KPMG Australia has admitted to an ethical breach, confirming that sensitive information about telecommunications firm Optus was shared internally with a team bidding for an audit contract with its rival, Telstra. The admission, made by Chairman Martin Sheppard at a parliamentary hearing on Friday, substantiates whistleblower allegations that the firm had previously dismissed. This new revelation adds significant pressure on KPMG, which is already under fire for alleged misuse of confidential board papers from real estate company Lendlease.
Mr. Sheppard disclosed that unredacted information concerning Singapore Telecommunications-owned Optus “moved through an ethical divider” inappropriately. The emergence of this Optus-related evidence, identified through an investigation by law firm Allens, prompted the resignation of former KPMG Australia CEO Andrew Yates last month. Yates, who also appeared before the hearing, stated this evidence made him realise “there were things here that could have been found earlier.” Notably, the Telstra audit contract was ultimately awarded to Deloitte.
The hearing also scrutinised KPMG’s handling of the Lendlease allegations, where the company was only informed of the complaints in May 2025, a year after they first surfaced internally. Lendlease, which recently ended a nearly seven-decade relationship with KPMG, accused the firm of a “fundamental breach of trust.” Lawmakers, including Greens Senator Barbara Pocock and Labor Senator Deborah O’Neill, drew parallels with the 2023 PwC tax leaks scandal, questioning the efficacy of the partnership structure for large accounting firms and suggesting the need for stricter regulatory oversight by bodies like the Australian Securities and Investments Commission.
