The chief operating officer at KPMG Australia has stepped down from her leadership position as the accounting firm faces mounting pressure over allegations it improperly used confidential client information to secure profitable audit contracts.
Eileen Hoggett relinquished her executive duties on Wednesday but will continue working as an audit partner while investigations proceed, according to an internal company message from interim CEO Stan Stavros that the firm provided to Reuters.
Hoggett assumed the chief operating officer position in 2023, but her departure from the role follows closely behind the recent exits of the company’s chief executive and audit department head, both of whom resigned over how the firm handled an internal probe into whistleblower accusations.
The accounting firm stated its investigation did not support the whistleblower’s claims, which were also brought to the attention of a senator from Australia’s ruling Labor party. In March, Senator Deborah O’Neill informed parliament that the whistleblower’s accusations involved confidential board documents from real estate firm Lendlease being utilized to help secure major audit contracts with Westpac and Dexus.
“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.
Hoggett did not immediately respond to a request for comment via LinkedIn.
These accusations have intensified examination of Australia’s professional services industry, which faced significant turmoil in 2023 when reports emerged that PwC had shared sensitive Australian government information with potential clients.
That controversy led to parliamentary investigations and resulted in the separation of the firm’s government consulting division, numerous staff departures, and stricter regulations for the industry.
In his message to employees on Wednesday, Stavros acknowledged the firm should have managed the whistleblower’s accusations more appropriately.
“I am 100% committed and will ensure we approach the issues in the right way,” he said.
“I want to be open that we should all expect the heightened public scrutiny to continue for some time.”
The Australian Securities and Investments Commission has launched a preliminary examination into the behavior of three KPMG registered company auditors.
A parliamentary hearing regarding the whistleblower allegations is also set for June 19.
