andrew Yates, chief executive of KPMG Australia, resigned effective immediately.
- Julian McPherson, national managing partner of audit and assurance, stepped down and will formally resign after transitioning his client responsibilities.
- Eileen Hoggett, chief operating officer, stepped aside from her role pending investigations.
Interim Appointments
- Stan Stavros has been appointed interim CEO.
- John Sams, CFO, will assume the COO role.
- Gayle Dickerson replaces Stavros as national managing partner of deal advisory and infrastructure.
- Scott Guse replaces McPherson as head of audit.
Investigation
- An initial internal investigation by KPMG and a subsequent external legal review did not substantiate the whistleblower's allegations.
- KPMG has acknowledged that these investigations were not conducted with the "necessary rigour required."
- Law firm Allens has been engaged to conduct a new investigation, which is ongoing.
- An external review by Principia Advisory is reviewing KPMG's policies and support for whistleblowers.
- KPMG chairman Martin Sheppard stated the firm will publish the findings of the Principia review.
The Whistleblower Allegations
Documentation Access
- A whistleblower, who first made a complaint in 2024 containing dozens of allegations, reported that KPMG partners accessed confidential Lendlease board papers.
- The whistleblower alleged this information was used to pitch for and win audit work at Westpac, Dexus, and Macquarie Group. The Macquarie contract is valued at approximately $75 million per year.
- KPMG initially told Lendlease in May 2025 that there was "no issue."
- KPMG later acknowledged that an audit partner had accessed the documents, which KPMG described as of "low sensitivity" and providing "zero competitive advantage."
Firm's Admission
- KPMG confirmed in a statement that its treatment of the whistleblower complaint and its initial investigation "fell short of the firm’s expectations, those of the whistleblower and the broader community."
- The firm has apologized unconditionally to the whistleblower, clients, and employees.
Client and Regulatory Responses
Lendlease
- Lendlease confirmed that an audit partner accessed its board papers and displayed them to the KPMG audit team.
- Lendlease CEO Tony Lombardo sent a letter to KPMG stating the actions were "not acceptable."
- Lendlease announced it will review its audit contract with KPMG and put its external auditing contract out to tender after the completion of FY26 reporting.
Other Clients
- SingTel Optus was informed by KPMG that its data was accessed in an attempt to win audit work for Telstra.
- Macquarie Group was also named in the parliamentary proceedings.
Regulatory Actions
- The Australian Securities and Investments Commission (ASIC) is conducting a preliminary investigation into three registered company auditors involved in the case.
- ASIC chair Joe Longo described the circumstances as "clearly unacceptable," noting a breach of auditor-client protocol.
Government Contract Reviews
Federal Government
- Federal Finance Minister Katy Gallagher expressed concern and stated the government expects suppliers to meet high ethical standards.
- According to the Australian Greens, the federal government holds 27.4 million Australian dollars in active audit contracts with KPMG across departments including CSIRO and the Bureau of Meteorology.
New South Wales Government
- NSW Treasury Secretary Michael Coutts-Trotter requested KPMG disclose its plan to address ethical lapses, provide a list of active contracts with NSW agencies, and confirm that personnel under investigation are not working on NSW government engagements.
- NSW currently has contracts with KPMG entities worth over $70 million, mostly expiring between July 2024 and October 2029.
- NSW Finance Minister Courtney Houssos stated the concerns are being taken seriously.
Victorian Government
- Victoria will review all contracts with KPMG.
- KPMG was the Victorian government's largest consultancy vendor from 2017-18 to 2022-23, receiving $150 million in work.
Reserve Bank of Australia
- RBA Governor Michele Bullock confirmed the bank used KPMG's whistleblower hotline service.
- The RBA will not reappoint KPMG for this service and is re-tendering the contract.
- The RBA also has a contract with KPMG for foreign employee recruitment services.
- Bullock noted the RBA does not have a direct relationship with KPMG for audit services, as those are engaged by the Australian National Audit Office (ANAO).
Political Context
- The allegations were revealed under parliamentary privilege by Labor Senator Deborah O'Neill on March 24.
- Senator O'Neill chairs the parliamentary joint committee that also investigated the PwC tax leaks saga.
- Greens Senator Barbara Pocock called on the government to ban KPMG from all government contracts.