KPMG faces global probe after whistleblower scandal and CEO resignation

KPMG Australia’s crisis is no longer just about one whistleblower. It has become a governance test for the firm, with its board, its international network and its biggest clients now facing questions about who knew what, when they knew it and how badly the controls failed.

On 29 May 2026, KPMG Australia said its treatment of the whistleblower and the handling of the allegations fell short of expectations, and that its first internal investigation lacked the necessary rigour. Chairman Martin Sheppard accepted the immediate resignation of chief executive Andrew Yates and the resignation of National Managing Partner Audit and Assurance Julian McPherson, while Stan Stavros was named interim CEO. The firm also brought in Allens for a further external legal investigation that was still ongoing, after a board sub-committee led by the deputy chair and three independent directors identified shortcomings in how the whistleblower was managed, how the allegations were examined and how leadership responded.

The scandal widened on 2 June when ABC reported that chief operating officer Eileen Hoggett would step aside and return to a full-time audit role while investigations continued. According to that reporting, the whistleblower claims were first formally made in May 2024 and were later aired in parliament under privilege by Labor Senator Deborah O'Neill. The allegations include misuse of Lendlease board papers to pitch for and win audits of Westpac and Dexus. KPMG has publicly named Lendlease as the only client so far to confirm it was affected, while the firm has apologised unreservedly to the whistleblower and to clients whose information was not handled properly.

The pressure turned regulatory on 5 June, when ASIC told Senate estimates it had formally commenced an investigation into KPMG and identified two registered company auditors under formal investigation, Eileen Hoggett and Paul Rogers. ASIC chair Sarah Court said there were currently just two registered company auditors subject to formal investigation, although preliminary inquiries into others were still under way. ASIC also said it had eight current contracts with KPMG, a reminder that the fallout could affect far more than the audit team at the centre of the claims.

The broader damage is spreading through Canberra and client boardrooms. A parliamentary hearing on ethics and professional accountability for KPMG is scheduled for 19 June, with witnesses expected to include Martin Sheppard, Stan Stavros, Scott Guse, Andrew Yates, Julian McPherson, Eileen Hoggett, Paul Rogers, Anne Collins and Gary Wingrove. The Reserve Bank of Australia has already said it will re-tender its whistleblower hotline contract after distancing itself from KPMG, even as committee papers show correspondence from the ACCC, CPA Australia, APRA, the Institute of Public Accountants, Lendlease, Westpac and Chartered Accountants Australia and New Zealand. For KPMG staff, the message is blunt: audit credibility, leadership accountability and the firm’s internal reporting culture are now under the same microscope.