KPMG admits partner used confidential Lendlease files in Westpac pitch
KPMG Australia has admitted a senior audit partner improperly accessed and displayed confidential board documents from longtime client Lendlease when the firm was pitching for a major Westpac contract.
The admission followed claims, aired in parliament by Labor senator Deborah O’Neill in March, that senior executives misused confidential client information and leveraged conflicted contacts to secure work.
KPMG is facing a major scandal after using confidential documentation from one of its clients to win a Westpac contract. Natalie Boog
In a letter submitted to and published by a parliamentary committee, Lendlease chief executive Tony Lombardo described KPMG’s actions as “not acceptable”. The company was “in discussions with KPMG as to the action to be taken,” he wrote.
KPMG told Lendlease that the documents had “low sensitivity” and gave the firm “zero competitive advantage”.
The allegations, by a former employee, triggered a Chartered Accountants Australia and New Zealand investigation and led to three partners disclosing issues at the firm.
The developments dramatically escalate the stakes for KPMG, which claimed it had been “unable to substantiate” the matters despite multiple internal and external investigations.
In an April 30 letter following O’Neill’s speech, Lombardo wrote that KPMG had admitted an “audit partner accessed … two documents from the Lendlease board papers” that the firm was not authorised to access.
“KPMG advised that these documents were put on a screen in the presence of the KPMG audit team then tendering for the Westpac audit ... KPMG acknowledged that the audit partner should have advised Lendlease that it had access to the audit tender folder in [the software system] and should not have viewed any of the documents in that folder,” he wrote.
Senate allegations
O’Neill, on behalf of the unnamed former employee, used parliamentary privilege in March to raise allegations that “confidential Lendlease board papers were taken and circulated internally within KPMG and used to pitch for major audit tenders, including Westpac and Dexus”.
“These documents were taken from Lendlease by the lead partners on the account, Eileen Hoggett and Paul Rogers, and were physically secured in Ms Hoggett’s locker,” O’Neill said.
“Michael Ullmer, then chair of Lendlease, and presiding over the Westpac audit selection process, was not informed that the tender process had been compromised by misuse of Lendlease confidential materials.”
KPMG has audited Lendlease for more than 60 years and won the Westpac audit contract in 2024 from rival auditing giant PwC.
O’Neill also used parliamentary privilege to claim KPMG personnel accessed a restricted Telstra technology environment during a live audit tender pitch, received “intelligence not available to competitors” to undermine rival EY during the Westpac tender, and intentionally left internal Dexus documents open on a laptop for audit staff to view.
She alleged KPMG partners and staff had used inside information to win audit contracts for Macquarie, failed to properly report artificial intelligence exam cheating allegations and then failed to act on the complaints.
The parliamentary joint committee on corporations and financial services met privately following O’Neill’s disclosures to hear evidence from the former employee. It is considering whether to hold special hearings, and published seven letters related to the allegations late on Thursday afternoon.
O’Neill said the letters were “vindication for the whistleblower who raised these concerns”.
“It should not take a speech in parliament, or a whistleblower’s disclosure, to prompt ethical action,” she said. “Stories of ‘open laptops’ and whispered conversations is behaviour that belongs in the pages of a low-rent spy thriller, not the offices of one of our big four accounting firms. The committee continues its consideration of this shocking matter.”
A KPMG spokeswoman called the matter “longstanding and complex”.
“Over the past two years we have identified multiple allegations from this whistleblower, which we have investigated where possible. Based on the evidence that was available, the allegations were not able to be substantiated,” she said.
“During the course of the investigations, however, two related conduct matters were identified. Before the allegations were raised in the parliament in March, we had commenced a process to consider these matters and any appropriate disciplinary action. We can confirm individuals involved were sanctioned and the subcommittee of the board endorsed those sanctions.”
She said the firm had escalated its “oversight and response accordingly”, and had contacted the Australian Securities and Investments Commission, Chartered Accountants and the Tax Practitioners Board over the allegations.
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