Lendlease Criticises KPMG Over Claims of Misuse of Confidential Documents

Construction group Lendlease has slammed KPMG over claims it misused confidential client documents, as a parliamentary inquiry investigated the issue on Friday.

It comes after a KPMG whistleblower went public last year with allegations confidential Lendlease board papers had been stolen and used to aid a pitch for audit contracts from other firms, including Westpac and Dexus.

A response from KPMG raises some flags for Lendlease

A joint committee of parliament is looking into the matter and has heard from more than a dozen current and former KPMG partners, as well as clients, lawyers and regulators. John Gillam, chair of Lendlease, told the hearing KPMG response had thus far been “piecemeal” and “sporadic”.

There were thousands of KPMG people but Gillam alleged a tiny handful had committed a “serious abuse” of their access rights. He called it a fundamental breach of faith.

Lendlease CEO Tony Lombardo said KPMG had exercised “poor judgment” and added that the company would not work with KPMG on audit contracts in future. He called the situation very disappointing.

Former KPMG chief executive Andrew Yates and audit partner Julian McPherson resigned in May as a result of the scandal. Also let go was former chief operating officer Eileen Hoggett.

Accounting Body Condemns Alleged Conduct

It also looked at a phone call between KPMG and Chartered Accountants Australia and New Zealand immediately after the allegations came to light. Questioning CAANZ executives, Labour Senator Deborah O’Neill asked if the seriousness of the allegations had been communicated and if KPMG was asked to provide evidence.

CAANZ executive Vanessa Chapman said they had taken the “remarkable behaviour” of claims to Andrew Yates. Appearing before the hearing CAANZ chief executive Ainslie van Onselen told the hearing she was ‘very troubled’ by the alleged conduct which she said should never be an exploitation of client confidentiality.

The allegations are of the most serious nature, and principles of client confidentiality are among those taught from the start of an accountant’s career.

An internal investigation into the allegations did not substantiate the whistleblower’s claims. The findings in the internal review were backed up by an external investigation carried out by law firm Allens.

Source: news Au 

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