The corporate watchdog has revealed its probe into the whistleblower scandal at KPMG now includes companies controlled by the accounting and consulting giant, and potentially these companies’ directors.

The directors, who were on the boards of KPMG’s corporate entities since the initial complaint was made in 2024, include former NSW premier Mike Baird and senior KPMG executives who have resigned over the growing scandal.

The extent of the Australian Securities and Investments Commission’s (ASIC) investigations into KPMG were unclear until now, as it does not regulate partnerships, a business structure used by auditors.

Confirmation that ASIC is investigating companies controlled by KPMG – as well as some of its auditors – means the watchdog’s investigation will not be limited by the fact it does not regulate partnerships.

KPMG has been under siege after admitting that some of its staff accessed confidential information from corporate clients to win business – a serious breach of trust in the world of auditing that is essential to the integrity of financial markets.

In response to questions on notice from Greens senator Barbara Pocock, ASIC confirmed it is using its jurisdiction over corporate entities linked to the KPMG partnership, and their boards, for potential wrongdoing in relation to the whistleblower scandal.

It specifically mentioned an investigation into potential breaches of corporate law relating to the protection of whistleblowers without mentioning which KPMG corporate entities and boards are part of the probe.

“ASIC has commenced an investigation in relation to suspected contraventions of the protections of Part 9.4AAA of the Corporations Act,” it said in response to Pocock’s queries.

ASIC’s probe could include other issues, as well as possible breaches of whistleblower protections.

Separately, ASIC said it is currently assessing 24 KPMG entities “to determine whether it may be relevant to KPMG’s current investigations” and identified KPMG Australia Pty Ltd and KPMG Australia Services Pty Ltd as entities that may be “relevant” to its investigation. It is not known whether ASIC is investigating former or current directors.

“We will consider the conduct of directors of those entities where the circumstances of the relevant entity indicate that such consideration is required. At this stage, that assessment is ongoing,” ASIC said.

KPMG Australia Pty Ltd’s board has had 15 directors since the whistleblower made complaints in 2024, including executives who have been forced out by the scandal, including former boss Andrew Yates, former chairman Martin Sheppard and partner Kim Lawry.

Baird and fellow former independent director Patty Akopiantz are also listed as directors, according to documents lodged with ASIC.

This is separate to the partnership board where both Baird and Akopiantz were directors, alongside Jane Hemstritch who is expected to leave this year.

Deputy chair Carmel Mortell – who accused Lawry and sacked partner Eileen Hoggett of lying to the firm at Friday’s public hearing into the scandal – is also a director of KPMG Australia Pty Ltd.

Lawry is facing further sanctions after current investigations uncovered a screenshot of confidential Lendlease board papers on Lawry’s phone.

Lawry told the hearing on Friday that she accepted accountability for the screenshot, but rejected assertions from O’Neill that this was a breach of her professional standards.

“I wasn’t aware at the time the information was confidential,” Lawry said.

At a previous hearing in June, Baird was critical of KPMG’s response to the whistleblower complaints.

Before he resigned, Baird had been assured by management that there was no substance to claims from a whistleblower that senior KPMG staff had shared data from blue-chip clients including construction giant Lendlease in order to win business.

“Now, were we too trusting in that position? Clearly, we were,” Baird said.

Baird also told an inquiry that he had pushed for an independent investigation into the whistleblower’s claims before he resigned.

At the previous hearing into the whistleblower scandal in June, ASIC chair Sarah Court pointed to regulatory gaps that prevent the regulator from looking into the partnerships that employ auditors who work for Australia’s biggest corporations.

“Our jurisdiction in relation to audit firms as opposed to individual auditors, as we have discussed on several occasions, is extremely limited. We can only investigate individual registered company auditors within the partnership, and only then in relation to their conduct of an audit.”

At Friday’s hearing, chairman Michael Ebeid defended his million-dollar salary and ascension to the chairman’s role for which no alternative candidates had been selected by KPMG partners. Ebeid had previously rubbished the whistleblower claims after O’Neill made them public in March this year.

“There’s a lot that I should have done differently, and I take responsibility for that,” he told the hearing.

KPMG’s deputy general counsel James McClelland told Friday’s hearing that unnamed KPMG partners had lied to him while he carried out an internal investigation of the whistleblower’s allegations.

He said answers were “misleading, if not directly deceptive to the questions that I asked” and a teary McClelland lamented the limitations put on him by former CEO Yates.

But Ebeid was also critical of McClelland’s role in the process, which included briefing law firm Allens.

“I was particularly concerned about the level of aggression in the letters being sent to the whistleblower that were being written by Mr McClelland, and I was uncomfortable with that, as were my colleagues as well,” he told the committee.

“I think when you were involved in one investigation and then you’re involved in another, you almost – I think it’s human nature – you want the same outcome. And I was worried about that.”

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