CONSTANT, Ms Simone, Commissioner, Australian Securities and Investments Commission COURT, Ms Sarah, Deputy Chair, Australian Securities and Investments Commission GREGSON, Mr Scott, Chief Executive Officer, Australian Securities and Investments Commission KIRKLAND, Mr Alan, Commissioner, Australian Securities and Investments Commission LONGO, Mr Joseph, Chair, Australian Securities and Investments Commission O'ROURKE, Ms Kate, Commissioner, Australian Securities and Investments Commission SAVUNDRA, Mr Chris, Executive Director, Enforcement and Compliance, Australian Securities and Investments Commission Committee met at 09:03 CHAIR ( Senator O'Neill ): I declare open this hearing of the Parliamentary Joint Committee on Corporations and Financial Services into the oversight of ASIC, the takeovers panel and the Corporations Legislation. I begin today by acknowledging the Ngunnawal and Ngambri people, the traditional custodians of the land on which we meet, and I pay my respects to their elders, past and present. I extend that respect to Aboriginal and Torres Strait Islander peoples here today. The committee will conduct today's hearing in person and via videoconference. These are public proceedings being streamed live via the parliament's website, and a Hansard transcript is being made. I remind all witnesses that in giving evidence to the committee they are protected by parliamentary privilege. It's unlawful for anyone to threaten or disadvantage a witness on account of evidence given to a committee, and such action may be treated by the Senate as a contempt. It is also a contempt to give false or misleading evidence. Witnesses also have a right to request to be heard in camera. If a witness objects to answering a question, they should state the ground upon which the objection is made, and the committee will determine whether it will insist on an answer having regard to the ground which is claimed. If the committee determines to insist on an answer, a witness may request that the answer be given in camera. I understand that information on parliamentary privilege and the protection of witnesses giving evidence to Senate committees has been provided to all witnesses. Senator Buchholz, this is your first oversighting of ASIC. Welcome. Mr BUCHHOLZ: Thank you. I was a former chair of the Economics Committee, and we used to have a line of sight to ASIC, APRA, ACCC and ASX. I am looking forward to engaging here. CHAIR: Thank you for joining us. I also want to note for the public record that this is the last occasion on which this committee will oversight ASIC under its current leadership, Mr Joseph Longo, its current chair. Mr Longo has served with distinction and great care at a very high level in our country, being very responsive to the requests of this committee. Mr Longo, I have to say that, in the time that you have been chairing ASIC, the briefings that we've received and the level of communication have allowed us to do a better job, when you have appeared before us, in putting perspectives to you from the Australian public. Mr Longo, on behalf of the committee and others, I sincerely thank you for your service for the public good. Senator Scarr. Senator SCARR: Chair, perhaps I could join with you and make some comments on behalf of committee members here today. As one of the longest serving members of this committee—albeit I had a very small interregnum—I just want to associate myself with your remarks. Chair Longo, you've done an outstanding job. At the outset, I commented on the distinguished professional career you had, which formed the foundation for your service for ASIC and the Australian people. In terms of Commonwealth agencies, I think this must be one of the most complicated leadership jobs there is in this country. I think you've achieved a wonderful balance between the competing priorities. You've always been deeply respectful of the questions asked by the committee. More than anything, from my perspective, you've shown a passion for protecting the Australian people from egregious corporate behaviour, and I have really admired that. I think you've made a profound difference, so thank you very much. CHAIR: Hear, hear! Mr Longo, I now invite you to make a slightly longer than usual closing statement. Over to you. Mr Longo : May I say that this is a wonderful way to start the day. CHAIR: It's all downhill from here! Mr Longo : We'll do what we can to make sure that it's a very productive day, as it usually is. Good morning, everyone. Yes, after five years of being ASIC's chair, this is my last appearance before this committee. Chair, I do appreciate the indulgence that's been given to me to speak for a couple of extra minutes, as you noted at the very beginning, but I do reassure the committee that it won't be that much longer than usual. I'm joined by Deputy Chair and incoming Chair Sarah Court; Commissioners Alan Kirkland, Kate O'Rourke and Simone Constant, who are around me; Scott Gregson, who is at the end of the table; and, of course, Chris Savundra, who is our Executive Director, Enforcement Compliance. Today, I want to offer some observations about the organisation I've led since 2021 and the opportunities and challenges I see on the horizon. Before I begin, I would like to acknowledge the essential role that members of this committee perform within the parliamentary system. ASIC is the only financial regulator in the country with its own statutory oversight committee, in recognition of the deep complexity of the legislation that we administer and its importance to the economy. This committee has been sitting since January 1991, when the Australian Securities Commission, ASC, as it was then known, now ASIC, was created. Since 2002 alone, this committee has undertaken an extraordinary 98 inquiries and reports, approximately four a year, examining a range of important issues to Australians. By appearing before you today, I conclude my term almost where it began, although I think we can agree that much has changed since then. In my first remarks to this committee, I said that I believed that ASIC's strength and effectiveness as an institution can and will be enhanced and, if I may say so, indeed it has been. Today, ASIC is a modern, confident and ambitious regulator. It is modern because we prioritise data and technology to keep pace with the fast-changing financial system; confident because we are prepared to act decisively, publicly and proactively to address misconduct and emerging risks; and ambitious because we are willing to raise the bar, for ourselves and the financial systems that Australians rely on, by testing the law and driving systemic change through every available channel. You can see evidence of that ambition in the breadth and depth of the matters that we pursue, whether it is by securing $250 million in combined civil penalties from ANZ for widespread misconduct and systemic risk failures, pursuing AustralianSuper and Cbus for devastating member services failures, obtaining a $26 million fine just this week against Westpac for hardship failures, or holding the ASX to account for serious governance and operational failures, which is a topic I know this committee has looked at continuously over the last five years. Ambition is why ASIC is in court nearly every day of the week, from the Magistrates Courts all the way to the High Court. Indeed, as we speak, we are awaiting a decision from the High Court on a digital asset matter. Each year, during the past five years, we have more than doubled the number of formal investigations and quadrupled the value of the penalties obtained. This financial year, we have secured already approximately $484 million in penalties. I pause here. That's nearly half a billion dollars, and that is in this financial year alone and does not include those still subject to court approval. That is an extraordinary change from the situation five or six years ago, although I have to say that the change in the law in 2019-20 helped. ASIC today is undoubtedly stronger and more effective than it was five years ago. I also want to acknowledge here the important role of the Financial Regulatory Assessment Authority, FRAA, in assessing and reporting on the effectiveness and capability of ASIC. In FRAA's first review of ASIC, in 2022, it found that ASIC was a generally effective and capable regulator. I turn now to the challenges and opportunities ahead for ASIC. Firstly, we need to maintain trust in our institutions, such as ASIC. We can't have open, robust and competitive markets without confidence and trust in the integrity and resilience of our financial system. ASIC plays a critical role in delivering this outcome. Confidence and trust depend on people seeing ASIC boldly enforce the rules and follow through on our commitments. One of the significant decisions that Sarah Court and I took early in our terms was to institute a yearly practice of announcing ASIC's enforcement priorities. These make clear the choices that we make in prioritising cases and deploying our limited resources, and they hold us accountable for doing what we said we would do. Being an effective regulator means making difficult choices, and that includes choices about what we investigate and what we litigate. ASIC does not have unlimited resources, and litigation is costly, particularly when taking on the big end of town, when seeking to hold multiple officeholders to account or addressing industrial-scale misconduct, as ASIC has done over the past few years. This brings me to a second challenge: the sustainability of the Enforcement Special Account, ESA. ASIC's strong enforcement outcomes, increasing complexity of matters and government savings measures have significantly eroded the cash balance of this special account, which is designed to provide capacity for significant matters. By 30 June this year, the ESA is forecast to fall to the minimum level needed to manage the risk of adverse court orders. Absent replenishment, this will impede ASIC's ability to maintain its current enforcement program. We are engaging with the Treasury and government about this. Of course, ASIC doesn't operate in a vacuum. Effective enforcement relies on the broader system around us. We strongly support the Federal Court's expanded criminal jurisdiction, which allows ASIC to bring civil and criminal matters before a single specialist court. But capability must be matched with capacity. Frankly, we cannot expect ASIC to run an increasing number of more timely criminal cases if the Commonwealth Director of Public Prosecution's resource envelope to assess and determine ASIC's referrals to briefs of evidence remains static. This is particularly so as the demands on the DPP grow from other law enforcement agencies around the Commonwealth. The third challenge ahead is to continue to get the balance right between active enforcement and regulation. With the remit spanning millions of entities and individuals, ASIC faces a stark reality. We simply cannot litigate our way out of every problem. Litigation, by its very nature, is a rear-view mirror. It cannot deal with many of the forward-looking challenges that we face as a nation: improving our national productivity; encouraging innovation; increasing financial literacy; and maximising the opportunities presented by technologies, such as AI and supercomputing. This requires ASIC's regulatory strategy to be informed by imagination, ambition and collaboration among all stakeholders. This approach is reflected in ASIC's implementation of several major reforms since 2021, including climate disclosure; digital assets, particularly crypto; the banking code; developing a roadmap for our public and private markets; and improvements in how we deal with scams. It's why ASIC is internationally active and engaged and not just with other regulators but with the global players who are doing business in Australia and contributing to Australia's reputation for being an attractive place to invest. It's also why we are encouraging financial innovation, from being a key part of the Reserve Bank's Project Acacia to exploring ways in which we can better support startups with pathways from regulatory sandbox to licensing. Additionally, it's why we've initiated a national discussion about regulatory complexity and, through our ASIC Simplification Consultative Group, acted to address it. As a system, we've long struggled to deliver timely and meaningful law reform in corporate law and financial services. At ASIC, I am continually hearing that the regulatory burden and compliance costs are simply too high and climbing. It's high time that we did something about it. As part of the national conversation about productivity, we need to consider how the public and private sector can better work together to reduce the compliance burden more effectively. In my view, ASIC's public and private markets work is a good case study of how difficult and complex problems can be addressed through a structured and transparent collaboration between the public and private sectors. Since the Corporations and Markets Advisory Committee, CAMAC, was defunded in 2014 and subsequently abolished, a public-private mechanism to consider and recommend legislative reform has not existed in relation to corporations and financial services law. I think it's fair to say that the market and the general community miss it. In my view, a modern, updated version of CAMAC would be most welcome, and perhaps a broader, more ambitious version of ASIC's Simplification Consultative Group that includes representatives from business, consumer groups, Treasury and academia could form a template for such an initiative. The fourth and perhaps most urgent challenge is the need to stay ahead of a technological change. Notably, in its 2022 review, the Financial Regulatory Assessment Authority highlighted the urgent need for further investment in technology and data to enable ASIC to remain 'effective, credible and relevant' into the future. This is a call I and the commissioners have certainly heeded, and I've certainly heeded it as chair, because the pace of change is accelerating. The period between discovery and disruption is compressing. If we do not remain institutionally engaged and curious about emerging technologies and innovation, it will be an existential risk to ASIC's effectiveness and credibility as a regulator. We already know that regulators such as AI will directly challenge our regulatory capability, and we must rise to meet that challenge. That means that we need at least three things: information when it matters; the powers to audit and test where and when it matters; and the ability to give the market clear signals about our posture and why it matters. We, ourselves, must also embrace these technologies and use them for our own purposes; in other words, the forces reshaping our markets must become part of how we regulate them in future. We are fast approaching a future where fit-for-purpose regulation is data led, responds in real time and anticipates problems before they escalate, backed of course by strategic and timely litigation. If we miss the boat here, we risk becoming irrelevant. This year, ASIC is celebrating 35 years of operation. However, we cannot regulate the future with tools of the past. That is why we are piloting access to advanced supercomputing infrastructure, in partnership with the Human Technology Institute of the University of Technology Sydney and the Pawsey Supercomputing Research Centre in Perth, in order to test how predictive, probabilistic methods can support earlier detection of conduct harms and more targeted supervision. I welcome the government's recent investments in ASIC to strengthen some of our digital capabilities. This includes a $97.3 million investment to complete RegistryConnect tranche 2, delivering new services, linking director IDs, and modernising and securing our registry systems. The fifth and final challenge is supporting consumers and investors to make confident and informed financial choices. We welcome the government's $10.3 million investment to strengthen oversight of the managed investment schemes sector, enhancing ASIC's digital capability and access to non-ASIC government data, as well as the investment of an additional $6.2 million over four years, with an ongoing $1.4 million to improve governance arrangements and further strengthen supervision of the sector. This will better position ASIC to respond to existing and emerging risks, including those highlighted by the Shield and First Guardian matters. However, I want to be frank that this is not a silver bullet. Investors and consumers will continue to sustain losses from time to time. The possibility of losses lies at the heart of investment risk-taking, and our system of regulation encourages risk-taking. ASIC cannot always be in a position to pick up the pieces, and nor is it our role. Prevention is always better than cure. We must continue to invest in initiatives that will empower consumers and investors to make good decisions in their own interests. Investing in financial literacy and in ASIC Moneysmart is fundamental to this. I will end with a thank you to all of ASIC's talented and dedicated people, who are working very hard every day to ensure that Australians benefit from a fair, strong and effective financial system. I thank you, Chair, for giving me a little more extra time, and we now welcome the committee's questions and engagement. CHAIR: Thank you very much indeed, Mr Longo. I am sure that your statement will be much reported; there's a lot in there. I note that the ASIC enforcement priorities for 2026 were extensive, and you have provided quite a detailed response to many of those in the submission, which we will be interrogating today. Amongst those matters that you indicated will be an enforcement priority for 2026 was not only the strengthening of investigation and prosecution of insider trading conduct but also auditor misconduct. That brings me to some contemporaneous concerns about the quality of audit. This is not a new area. We've ploughed this field a few times, and I have to say that I don't like the look of what's growing in the field, Mr Longo, and I'm sure that you don't either. So perhaps I can commence with a series of questions and then share the call with colleagues. I want to take you through a hypothetical situation because a lot of matters are live. Perhaps I can commence with the fact that, as prescribed under the corporations legislation, companies are required to provide full access to all sensitive documents when an auditor arrives; is that correct? Mr Longo : We have anticipated this interest, so, if it is okay with you, I will ask Commissioner O'Rourke, who has done an immense amount of work in this area, to answer these questions. If it's okay with you, we will start with that question and take it from there. CHAIR: Thank you. I have a number of questions, and we don't want to go too long, but I definitely want to get this on the record for people who don't follow this but need financial literacy to understand what's going on and get the lay of the land. If auditors Partnership ABCD, a hypothetical partnership, were to go to an external firm, which we'll call Tate Transport, it would have prescribed capacities, one being an entitlement to gain full access to all sensitive documents; is that correct? Ms O'Rourke : We have had opportunities previously to discuss auditors and their role with respect to companies, so I think I would respond by saying that auditors have a particular role in relation to the verification and assurance of financial information. As for their access requirements, there may be some boundaries there and, if there is sensitive or confidential information entirely unrelated to that, I'm not sure that they would get access to that. But, yes, there is the general principle of having unfettered access to anything in relation to the financial work assurance that they're doing, which I think is at the heart of your question. CHAIR: That phrase 'unfettered access' is really what the perception is, that is, an auditor would arrive and people would go, 'They're going to ask for anything, so we need to be ready to hand over everything related to the financial documents.' Ms O'Rourke : Yes. For the auditor to complete the work that we as a system expect of them in providing that verification and assurance, their capacity to access the information that they need to be able to carry out that work is wide. CHAIR: Having established that, let me just say that, in this hypothetical scenario, Partnership ABCD is an external auditor for the firm Tate Transport, as we've called it. Tate Transport had, at one point, decided to go to audit tender but, ultimately, had stayed with Partnership ABCD, as other audit firms were viewed as unethical. Partnership ABCD then used its access to audit documents to steal data on rival bids, potentially including things such as pricing, resource allocation and skills. Partnership ABCD then used this privileged information on rivals to inform their own audit tenders for other firms. Ms O'Rourke, in that scenario, what laws could have been broken by that audit by Partnership ABCD? Ms O'Rourke : Thank you for your question and for setting out the issues as a hypothetical. I think, in circumstances of a hypothetical, it can be difficult to be conclusive about particular provisions that might apply or, indeed, might have been broken, because of the wider circumstances, different evidentiary points and other things that might be required. CHAIR: Exactly. We're doing first principles here. How does this work? I want people who don't engage with this sector very much to understand this. We're here to make sure that there's communication with the Australian public in a way that they can understand. Ms O'Rourke : I think part of my hesitation is that we're able to assist with more precision in relation to provisions that go to the preparation and completion of an audit. So there may be information sharing or other aspects of the hypothetical which you've put that are under wider provisions, whether they be contractual or otherwise, that may also be enlivened, in relation to which ASIC might not be as helpful. CHAIR: Let me break this down a little so that we can get some clarity around it. If Partnership ABCD goes in and steals data on a rival bid, what laws could they have broken by undertaking that action? Ms O'Rourke : I'm sorry. I think I would have to take some time to think about that in order to come back to you and give you an accurate and complete answer. As I've said, I can speak to what aspects of it are regulated and complied with, with respect to actions as an auditor. But I think that wider question around whether there are other laws that may have been broken— CHAIR: I'm really only interested in the auditing laws, being the bits that you guys are aware of, not in other espionage-type things. If Partnership ABCD goes in and, on arrival, gets data about pricing, is that okay, or is it not okay? And what have they breached in doing so? Ms O'Rourke : As for the provisions that govern how an auditor is registered and then conducts an audit, I don't know if they speak directly to confidentiality. They're cast more widely around an auditor's professional behaviours and the audit quality provisions that apply. CHAIR: This sounds way too ambiguous. I'm sitting here and thinking about an Australian person who says, 'They went in and took information about pricing,' and that's either right or wrong. It is either enabled or not enabled. Ms Court : I will have a try. CHAIR: Pricing, resource allocation, skills? Ms Court : Yes, I understand the context for the hypothetical, with all the reservations about hypotheticals that, no doubt, you will indulge us with. As we've discussed at this committee many times before, in relation to the work that ASIC does particularly, we deal with registered company auditors and not the conduct of the firms themselves. We have talked a lot about whether that is a gap in the law, and I think we've been in heated agreement that we think it is. In the scenario that you are contemplating, it occurs to me—Mr Savundra may have some additional views—that a range of laws may be broken there. They may be criminal laws. Indeed, we know that there has been a criminal investigation in relation to a similar fact scenario that we have talked about previously at this committee. There may be competition laws that are broken if you're stealing sensitive pricing information and using it to your advantage. Of course, there are professional conduct obligations that, again, we've talked about at this committee. Also, there may well be laws under the Corporations Act that we could find out about. So I think we're saying that, while hypotheticals are difficult to speculate on, there is a range of potential laws in the circumstances that you have outlined, both criminal laws—potentially competition laws under our Corporations Act—and potentially, obviously, professional conduct laws. CHAIR: Perhaps we can go to the professional conduct laws, over which you do have significant oversight. Let's talk particularly about one of our favourites, which is APES 110. Does the sort of behaviour of accessing audit documents to steal data on rivals' bids, including potentially pricing, resource allocation, skills, draw negative attention? Is it a reproachable act or is it common practice for these things to occur? Ms Court : Again, Ms O'Rourke would be better placed to speak to the details of that particular set of obligations. But at a high level I think we would completely agree with you that to steal information and use it to your commercial advantage would raise a range of issues, both professional and potentially other laws. As for which particular provisions that would fall under, we would have to look at the particular facts. But certainly I do not think anyone could quibble with the fact that the scenario that you're placing raises a whole range of very significant issues. CHAIR: Mr Savundra. Mr Savundra : Perhaps I could clarify. The lead auditor would have an obligation under the auditing standards. Those auditing standards extend, as you've mentioned, to APES 110. So we're talking here about the individual registered auditor rather than the audit firm. CHAIR: That was to be my next question, so well anticipated, Mr Savundra. Would ASIC be able to take broader actions against Partnership ABCD or just the auditor or auditors who are directly involved? Ms O'Rourke : That is an area we've discussed before, and I think we've provided information that our regulatory provisions apply to the registered company auditors and not the firms. CHAIR: Thank you very much. I think that sets the ground and reflects general community understanding at this point in time. During the last hearing, the ASIC oversight committee spent some time considering KPMG's audits of Star Casino. It was here that Mr Savundra stated: But to the extent they are operating as an external auditor, they're under statutory obligation to report misconduct to us. That falls within our jurisdiction. Can you please articulate how auditors' actions and ethical behaviour fall within ASIC's jurisdiction. Ms O'Rourke : Would you like some more information about the reporting obligations? CHAIR: Yes. Perhaps Mr Savundra might be able to respond first, seeing that it was his statement, and then we'll come back to you, Ms O'Rourke. Mr Savundra : There is a statutory obligation for a registered auditor to report misconduct to ASIC. I'll see whether I can get more specific detail about the obligation. It goes to contraventions or suspected contraventions of the Corporations Act and refers to 'attempts to unduly influence, coerce, manipulate or mislead a person involved in the conduct of an audit, or interference with the proper conduct of an audit'. CHAIR: That's very specific, and you can get to that when you're at that point that you're advancing. But one of the key things was to mislead, and deception in any form across any role within the audit sector is probably not a good thing to be engaging in. Certainly, it is at odds with APES 110. Ms O'Rourke, do you want to add anything? Ms O'Rourke : No. I think that answers the specific question of the reporting obligation, unless there was additional information in relation to that would assist you? CHAIR: At this point in time, I'd like to table a public letter. I'm sure you're probably aware of this letter already, but I'll table it just for people to read it. It's from Lendlease to this committee. Do you have a copy of that letter with you? I have copies here that I can give you. Ms O'Rourke : We don't. CHAIR: Copies are coming to you now. I'll wait for those to arrive with you so I can just work through the document. I would like to be clear that, in any of the questions that I'm asking of you, I'm going only to things that are now in the public place, having been received by the committee in our formal processes. As you can see, there is a copy of the letter from this committee to Mr Lombardo, Chief Executive Officer and Managing Director of Lendlease, which is a rather large company. In fact, as we drive down from the parliament, it's lit up every night with about six major cranes there. So this is no small fly-by-night, beginning-to-be-established business. It's a long-established, sophisticated signature business, I guess, in our development sector. Following that is Mr Lombardo's response to our questions, and I take you to page 2 of that. Highlighted on that page is that 'KPMG personnel on Lendlease audit team retained and utilised access to audit tender pictures in Lendlease Board papers to inform their tender for Westpac's audit'. Further, Lendlease described these actions as 'not acceptable'. Do you agree with that, Mr Longo? Mr Longo : I'm still reading it. Ms Court : I'm so sorry. I don't know that we have a highlighted bit on our copy. CHAIR: Perhaps we can just take point 5. I think that gives us the context. It states, 'Since your statement in the Senate on 24 March 2026'—I do have copies of that statement, if you need to refer to it. Do you need copies? Ms O'Rourke : We have your statement in front of us. CHAIR: Yes. It says: Since your statement in the Senate on 24 March 2026, KPMG has contacted Lendlease and through further conversations Lendlease has been advised of new information not previously disclosed to Lendlease. The person to whom they're talking is at KPMG. The key points of those conversations can be summarised as follows: a) KPMG has advised that KPMG's audit partner accessed via a folder in Diligent two documents from the Lendlease Board papers. KPMG advised that these documents were put on a screen in the presence of the KPMG audit team then tendering for the Westpac audit. b) In a face-to-face meeting on 31 March 2026 KPMG showed one of these documents to Lendlease and advised the nature of the second document. c) KPMG acknowledged that the audit partner should have advised Lendlease that it had access to the audit tender folder in Diligent and should not have viewed any of the documents in that folder. d) KPMG deemed the documents to be of "low sensitivity" and gave KPMG "zero competitive advantage". Mr Longo, the statement that I want you to reflect on states: Lendlease has advised KPMG that the actions of its employees are not acceptable and is in discussions with KPMG as to the actions to be taken. I seek your perspective on that, Mr Longo. Mr BUCHHOLZ: Before the commissioner responds, perhaps I can advise the committee that 10 minutes ago Andrew Yates, KPMG Australia's boss, quit. CHAIR: We might get a copy of the news about that. Mr BUCHHOLZ: The article cites that it's due to the whistleblower allegations. CHAIR: Thank you very much, Mr Buchholz. Now for your response, Mr Longo. Mr Longo : I can give you some observations. I think, in the circumstances set out in the letter, it's entirely understandable, from Lendlease's perspective, that what happened was, to use Lendlease's word, 'unacceptable'. There's clearly been a breach of what would normally occur between an auditor and its client here. Also, as the letter itself points out, this is something that Lendlease and KPMG are going to have to sort out between themselves. But the circumstances that are set out in the letter are clearly unacceptable and, no doubt, there will be some further action that Lendlease will expect KPMG to take to ensure this doesn't happen again. CHAIR: I do note that there's a commercial relationship between Lendlease and KPMG. KPMG, I'm sure, has many clients, including the federal government, who today would be saying, 'If they can do this to Lendlease, what the hell could they be doing too little old me?'—someone further down the food chain in terms of strength, power and continuity of business, status and capacity. So, apart from that action of a commercial nature between the two who have engaged in the contract, Mr Longo, what actions is ASIC taking, or can ASIC take, to investigate and sanction KPMG on this matter? Mr Longo : It's something that we've discussed, and I will ask Commissioner O'Rourke to answer that particular question. Ms O'Rourke : I can confirm that ASIC has commenced a preliminary investigation into the allegations about the conduct of a number of the registered company auditors at the firm KPMG. Just to be clear, it's in relation to the registered company auditors rather than the firm itself. We commenced these inquiries after a meeting with KPMG on 14 April and then after receiving further anonymised, in that case, information in writing from KPMG on 29 April 2026. So, as I think the committee is aware, KPMG has been conducting its own investigations and sanctions there. But we've identified that three of the four people involved are registered company auditors and, therefore, in response to the earlier comments, they come under ASIC's regulatory oversight. CHAIR: So that is three of the four people. Can you identify who they are? Ms O'Rourke : Let me see if I can do so. Ms Court : We don't have information in front of us as to who the individuals are, but we can take that on notice and find out if we're able to provide it. CHAIR: If you could provide it in a timely way, I think it would assist with the clarity of our communications today. I'm advised that KPMG's head of audit is also stepping down from leadership and will then resign from the firm. Is that at your urging, Mr Longo? Mr Longo : I'm not aware that ASIC has asked for that to happen. It's my understanding that this is a matter entirely with Mr Yates. I understand that Mr Macpherson, the firm's head of audit, is also stepping down. This is a very large firm with its own governance arrangements and structures, and these decisions were made, as far as I know, independently of ASIC. Senator SCARR: Has ASIC received any communication from KPMG in relation to this matter, such as a letter or anything like that? CHAIR: Did they advise you that they were undertaking this action? Ms O'Rourke : I referred earlier to meetings and information provided in April. Is that your question, Senator Scarr? Senator SCARR: Either that or a letter from KPMG in relation to Mr Yates? Mr Savundra : Perhaps I might take that question. We received a letter this morning advising us of what's appearing now in the media. Senator SCARR: This is the point that I'm trying to flesh out. So they did give you notice today, before the story broke in the media? Mr Savundra : I believe so. I've not had time to engage with the detail of the letter, but it came in just before the hearing started. CHAIR: Can I say that I'm a little surprised that you didn't advise us of that at the commencement. Senator SCARR: It might have happened contemporaneously. Mr Savundra : As I've said, I've just not had the chance to read the detail of the letter, but we were advised. Senator SCARR: Perhaps I can ask you, through the Chair, to have a look at the letter. Chair, I seek a formal tabling of the letter, for the benefit of the committee. CHAIR: Absolutely. Thank you. Is there anything else in the letter that you think we should know about at this point in time? We know that Mr Yates has gone, as well as the firm's head of audit. Who is that person? Mr Savundra : I'll need a couple of moments. If we could come back to this, I would— Mr Longo : Clearly, that's McPherson, according to the press release. CHAIR: Mr McPherson and Mr Yates. Are there any other imminent resignations or changes to the leadership of KPMG of which you're aware? Ms Court : I think, as Mr Savundra has said, this is happening in real time. We have a letter, and we need some time to look at it. I'm very pleased to table the letter. Perhaps we can read through that in the morning break and come back to you. We're really trying to digest it as we're speaking to you. CHAIR: It wouldn't be a difficult question to answer: are there any other names of people departing that we should expect to appear in the media? Mr Savundra : Perhaps you can give me just a couple of minutes. CHAIR: Yes, come back with that. We can go into more detail once we get a copy of the letter. Mr Longo? Mr Longo : Perhaps I could just note that it's not unusual for me or a commissioner to be given a heads-up about a particular appointment or, on this occasion, a particular resignation of a major entity. It is not and never has been ASIC's practice to have us announcing to the media a relevant resignation or appointment. So it was certainly through no disrespect to this committee that we didn't mention the existence of the letter. We were given a heads up, and it's a matter for KPMG to then make their announcement. It's not something we would normally do, with no disrespect intended to you or the committee. Ms Court : I note that, Mr Longo, and I am sure that's sincere. I just think it's very interesting that, unless the secretariat advises me otherwise, we didn't receive a copy of the letter. We'll go hunting, just in case. Senator SCARR: KPMG didn't give us a heads-up. CHAIR: I don't think so, and I think probably the public record reveals that. Senator SCARR: Absolutely. Mr BUCHHOLZ: I think they know where we all are today, though. CHAIR: Yes, they might do. Clearly, in audit, the issue of trust is critical. With regard to the board papers and the specific matter of Lendlease, what elements of the trust equation, which is part of what you would oversee with those registered company auditors, has been breached in that particular instance? Ms O'Rourke : As I mentioned earlier, I think we have commenced an investigation in relation to some preliminary investigations into the allegations of the conduct, with the focus being on the duties, under the Corporations Act, with which a registered company auditor must comply. At this point, our work in relation to that is too early to conclude, as I think was your question, what has been breached. I think we're too early in our investigations to make any conclusive statements to that end. But we are looking at each of the specific duties that do apply to a registered company auditor, including those that go to independence. As you know, over the last couple of years, conflict management and independence areas of extensive focus for ASIC, and those general independence requirements as well as those that are more prescriptive, which have a more limited scope, areas that we'll be considering carefully. You will know as well that there are a number of different aspects to the auditor registration process, including not only capability skills but also 'fit and proper' provisions, so that will be another area for our inquiries. CHAIR: Before I move off this 'fit and proper', I think there's a common understanding of that. In your parlance, Ms O'Rourke, what constitutes a fit and proper person for undertaking audit and leading an audit company? Ms O'Rourke : I think it's a very important part of the requirement that we assess as people become auditors. As I have said, that capability, skills qualification and experience is very important but, to be fit and proper, the conduct of the person in taking on such an important role in verification and assurance of the financial statements is significant. We do have regulatory guidance in our RG 180 that sets out the different elements that, in a practical sense, we look at to assess 'fit and proper'. But I think you can set the policy basis or goal to which they lead beyond those; it's about the ethical standards that we talked about earlier in APES. It might not be what's applied technically, but I think your question goes to what ethical conduct do we expect of our auditors, if you step back from the specifics, and I think we do expect a high level of ethical conduct. CHAIR: In your view, do the behaviours that are documented in the letter from Mr Lombardo meet the fit and proper test? Ms O'Rourke : I think the answer comes from the fact that ASIC has an active investigation to explore that, because we have concerns that they may not be so. CHAIR: Thank you very much. It has been put to us on many occasions that the concept of ethical walls is one of the critical tools of management of ethical behaviour in these large companies. Ms O'Rourke, how are ethical walls in a partnership meant to operate? Ms O'Rourke : I haven't heard the phrase 'ethical walls'. Certainly, there are information barriers. CHAIR: I think we used to use a much more jaundiced term— Ms O'Rourke : Yes. CHAIR: but we don't use that anymore. Ms O'Rourke : No. That's right. CHAIR: That's the concept to which I'm referring. Ms O'Rourke : Yes, information barriers. There's the idea that, to the extent that a firm may be working for and engaged by multiple clients, there is a requirement that those clients be kept entirely separate. That is what I understand. We also have managing confidential information guidance, because this applies to lots of different firms. That is about the very practical and extensive steps that are expected if a firm is acting for more than one client. Obviously, they do act for more than one client but, when doing so, it's essential that they keep the information and the contact between people, as well as the IT or document management systems, completely separate. CHAIR: I have one more question. I'll then come to Senator Scarr and return to this a little later. Mr Longo, are you aware of the whistleblower allegations in toto that I raised in March this year in the Senate? Mr Longo : I'm generally aware that whistleblower allegations have been made, but I'm very reticent about being able to talk about the content of those allegations. I think, again, I'll defer to Commissioner O'Rourke, who has done a lot of work on this topic. CHAIR: Perhaps, at this point in time, I can summarise. ASIC is aware of them, even if you are not involved with this matter intimately, Mr Longo? Ms O'Rourke : Are you referring to the whistleblower allegations that were shared with the press? CHAIR: Yes—and that I put into the Senate. Ms O'Rourke : Yes. We have that transcript. CHAIR: Given your answers already, can I assume that you have some interest in those allegations? Ms O'Rourke : Yes. CHAIR: And they have triggered some action from ASIC? Ms O'Rourke : Yes. CHAIR: Including the commencement of an investigation? Ms O'Rourke : Yes, I have referred to that. Ms Court : Noting the committee's interest, perhaps I can put a little more on the record and be as forthcoming as I can. As Commissioner O'Rourke has said, we have commenced a preliminary investigation into allegations about the conduct of a number of registered company auditors at KPMG. Ms O'Rourke gave evidence a moment ago that three of those are registered company auditors. We started those inquiries in April. We've had further anonymised information, as Commissioner O'Rourke has said, late in April. We have issued a number of notices to KPMG for production of information. We've been informed by KPMG that they intend to claim legal professional privilege over much of their investigation material. I know that we have had lengthy discussions at this committee on prior occasions in relation to the impact of legal professional privilege claims on ASIC investigations. So, while that's not uncommon, it is something we'll have to navigate as we work our way through the investigation. CHAIR: Can I interrupt to say, for the record, we have considered legal professional privilege abuse as well as the overreach of legal professional abuse and the impediments that places on ASIC doing their job in the public good. We have had that discussion many times. I will put on the public record that, with regard to KPMG, if we have reached a point where there is sufficient interest in these breaches and sufficient acceptance that there has been such a failing as to lose the CEO and the head of audit, it would be incumbent then upon those remaining at KPMG to cooperate fully with ASIC and not seek to abuse legal professional privilege in the way that we have seen as a technique in the past. I just want to put that on the record immediately. Ms Court : Thank you for that. CHAIR: I'll come back to you for your final words. Ms Court : In response to that, obviously, KPMG and all other entities that are subject to ASIC notices have a legal right to exercise a claim for legal professional privilege, and we respect that, but we do expect the basis of any claims to be properly articulated. We may challenge claims if we consider them not to be properly made. We have invited KPMG to provide the information to us under a voluntary disclosure agreement, which, from our perspective, would be an efficient way for KPMG to assist us with our preliminary investigation. But I can assure the committee that we are on to this. We're exercising our statutory powers and will be investigating in relation to those individuals who come under the ASIC jurisdiction. CHAIR: There is a legal requirement that you have outlined, but there is also a moral requirement, which is a critical part that allows social licence for all of the good work that happens in our economy to be undertaken. So, again, I would put on the record my urging of KPMG to act with moral integrity and efficiency in its interactions with the ASIC inquiry into this matter and the other matters raised by the whistleblower. I can advise that the committee did receive correspondence this morning from KPMG at 09.51. That document is coming to us, and we will also review it in the break. Mr Savundra, do you want to add anything at this point in time? Mr Savundra : Only to respond to your question. The two individuals who have been named in the press are the only ones whose names are contained within the letter. CHAIR: Thank you very much. I'll go now to you, Senator Scarr, and I expect there to be other questions as well. Senator SCARR: In terms of introductory comments, perhaps I can thank the whistleblower who brought this matter to the attention of this committee. Speaking for myself, I think it's fair to say that, certainly, we on the committee are impressed with the quality of the disclosure, and, given the detailed nature of the disclosure and the way in which it was presented, it immediately raised considerable red flags in our minds. We're now seeing repercussions flow from that which would not have flown but for the actions of the whistleblower. This underlines the importance of whistleblowers and the great good they perform for our community. I will go to another whistleblower matter in the audit area, and this one relates to PwC and corporate travel management. I just flag that with you to give you a heads-up. But, before I go there, I just want to delve into what recognition is given to whistleblowers under the Corporations Act who are actually employees of an audit firm as opposed to employees of a company. I've had a look at the provisions, and it seems to me—I will happily be corrected—that the provisions in the Corporations Act are more directed to wrongdoing within a company as opposed to wrongdoing with an audit firm that is providing assurance services with respect to a company. That's incredibly important in terms of our financial system. The concern that raises in my mind is whether there's a regulatory gap in terms of the protection of whistleblowers who are providing incredibly important information with respect to the audit of companies that are governed by the Corporations Act. I'm interested in your views in that regard. Ms O'Rourke : I think this question of the protection of whistleblowers as it applies to organisations that aren't companies was canvassed in the PJC report of the Inquiry into ethics and professional accountability: Structural challenges in the audit, assurance and consultancy industry, which was tabled on 7 November. So I do think that issue has been identified as a question mark, whether the Corporations Act whistleblower protections should be extended. It turns on that definition of 'regulated entities', as an application— Senator SCARR: Yes, we've certainly raised the issue, but what is ASIC's view with respect to that? When a whistleblower who's from within an audit organisation, a partnership, or has worked for a partnership reaches out to ASIC, how does ASIC apply the Corporations Act provisions? Mr Savundra : It's not ASIC's role to, unfortunately, advise individuals. To go back to your original question, there is an issue or a gap there, clearly. In terms of the protection, we're not in a position to advise people whether they're protected or not. That's a complex question, which will need to be looked at through the individual circumstances of each employee and their employment arrangements. Some of these partnerships do have corporate entities associated with them. They could be a contractor or employee of that corporate arrangement. It's difficult for us to provide definitive advice, but what we can say is that we will treat someone that comes to ASIC and believes they are a whistleblower, or on a lay, non-legal basis appears to be a whistleblower, as if they're a whistleblower, meaning we will anonymise their information in terms of how it's recorded, and it's recorded securely. But what we can't give any assurance on is their protections under the law, which is difficult. So that's the approach that we take. But I think it's fair to say there is an issue there about employees or others within the context of a partnership not being protected by those whistleblower protections that are to apply in a corporate context. Senator SCARR: That includes employees of audit firms that are partnerships, which are providing essential audit services to corporations, which are heavily governed by the Corporations Act; is that correct? Mr Savundra : That's right. Senator SCARR: So the whistleblower is in a position, not just in this case but generally, where there isn't really any government organisation that can provide them with advice with respect to their rights, with respect to their protections, and with respect to how to navigate these extraordinarily difficult provisions, which even I as a lawyer of 30 years standing or whatever it is now have trouble navigating through. There's no-one to act as their guide, their navigator, assisting them to deal with this complicated regime. Is that correct? Mr Savundra : That's right. In terms of government support, we encourage people to seek legal advice to assist them with that process. Senator SCARR: I note your encouragement but, again, you've got a whistleblower who's trying to do the right thing— Mr Savundra : I understand. Senator SCARR: and the onus is on them to seek legal advice, which would be extremely expensive, time-consuming and in a situation where no doubt they've been subjected to, in many cases, very onerous human resources responses within their own organisation. Their career and their livelihood may be under threat, and they potentially don't have the financial capacity to get that detailed advice. That would be a fair assessment, wouldn't it? Mr Savundra : Yes. Senator SCARR: If a whistleblower in that situation determines that they simply don't have the capacity to get that advice, then it could well be that we are deprived of the very important information which they could bring to the public's attention. Is that a fair comment? Mr Savundra : It is. Obviously, what has occurred here is protections that come through parliamentary privilege. Senator SCARR: I note that you carefully watch the activities of this committee and consider its recommendations. Chair Longo has referred to the many inquiries we've undertaken over the last few years. You're aware that the report which Commissioner O'Rourke referred to also recommended the establishment of a whistleblower protection authority to provide a means by which whistleblowers could obtain that advice with respect to these very complicated matters, get that support, get that protection, and have someone standing in their corner as they take actions in the public good? You're aware of that recommendation from this committee? Mr Savundra : I am. Senator SCARR: I want to move to the matter of corporate travel management. Before I go into this matter, I'll simply ask, firstly—because I don't want to take you into areas you can't go; I'm alive to that—does ASIC have any investigations currently underway in relation to corporate travel management, noting that it's been suspended from trading on the ASX since August 2025? We're now sitting here in late May 2026. The last financial accounts I could find lodged on the ASX announcement platform relate to the half-year ending 31 December 2024. I'll make some comments with respect to some statements I found in that half-year report shortly. CTM made an announcement to the market on 22 April 2026, which I'm going to seek to table, Chair, and provide copies to the commissioners and my fellow members. Does ASIC have any inquiry and ongoing investigation into corporate travel management? Ms Court : Yes, we do, and there's a range of different limbs of the issues that we are thinking about. Perhaps I'll put those on the record at a higher level and then answer any questions that you have in relation to them. Senator SCARR: If you could Ms Court : In relation to CTM itself, just turning to one of the issues you've already raised, the lodgement of financial reports and delays in providing up-to-date financial reports, you may be aware that CTM are late in filing more recent financial year records. They have requested extensions from ASIC for the filing of those reports on a number of occasions, and ASIC has refused now any further extensions. So from our perspective the financial year records and financial reports are well overdue, and so we are considering action we might take in relation to that. Separately to that, we have a stream of work. As you say, there were a number of announcements made to the market. CTM ceased trading in August 2025. There were announcements to the market made in November 2025. You've referred to April 2026. We're aware of those announcements. We have an open investigation looking at continuous disclosure issues and directors' duties as well. The third limb of issues that we are considering are relevant to the issues we've been discussing this morning. We are looking at the work that PwC did in relation to the audits of CTM over many years. We have an active investigation under way in relation to that. There are some registered company auditors that were involved. That's our jurisdictional hook, if you like. We have been looking at those issues since late last year. Senator SCARR: Just in relation to PwC's role, is it true to say, Deputy Chair, that this was a situation where PwC had been a longstanding auditor of CTM, there was a change in auditor, and rotation of audit firms, which is an issue that has been the subject of great discussion over many years. Deloitte became the new auditors and identified irregularities with respect to, in particular, contractual payments paid by the government of the United Kingdom with respect to services provided in the United Kingdom. Is that correct? Ms Court : Perhaps if I can just step through my understanding, which is largely in accord with that which you've just outlined. PwC was appointed as auditor of CTM commencing in 2010 and continued to be the auditor through until September 2024—a very lengthy period of some 14 years—and it was at that stage that you— Senator SCARR: Sorry to interrupt you, but I think CTM might have been listed about the time when PwC commenced. I might be wrong in that regard. Ms Court : I'm sure somebody will let me know the date of listing. As you say, Deloitte took over the auditor appointment. From September 2025 through to April 2026, following Deloitte taking over, there have been various disclosures to the market that, following a forensic accounting review, the company is expecting to reverse up to 118 million pounds—about A$220 million—in revenue that have been recognised in financial year '25 and prior financial years dating back to financial year '19—over an extended period of time. Senator SCARR: I just want to get this for the record, from my perspective, to underline the importance of this. This is nearly a quarter of a billion Australian dollars of reversals in revenue that CTM had recognised in its previous financial accounts, which it's now looking to reverse; is that correct? Ms Court : That's my broad understanding. As to whether that figure has been confirmed, I think work is continuing. The true state of affairs of the accounts, as I understand it, is continuing to be determined, no doubt, by Deloitte and CTM, but what we've seen is really a number of announcements over some months further making corrections. Senator SCARR: So on 19 February 2025, I had a look at their last financial report that was lodged, and it was for the half-year ending 31 December 2024. In relation to the European market, including the United Kingdom, the report said: With record new corporate client wins and a strategic balance between government and corporate— I'm not sure; I can't read my handwriting there— the region is positioned to further strengthen its profitability over the long term. In that last account they lodged in relation to the European market—the UK market in particular—where it looks that they may have to make a reversal of over A$200 million, they were spruiking the actual achievements they had made in that market. Are you aware of that statement they made to the market in February 2025? Ms Court : I'm not personally sitting here aware of it, but I'm sure our teams are, and I'm sure it's one of the announcements or statements to the market that we are considering as we continue an investigation. Senator SCARR: Then I'm looking at the announcement which has been released on 22 April 2026. Do you have a copy of that, Deputy Chair? Ms Court : I do now. Senator SCARR: It refers to, on page 3, the forensic review by KPMG UK of CTM UK, concluded customer contracts in the UK. It says: KPMG UK's forensic review identified: 1. Erroneous billing activity occurred given the challenges— they qualify it— the rapid and large scale nature of the engagement posed for CTM UK's process and controls environment. It states at paragraph 3: Following the detection of the Differences Amount by CTM, the exercise undertaken by CTM in 2023 (described above) was compromised because of (a) omissions and misunderstandings regarding the facts and contract terms in place with the customer; and (b) conduct by the Former UK CEO. This led to misrepresentations (by the Former UK CEO) to the customer regarding the Differences Amount and the refund of part of it. So the difference between what was billed and what should have been billed. It continues: 4. Further, there was no independent corroboration … I emphasise that phrase 'independent corroboration'— that the letter agreements with the customer were in fact signed by the customer … That's audit 101, checking that letter agreements and other contracts which are being relied upon for financial reporting purposes have been signed and in effect. I continue: … and the customer has subsequently informed CTM that it has no record of the letter agreements. Would you agree, Deputy Chair, that actually checking that letter agreements and contracts have been entered into and are in effect with respect to material financial matters is part of the bread and butter of an audit function? Ms Court : Yes, I would. Senator SCARR: Are you aware of the reports this week in relation to allegations made by a PwC whistleblower with respect to the concerns raised by that whistleblower that the relevant members of the PwC audit team were not acting appropriately with respect to red flags that whistleblower had identified in the course of participating in the audit? Ms Court : As you know, there are some restrictions in relation to what we can talk about openly in relation to whistleblowers, but can I certainly say that, at a high level, we're aware of the issues that have been raised in relation to the PwC audits. As I mentioned before, we have an active investigation underway in relation to those issues. Senator SCARR: And I note—and the chair might give a wry smile at this; she anticipates what's coming—that PwC has appointed an independent law firm to engage in an investigation with respect to these matters. CHAIR: I think we might have a very different view about what 'independent' means from some of these companies that use this as a cover, it would seem. Senator SCARR: But it does raise the question, obviously, in our minds as to whether or not ASIC—and just whatever you can tell us, Deputy Chair—is going to independently look into these matters, including what information has been provided by this PwC whistleblower. Ms Court : Again, I'll just talk at a high level to say we're aware of the issues in relation to PwC. We've got the names of the lead auditors that were on the CTM audits for the last several years. They were registered company auditors. We've got an active investigation underway. I can't help myself but wryly observe that having independent law firms appointed to do these reviews will inevitably mean that we will be facing the same issues as we're facing with KPMG, in that privilege will be claimed over the contents of that report or it's certainly a potential. I think I'm right— CHAIR: Surely not? It is impossible for PwC and KPMG to continue to run ASIC round and round the table, costing the taxpayers huge amounts of money to battle them while they hide the documents that whistleblowers are having to come to the Senate to reveal. That is just an outrageous proposition, that they should continue with such egregious behaviour. We've watched it, we've noted it and we've put it on the public record. I don't think I can make it any clearer today: stop abusing legal professional privilege. Begin to act in the Australian public interest. Ms Court : I'm speculating on what we might encounter. Mr Savundra will correct me if I'm wrong, but I recall that we've previously done battle with PwC in relation to a claim for legal professional privilege, and we were ultimately successful, I think, in that matter. But you're quite right as to the amount of resources and effort that is required of ASIC to challenge these claims. Of course, everybody has that right; we don't want to detract from the very important right that legal professional privilege is. I don't want to detract from that, but I can say that we and many other regulators spend a lot of our very limited resources, both internal staff resources and external expenditure on expensive law firms and counsel, to make these arguments about legal professional privilege. I do think matters could be resolved often much more efficiently where voluntary disclosure agreements with ASIC are entered into to enable us to get to the bottom of what's really going on. Senator SCARR: I should note also two other points, just in relation to this block, Chair, before you perhaps rotate the call. The last full financial year report provided by CTM reported in relation to auditor remuneration, and PwC Australia received $733,000 with respect to its audit. But also $1.439 million was received by PwC network firms, which includes the UK, in relation to the audit of CTM. So, materially, over $2 million in audit fees were received for the last full year in which the financial statements have been provided. The second point I would just like to tease out is that we've got an Australia-UK cross-jurisdictional issue in relation to PwC again. So not only do we have the legal professional privilege issue; we've also got the cross-jurisdictional issue in relation to what ability ASIC has and what ability this committee has to obtain information and documentation that is within the province of the UK. So, with respect to ASIC's position, are you in discussions with the UK regulators? This is an issue of a listed public company on the ASX that has substantial subsidiaries operating in offshore jurisdictions—in particular, in the United Kingdom. The allegations, in particular, relate to audit matters and revenue recognition in the United Kingdom. To what extent, and how do you, liaise with the UK regulator with respect to those cross-jurisdictional issues? Ms Court : In relation to whether we've been liaising with the UK authorities on the CTM and PwC issues, I would have to take that on notice, but I'm sure someone will let me know in the course of the morning whether or not that engagement has been had. Mr Savundra is telling me, yes, we have. Are there any other details, Mr Savundra? Mr Savundra : No other details, other than to confirm we're engaging with the relevant regulator in the UK. CHAIR: Can I just clarify that response is in particular with regard to CTM or is it on other matters as well? Mr Savundra : I believe it's CTM and PwC but, if I could, I'll confirm if it's both. But they're obviously connected. CHAIR: If this line of communication is open, as you've indicated, Mr Savundra, can I indicate that the committee, in its previous form, requested a copy of the Linklaters report, which was PwC's—and I'll put this in inverted commas—'independent' review of the whole failure of PwC, which is well documented publicly, to act ethically. That document has not been provided despite multiple requests by senators of this committee in the last parliament. I put on the record again a request from this iteration of the committee for the Linklaters report, which is now trapped, as far as I can understand it, by a clever structure in Britain. So it would be very good for us to see what happens there, and for PwC to take the moment, as I say, in a redemptive way, to begin to rebuild trust, which is certainly the language they're using in the press releases they're putting out. We need a bit of form to that verbal commitment. Senator SCARR: I just observe, wryly, that the latest reports suggest PwC, in relation to this matter, is going down the independent law firm route, which will probably be a law firm—I don't know where that law firm is located; it could well be located in the United Kingdom—that's doing the investigation. It could well be we are left in the same position in terms of trying to access information which is ring-fenced in the United Kingdom. It would be extremely disappointing if that were the case. I will just put that on the record before I hand back the call. Mr Savundra : If I could just respond to your previous question about when CTM was listed on the ASX, I believe it's 15 December 2010. Just in relation to that international engagement— Senator SCARR: So that means that PwC have been the auditors of CTM since it was first listed, and it does raise the question in my mind as to the accumulated amount of fees received by PricewaterhouseCoopers in relation to CTM, including in relation to the work provided in the leadup to listing, and how much revenue CTM, and perhaps some of the partners, had received in relation to CTM since it was first listed. Just for the record, that means PwC had been the auditors of CTM from when it was first listed up to 2024? Ms Court : It appears that way. Mr Savundra : FY19 through FY24 were the years that PwC was the auditor. Senator SCARR: Sorry, what about before then, between 2010 and 2019? I thought the deputy chair said they had been the auditors from 2010. Ms Court : Yes, I did say that. We'll clarify that over a break, but that's certainly the information I've got in front of me here. Mr Savundra : I'm talking about auditors being the individuals rather than the firm. Senator SCARR: Okay. I understand the distinction. Mr Savundra : Let me clarify that and I'll come back to you. Just in relation to that international engagement, it's in relation to CTM, at this stage, but we anticipate that will extend in relation to PwC in due course. Senator SCARR: I anticipate it will too. CHAIR: Just reflecting on that observation, we have traversed this territory quite a little bit. On registered company auditors and the limitation, in terms of holding the entity to account, can I just indicate, though, that we do have the resignation of Mr Yates today. The reality is that Mr Yates has left because of his leadership role, but alongside those registered company auditors is every other partner in the structure that operates here in Australia. So partners are, in my understanding, jointly and severally liable for the actions taken. I would observe that KPMG and the rest of the big four are hugely significant entities for the Australian economy. If I can come back to my issue that I've been harping on about all the time, the reason for my motivation in pursuing this is the superannuation of every Australian. Pardon me for being a bit partisan here, but this is a proud Labor legacy that has been embraced by all governments following, and no-one is going to stand up for superannuation more than me. I never heard the word until I was an adult. I've got no connection with it. I didn't even know what a public servant was when I was a kid growing up, because it wasn't in my world. There are many Australians like me who put their trust in really brainy people who they believe are ethical to hold their superannuation in trust. Those trustees require accurate, authentic information about what's happening in all of these companies of the kind we're talking about this morning. So I want to put on the record that is my motivation for continuing to do this, and I will not rest, because superannuation is vital to every Australian. When we talk in quite esoteric terms about some of the requirements under corporations law and partnerships and structures, it all becomes a little inaccessible. But Australians understand that the facts about what's going on in companies matter. The facts matter when they're doing their finances. The facts matter when companies are doing their finances. Auditors are there to make sure there's truth-telling. I think we've seen a remarkable failure of that, and I cannot see how partners at KPMG, despite the lack of a regulatory hook, can consider themselves absolved of what's happened. They took the money from the profit that's been made by these behaviours. They can't run and hide now, despite a lack of a regulatory hook, which was a term I believe you used. I just want to say that before I follow up on the point you made about the continuity of having an auditor and what happens when there's a change. Obviously, Deloitte picked up the PwC issue. Senator SCARR: As to the continuity of an audit firm, to take the distinction which Mr Savundra underlined, you can have a rotation of the actual registered auditor, the person who's doing the audit, but in this case the issue came to light after there was a change in the firm the registered auditor was a partner of. Mr Savundra : I can confirm PwC was the auditor from 2010 through to 2024. Senator SCARR: So from listing? Mr Savundra : Yes. Ms Court : Senator O'Neill, just with your leave, can I correct something that I said earlier— CHAIR: Yes. Ms Court : just while it's fresh. We were talking about claims of legal professional privilege, and I think I suggested, if I didn't say it expressly, that we had a case where PwC had made a claim. I misspoke there, which is why I shouldn't speak from memory without the facts in front of me. What happened was that it was in a separate case that ASIC was running where that firm made a claim for legal professional privilege over a PwC report. PwC did the report. It wasn't a claim made by PwC. I just want to correct the record. CHAIR: But having said that, in the context of tax work which PwC had provided over many years, there were serious concerns around inappropriate claiming of legal professional privilege by PwC, weren't there? Ms Court : I do recall that. Senator SCARR: We recall it very well. Ms Court : I'm sure you're better placed to comment on the tax issues than I am, but the point is still the same. Thank you for indulging me with the correction. CHAIR: The proper use of LPP happens when people exercise ethical muscle rather than financial advantage at any price; I would put it that way. Can I just table a document titled 'KPMG remains on call as Lendlease's audit plan B'. It's an article by Michael Bleby, Nick Lenaghan and Edmund Tadros from 2023. I table it because it reveals, not surprisingly I'm afraid, that Lendlease has had KPMG as its auditor since 1958. So that's just for noting. We've got a 10- or 15-minute block before we break. I'm just going to go, if I can, to a table in ASIC Report 817, and I've got multiple copies here for colleagues and for you, if you wish a hard copy. Ms O'Rourke : Can you remind us which report that is, please? CHAIR: Building trust, auditor s' compliance with independence and conflict of interest obligations, published October 2025, ASIC Report 817. Ms O'Rourke : I have it here. Did you say which page you were at? CHAIR: Having tabled that, could I take you to the top of page 9 of the document, and could you just read that first paragraph for me, Ms O'Rourke. Ms O'Rourke : No problem. The paragraph comes under the title 'About auditor independence'. This is a description from ASIC, a summary, of ASIC's position with respect to this issue. It reads: Auditors are legally required to be independent from the entity they audit, to enhance users' confidence and trust in an entity's financial report. The auditor independence requirements, discussed below, recognise that independence has two dimensions: independence of mind and independence in appearance. Independence of mind means that the auditor is able to form an objective and impartial opinion of financial statements, free from conflict of interest, bias or undue influence. Independence in appearance means that the auditor is seen to be independent by a reasonable person, with full knowledge of all the relevant facts and circumstances. In other words, perception matters, and not just the auditor's state of mind. CHAIR: Can you reflect on those quotes, particularly as it relates to the matters we've been discussing this morning so far, and your knowledge of what's in the public with regard to the KPMG matters? Ms O'Rourke : As I said earlier, this question about conflicts and independence has been an area of concern for ASIC. We've looked at it through the lens of work that we've done over many years, as we've looked at particular audit files. But a couple of years ago we did make the decision to do a deep dive in relation to conflicts of interest and independence because of its significance. So this is something that ASIC has recognised as a particularly important component of our framework that applies to auditors. I think the value of the summary there is that it focuses on the financial statements being reliable, as you said earlier, whether it be for superannuation firms that we've all got a connection to; there are plenty of people who are retail investors who are making decisions themselves based on financial statements. You've spoken to the significance of the outcome, the financial statements being reliable and consistent. I think what this paragraph does is describe the important contribution to that outcome from an auditor's independence. CHAIR: General independence requirements are something that you mention here to ensure activity does not continue in conflict-of-interest situations. Have you been following along with the reveal of relationships within and outside KPMG? I'll just give you the opportunity to comment on what you've read in the papers with regard to conflict-of-interest situations that seem to be being aired in public around KPMG. Ms O'Rourke : I'm not sure if I can repeat them with precision, but I can say that we have seen that some of the questions around relationships are ones that are similar to those that we examined under this work in relation to general requirements such as professional or social close engagement. So, if I can take you to the part of the report that does speak to those general independence requirements— CHAIR: Page 24, where I was just about to go: 'Relationships with officeholders who are ex-partners'. I thought that was a pretty interesting spot. Ms O'Rourke : Yes, that's right. Our findings in relation to this report recognise the importance of people taking not a narrow or box-ticking approach to assessing their compliance with their general independence requirements, but rather stepping back and seeing whether there are multiple touch points or, accumulating over time, the length of time that some of these questions or relationships have existed, which does ask them to think about whether they remain independent as they're required to be. CHAIR: You write in this report, on page 24: We found that some auditors appeared to focus more on meeting the prescriptive requirements of the Corporations Act and showed less consideration of whether they were meeting their general independence obligations … We did not see sufficient evidence of how auditors considered actual or perceived threats to independence that could arise from the professional tie to officeholders that we identified more broadly. This was gleaned by you in your oversight of how many entities? Ms O'Rourke : I think we describe in the appendix to the report, if I take you to page 30, the methodology that we used here. So it was a little bit unusual. We started as broadly as we could to combine internal and public data and to bring those datasets together in relation to income of non-audit services. We're not really particularly talking about that part at the moment. But length of audit review—that's the prescriptive one, the auditor one. There's the officeholder relationship and some of those other ones. So we did some data cross-matching. From that wide piece we identified 123 audit clients conducted by 109 auditors, and then from those we looked more closely at 48 auditors for a review. It's not a very large sample size. It started wide, but we took indicia to have a deeper look at 48 auditors, and that was in respect of 53 clients. So they were ones we thought there may be concerns based on that preliminary data matching. It's not a random sample, it's an identified sample. So that's the basis, or the size, of the sample from which we drew conclusions, as you've seen in the report, both with respect to the prescribed independence requirements and then the general independence requirement. CHAIR: For the committee's purposes, noting appendix 2, you identify the audit firms that were involved in your review. Amongst them were Deloitte, Ernst & Young, KPMG and PricewaterhouseCoopers—EY and PwC, as they're more commonly known. Could I ask you to take on notice an indication of what I might call a heatmap of where these particular independence behaviours were most noted, and provide that to the committee? Ms O'Rourke : At a general level, I can say that our conclusions with respect to the prescriptive specific requirements not being observed were concentrated in small firms. It was in relation to the general independence requirements—I think you were just drawing me to that—that we saw concerns across a range of firm sizes. But I hear your request is for an even more specific heatmap, so let us take that on notice. CHAIR: You examine cases where an ex-partner of an audit firm had gone on to become an officeholder at the client, which is a signature of some of the concerns that have been raised in the current KPMG matter, and doing so after sometimes having audited the client while at the audit firm. I think Australians understand this. When you're supposed to come in and be, if I could put it in a common parlance, the policeman, it's hard to police your best mate, especially if they did things like be your formal sponsor to partnership, have ad-hoc catch-ups with you, professional interactions and social interactions that continue, attending alumni and other events, or officeholder held leadership positions while at the audit firm. You identified all of the things that looked like the formula for failure of audit independence in your report, and we see, in the whistleblower's evidence to us, to this committee, and the parts of it that are now released, all of these behaviours. Ms O'Rourke : Yes, and that's why we are particularly concerned. This has been an area of focus for ASIC over the last couple of years. This report is very clear about us seeing these as threats to independence. CHAIR: You note some auditors stated they did not consider that the relationship characteristics described above created a conflict-of-interest situation, and they did not appear to consider that such relationships could pose a threat to independence. There are alarm bells ringing in my ears. To manage a conflict of interest you've got to see it first. That requires an ethical disposition that seems to be absent from sufficient people in the sector that you oversee; they don't even consider relationships an issue. There is much more to traverse in the course of the day, and I want to share the call. I think we might just leave it there for the moment and go to the morning tea break. Proceedings suspended from 10:44 to 11:08 CHAIR: The committee will resume. I hope you all had a good morning tea break. It's thirsty work this morning. Over to you, Senator Scarr. Senator SCARR: CHESS. Mr Longo : Something I plan to return to. Senator SCARR: Do you? Not in terms of settlement systems, though. Mr Longo : I've got chessboards at home. I look at them; they're all beautiful, but I haven't been using them much. I assume that's what you want to talk about? Senator SCARR: No, unfortunately not, though I suspect you would be a very accomplished player. I'm talking about the ASX. This is set out in ASIC's helpful submission. I refer to the final report findings of the expert panel appointed by ASIC to look into ASX CHESS system. I was left to reflect on the final report findings. The key observations of the final report are consistent with the interim report and include: (a) resilience of critical market infrastructure has been compromised to deliver high shareholder returns; (b) governance arrangements fail to provide the necessary focus on critical market infrastructure; (c) ASX lacks the aspiration—let alone the capacity—to be a steward of critical market infrastructure; and (d) capability and cultural barriers—so not just capability barriers—are hindering transformational change. In paragraph 116, in addition to the interim report, the panel observed that: (a) risk management compliance practices need to mature to become fit for purpose; and (b) limited competitive pressure had contributed to suboptimal decision-making and risk management outcomes at ASX. In the panel's view the emergence of greater competition is unlikely to occur in the foreseeable future. They were the recommendations and findings made in the final report. Chair Longo, you've been on this journey, if I could call it a journey, over the course of your appointment. From my perspective, at the start of your appointment you were very fair and reasonable in terms of your dealings with ASX. You took on board in good faith its representations and its plans. You always emphasised to us, quite rightly, that ASX was primarily responsible; it is the deliverer of the project, not ASIC. Yet, five years later, I'm left to reflect on these final report findings, which continue to refer to all of these material issues we had spoken about and our concerns about the resilience of critical market infrastructure being compromised to deliver high shareholder returns, lack of aspiration, governance procedures and cultural barriers. I'm very interested to obtain your reflections in terms of the journey we've come on, what we can learn from it and how you see the path forward. Mr Longo : I will offer some very high-level reflections. I'm going to try to step back and be objective about it. I think it's fair to say as an opening proposition that, between us and the Reserve Bank, regulating and supervising the ASX has proven to be extremely frustrating and challenging. It really is a unique entity in the Australian economy. It's not a bank, not a superannuation fund and not an insurance company. It operates critical market infrastructure. It's listed on its own exchange. If I may say so with great respect and without casting aspersions, it has been pretty lightly regulated over many years. When Sarah Court and I started back in June 2021, it was my then belief that the supervision and regulation of ASX had to be intensified. This is a very high-level chronology, but later that year we imposed licence conditions that ASX accepted. Then, as you know, CHESS replacement A was abandoned. They started again. In the meantime, we upped our supervision through I think 825B of the Corporations Act and called for three independent reports that had to be audited. I won't go into the detail of what each one was about. We then took the unprecedented step along the way of holding ASX accountable for statements it made in February 2022, statements I might add that were unforced. These were statements made to the market in February 2022 along the lines that CHESS replacement—this is paraphrasing, because this is all subject to a hotly contested court case at the moment—was going well. I want to stress that we've pleaded the specific statements that we took issue with, but that's the gist of it, that things were okay with CHESS replacement. Senator SCARR: I think I put some of those specific statements to you through the course of proceedings in this committee. Mr Longo : You'll appreciate that there's not a lot I can say about that matter now. The trial in that matter starts in two weeks or so—middle of June. We're now into the last 12 or 18 months. It's clear that ASX is simply not making the progress that ASIC and the commissioners were expecting. Along the way, this committee made its own findings about what needed to change, including ASIC itself increasing its capability, which we took on board. I can talk about that in more detail if necessary. By the middle of the next year, we announced this inquiry—again unprecedented—because we were looking for a circuit-breaker. We were looking for: what do we do with this entity? It's simply not making the progress that we wanted of it. As with my remarks at the beginning of the day, it's like an interesting case study. What are we supposed to do? Sue them again? Investigate them again? That just simply wasn't going to work. The commissioners gave a lot of thought to this in the first half of last year and said, 'What we need is a holistic inquiry and we'll get it done independently by three individuals of high standing', and that's what happened. Around 1 June year, the inquiry started. Senator, you read out where they landed. I see the work of ASIC in this inquiry of the past 12 months as really laying a roadmap to ASX and saying, 'You really have to face up to this now.' I used the word 'hubris' at the very beginning when CHESS didn't work. It's true; it was hubris. There was shareholder supremacy and priority. They did drop the ball on investing in technology. There were cultural issues. Just recently, we know an announcement has been made about a new CEO. This week, quite remarkably, there was a very significant drop in the ASX share price. I won't try to summarise the financial details, but clearly the market now knows and understands what will be the cost to invest in what should have been happening a lot sooner. I acknowledge the work ASX has done so far. It has made some progress with governance and culture, but I absolutely also believe that we're at the 'beginning of the beginning' to channel Churchill for a moment. For the first time, we imposed a capital charge. The legal framework around that isn't as clear as we might like it but, to ASX's credit, it agreed to the imposition of a capital charge. Again, we were looking for a way of concentrating the mind of the board on what needed to be done and on what investment was required. Consequently, in order to fund that capital charge it had an effect on its dividend policy. Of course, that's the shareholders. The shareholder primacy aspect of this is really quite fundamental. The real driver of change in any company—it helps if the parliament encourages them, if the regulators encourage them and if the odd entity sues that company because they want change—is the shareholders. A key part of the findings of this inquiry is that they put the shareholders first in circumstances that distracted them from the investment required in technology. That's a potted history of the last five years. We finally have something now where there's a roadmap. There are some significant details we haven't mentioned yet, that is, the Accelerate program. I have mentioned the capital charge. ASIC itself has upgraded and changed its capability and strategic approach. We're working even more closely with the Reserve Bank, but I don't underestimate the mountain they have to climb. The other aspect of this—and I know Simone Constant will also have some views—that is really important for us all to acknowledge, which I mentioned in my opening remarks today, is technological change. The tokenisation of markets is a good example. There's just so much going on in that space globally. ASX has to keep up with that. What's happening in our global markets also implies, for me at least, some serious questioning by ASX of its technology strategy. It's not just Australia we're talking about. We're talking about an entity that's playing within a global market. ASX's performance plays out, for example, in the question of the growth and robustness of our public markets, whether they're sufficiently open to IPOs and matters of that nature. It's a really big subject. I might just pause there, but it has been a frustrating journey for the regulator. We have now reached a point where there is a roadmap. If I could repeat what you said, Senator Scarr: ASIC itself cannot reform ASX. ASX has to reform ASX. We will do our best and continue to do our best to hold them accountable. Senator SCARR: I might ask Ms Constant to give us her reflections in relation to the public market dimension of this, because it seems to me that, given ASX's special position with the management of this critical financial infrastructure, to the extent ASX doesn't keep up, Australia doesn't keep up. This is deeply concerning in terms of opportunities for all Australians in terms of the public market. I'm interested in your reflections, Commissioner, in relation to this issue around technology, what's happening in overseas markets and the absolute importance of Australia keeping up. Ms Constant : Consistent with what this committee has said in its own findings and the encouragement it has had in the years I've now been at ASIC, consistent with the panel's own words, at ASIC we consider that the reform and change of ASX is fundamental for Australia keeping pace and having aspiration for our place in the world. In terms of ASX, absolutely, we start from the premise it is critical national infrastructure. It's been part of your messaging and part of our messaging, but it's at the centrepiece of the panel's reports, both interim and final. In that regard, the change that's needed and that's called out boils down to four root causes, but this really goes to technology, strategy, governance, capability, resilience and aspiration. All of those need to come together—all of them—including the aspiration for this to continue to be a world-class venue for traded markets, not just listed equities markets as well. We often look to them in terms of the health of the public markets, but of course the ASX plays such a critical part, for example, in clearing and settlement. Austraclear has key functions where at a time of stress and resilience its functioning is most important. In the interim report and the final report, but also the package of commitments, we have a plan that gets to the root cause as opposed to hundreds of findings and some commitments that will respond to that. That includes responding to that need for aspiration; indeed, it was the panel's words. It will be critical for there to be the right governance and right capability. It is about that capability for stability right now and, for matters such as CHESS, implementing the roadmap as it sits, but also that capability and strategic thinking for where markets go. We are in the fastest point of change in financial markets, not just capital markets, generally that I think anyone has seen. It's the aspiration that can build on the strategy, the governance, the risk management and fundamentally the change in technology to support it. The package of commitments we have through the response to the interim report was really substantiated in the final report. They go to those drivers that include a capital overlay. The $150 million capital overlay that's being accrued relates to that pricing shareholder primacy and the need for understanding in that there needs to be an overlay, retention and reinvestment of capital to support not just the stabilisation. The history of outages is well known in terms of some of the need for stabilisation and resilience, but we need that capital investment to match that aspiration. We've seen the call-out for and the addressing of refreshed leadership. That's for the board and the shareholders to deal with in terms of choosing who leaders are. It was very clear that it needs the right leadership not just to get things stable but to look to the future and understand ASX's critical national infrastructure role; hence, the announcement around the new CEO. We've seen the commitments. We're working toward 30 June where we will be working with ASX to sign off, or not, on the refreshed Accelerate plan. The Accelerate plan is the details of the tech strategy and the other elements of the refresh strategy that will underpin the stabilisation phase that they're in and then that capital reinvestment, reform and refresher technology for today and for that 5-, 10-, 15-, 20-year aspiration that critical markets infrastructure has to have. Senator SCARR: I have two quick supplementary questions in relation to the capability of ASIC. How has the capability of ASIC been enhanced at a high level in terms of practical changes to assist in the ability of ASIC to perform its important role? Mr Longo : One area that we've certainly enhanced is our technical capabilities. Senator SCARR: What does that mean in practice? Mr Longo : Historically we didn't have, as we do now, the competence and capability around rolling out IT projects. That sounds like a pretty mundane and banal thing. We have a highly accomplished markets team that's expert at a whole range of things. The last two or three years we have learnt—and I'd be interested in Simone helping me supplement this—that a lot of what was going wrong at ASX or not going well enough was all to do with technology and rolling out projects. As the regulator, I think we needed to improve in that area, and we did. We hired some really good people to help us interrogate more effectively and intelligently what they were telling us about their progress with technology projects. In fairness to everyone, I think we might have been able to do that in the past. That's one area. I think Simone has already touched on this, but another area is a broader perspective around market development, market infrastructure and technology. That requires a specialised input as well. The big one, for me at least, was increasing the capability around how do you more effectively supervise an entity that has this huge technology debt? Remember, in terms of this market stream, there was amazing work across market cleanliness, market manipulation, market infrastructure in general and development of markets. There is a whole range of activity that doesn't require that technology expertise, but for me that was a big change. Ms Constant : To expand on that, the way we have thought about ASIC and what ASIC does in its approach is start with the joint supervisory approach with RBA. As the panel identified, we need to make sure we have as high a functioning joint supervisory approach as possible, not just so that's the way the ASX feels it but so that we can focus on getting the most effective outcomes that we want in terms of bringing the best of both organisations to bear. We start from there and understanding our roles in working together. For example, we've created a standing committee—chaired by my peer at the RBA, and I attend, as do some of our team—to make sure we coordinate on the key priorities. What are we most worried about? At the moment, it's quite helpful having the root causes and the commitments but not just that. What are we most worried about? What are we going to focus on independently? Where do we need to converge and come together? Secondly, we've focused on people. Mr Longo rightly called out people first, people first, people last, always in organisational health. We have great people who have been working in this space tirelessly for many years. We needed to boost that. We've brought in, for example, a new senior executive leader from the private sector who has operational risks, system implementation, AI experience and risk management capability who really understands system implementation and these risks, what organisations go through and what supervision looks like. In this space, we are the frontline supervision. We have almost a prudential role, certainly frontline supervision, and that team is being invested in, including, importantly, with some of the people who supported the inquiry. I'll get to the inquiry in a moment, but the inquiry was supported by what we think was a crack team drawn from our own resources but also from APRA and the RBA. There's a lot we can continue to learn from peer regulators on supervision and how the RBA thinks about system stability. A number of those resources have stayed in place to see things through. The third limb is governance. Governance is important for us as well. The commission has established a commission markets committee, which meets fortnightly and which I chair, that gives us the space and time to really dedicate and focus on these issues, which have always been well focused on through the commission proper but which gives that focus and space. Finally, a different thinking and approach is part of the capability as well. It's the first time we've done something like call together that panel. Thank you for your positive remarks about the way we went about calling the panel. We went and got that capability and expertise and opened ourselves up to that. We held ourselves over to say: 'We're not getting the results we want. This is so important. Give us insights for our own capability and how we do things.' We've responded to that. We said, 'Tell us what you think needs to change.' They did 140 interviews. They read 10,000 documents. They're three of the most eminent directors in Australia. We brought that weaponry to bear because we thought about the size of the problem. We now have that intellectual property that we're taking forward. It's not the first and it won't be the last of our engagement with the external market. Soon I'll be chairing a roundtable and we'll be inviting a lot of leaders in financial markets, including the innovators and the stabilisers, to turn our mind not just to what's happening now in ASX but to where your question was going: what's happening next and what do we need to do? You can only focus on a few things and do them really well in this space, but what are the big few things we as ASIC need to do to ensure we are promoting and not getting in the way of the innovation that comes next? Senator SCARR: I congratulate everyone who has been involved in relation to that inquiry, including all the members of the panel, for their public service. It really is public service, agreeing to participate in the panel. I also recognise the work of the crack team from ASIC to which you referred. I wrote that phrase down. Thank you to all the members of the crack team. I think it has been a very important piece of work. I really do commend ASIC in relation to it. Ms Constant : Senator Scarr, thank you. That is very meaningful for them. Senator SCARR: My last question you can perhaps take on notice, but, Mr Longo, over the last five years, as you know, I hang off your every phrase and word. You mentioned that, in relation to the capital charge, the legal framework was not as clear as perhaps it could be. If you could take on notice and maybe provide us some detailed commentary in relation to that, because obviously we're interested. Mr Longo : I'm glad you have an interest in the capital charge. Unlike APRA, which has very clear powers in this area, we don't. We did a lot of work at the time to bring that result about. We'll have a quick go at answering your question now, but if there's anything left over to say we'll do a supplementary QON. Ms Constant : We'll come back with the detail, but we had advice and information that suggests this was available to us. The reason that we did not, as Mr Longo was referring to, need to go through that route, for example, of using licensed conditions or exploring other routes was that, when the panel put forth the interim report which we supported, the ASX accepted that and made that commitment to address those root causes with that package of commitments. They've given detail and they're underway on putting that capital base away that needs to be there this time next year. We can come back with some of the detail. Senator SCARR: Thank you. CHAIR: Senator Whiteaker. Senator WHITEAKER: I have some questions about the ASIC Moneysmart Gen Z financial behaviours report 2026, which is a really interesting report. Thank you for your work on it. There are a couple of issues that really stood out to me about this report, which talks about how Australians between the ages of 18 and 28 manage their finances and consume information. Really, the key findings, which you point out in the overview of your report, are that this generation of young people is highly engaged with financial decisions but is increasingly exposed to riskier investments through unregulated digital channels. I want to explore some of those with you today. Perhaps to start at a high level, when you say that young people are increasingly exposed to riskier investments, how would you define 'riskier investments'? Mr Longo : I will ask Commissioner Kirkland, who did most of the work on that subject and has carved out a niche for himself in the radio world, to explain this. I can't possibly compete with the way he explains things so well. Mr Kirkland : Those observations, I guess, were founded in some of the research findings about the degree to which young people use social media for financial information and guidance. This is by no means surprising but, in that research, we did find that 63 per cent of Gen Z said they use social media for financial information and guidance; 30 per cent use YouTube; and 80 per cent use AI platforms. 'Riskier investments' is a fairly broad term but, to give you some of the examples, there are several categories to our work. We've done a lot of work in relation to investment scams. Commonly, we see people being exposed to ads or posts on social media about investments that don't exist. In some cases they'll be encouraged to join private chat groups or closed communication channels, which means it's much harder for us to see what's going on. Then they're subject to a hard sell, to be honest. Often, the sorts of investments that are spruiked rely on claims about technology. They might claim that superior returns can be achieved as a result of bot-driven trading that can outperform the market. There might be claims about the role of AI in generating superior results. We also see characteristics of some of the influencers. They're often using images that promote a lavish lifestyle, posts that at least make it look like they're in exotic locations overseas and driving luxury cars. Often they're pointing people to investments that either are complete scams or involve higher degrees of risk. For example, in the category of those that might be actual investments but involve higher risk, cryptocurrency related investments are a key category that we observe. That term 'riskier investments' is a broad category, but we see quite a lot of examples where, if people are getting information that doesn't accurately reflect that risk, that can involve risks to those individuals if they place their money there. Senator WHITEAKER: Do you have a sense of who is behind this push in the digital space to young people? Do you think it's people based here in Australia or is it foreign actors? Do you have a sense of where this is being driven from? Mr Kirkland : It's fair to say it's a mix. Sometimes it's not possible for us to establish with certainty from where somebody is operating. If we can identify people who are operating in Australia who, in our view, may be breaching Australian law, we'll consider taking action. One area where we've done that is in relation to finfluencers. We've done several waves of action over the last few years in coordination with regulators in other countries really cracking down on people giving financial advice online without the appropriate licences. As part of that work, we've written to and formally warned a number of finfluencers that we considered were operating in Australia without the appropriate licences or authorisations. A number of them have changed their practices. They've stopped doing that, have taken steps to obtain the appropriate licence or authorisation or they've modified their behaviour so that it's potentially not providing financial advice. Some of that work has been effective, but we then have also identified some people involved in that activity who appear to be operating from other jurisdictions. It's much harder for us to act in those situations. Senator WHITEAKER: I turn to AI platforms, which your report also talks about. It found that 64 per cent of Gen Z has moderately high trust in AI platforms for financial information and guidance. You regulate financial advice as it's given, rightly or wrongly, by finfluencers, as you refer to them, but do you have any scope to regulate an AI platform providing financial advice to young people? Mr Kirkland : It's an excellent question, particularly in the context of that research. I think the best answer, as is sometimes the answer in relation to these areas involving technology and evolving business models, is that it depends. It does depend on the very specific circumstances. In general terms, if a person or an entity is providing financial advice in Australia and are carrying on a financial services business in Australia, that would require them to be licensed. Financial advice generally involves encouraging somebody to buy a potential financial product or influencing a decision that somebody might make about buying a financial product. It would depend on whether that's the nature of the information that somebody is getting when they engage with an AI platform. It would also depend on whether the entity that is behind that AI advice is operating a financial services business in Australia. There are probably a few other more technical tests under Australian law. It's an area of great interest for us. We are looking closely at it. It features prominently in my discussions with people across the industry. In our discussions, some of which I do jointly with Commissioner Constant, with superannuation funds, with financial advice licensees and a number of the other major institutions, it's something they're interested in as well. There are a lot of people across the industry who have been very helpful in providing examples to us to help us understand what's happening right now and start to think about what our role might be. Senator WHITEAKER: This question is related but slightly different: do you have a sense of how financial advisers are using AI to inform their work? Mr Kirkland : At this stage, we don't have a detailed understanding of that. It does feature in our conversations with financial advisers. Of course, a number of financial advisers are using AI because AI technology is embedded in so many common business tools. We can just take that as a given. To the extent that people are giving us insights into how they're using AI at the moment in financial advice, we're hearing that it's more in back office functions than in ways that are heavily involved in the advice that's provided to consumers. Again, it's an area of interest to us. I think we'll be doing more work in that area over the next few years to understand what are the current practices, what are the patterns of use of AI across the sector, any areas of concern to us and, indeed, how that's evolving, because it is an area that's changing and will continue to change very fast. Senator WHITEAKER: Thank you. That's very useful. CHAIR: Ms Jarrett. Ms JARRETT: Before I go into my questions, I just want to build on Senator Whiteaker's comments because I just googled: 'I'm 25 and I want to invest in Australia. What do you recommend I invest in?' FYI, I got a lovely list. Senator WHITEAKER: What does it say? Tell us. Ms JARRETT: Firstly, it says to have an emergency fund and then diversified ETFs. It talks about superannuation and then lists a number of different groups. There you go. Yes, it's a difficult area but one we do have to get on top of. Back to my questions. I wanted to talk about—and we did this last time—the public versus the private market. I know you have a lot of work underway in that space, but I understand that the public equity market in Australia is about $3 trillion, that IPOs are low and that global private assets under management have tripled in the last decade. Recently, I saw a figure in that respect—$14-plus trillion. Recently, I saw another data point estimating the Australian private credit market has increased 500 per cent in the past 10 years. As you rightly said in earlier hearings, a shift is happening in our market. Can we focus first on the public? You do have a lot of work underway in terms of trying to accelerate IPOs et cetera. How is that going? Are we seeing any slowing of the decline or even a turnaround? Mr Longo : In terms of new IPOs in Australia, I think we can all agree that it's been a bit disappointing in that we haven't seen a big uptick. I should hasten to add, though, we're not alone in that. Even in the US, as recently as six months ago the SEC Chair, Paul Atkins, gave a speech on this very topic. I think he called it 'Making IPOs great again' or something like that. This question of tapping the public markets is an issue that a number of jurisdictions are facing. It's equally fair to say that the US is unique in and of itself given what's going on there with SpaceX and a whole range of other entities. It's an extraordinary public market. My first point is that, in terms of the issue we're facing with public markets, we're not alone. Singapore and the UK have these issues. I'll get Simone to comment on this in more detail. We've done probably as much as we can within our regulatory framework or remit to encourage or facilitate IPOs. There's a little bit more work we're doing, but this is something the ASX has to look at more closely. The other aspect of this is that there are structural considerations about why investors might support a public market and why they may want to be just at a high level of the private market. We've published some really good analysis led by Professor Carole Comerton-Forde, who we commissioned to do this work. It's a nuanced picture. We continue to try to be agnostic between private and public markets. Even having said that, the overall sentiment is that we all benefit from active, robust public markets. As things stand, about a third to a quarter of the ASX is owned by our superannuation funds. We like the price discovery, the transparency and the accountability. It's not so easy to achieve that with private markets. Before I finish my very high-level remarks, private credit is definitely something we are continuously looking at. The data on that isn't great. We published a report in the middle of last year—and Simone might be able to correct me—where we estimated the size of the private credit market this time last year in Australia was around $205 billion, which is relatively tiny. In the US, it's huge and it's across a whole range of sectors across the economy. Our private credit sector tends to be concentrated in property—very often higher risk property investments—and construction. Again, I'll ask Simone to speak a bit more about that. We don't have as much data as we would like. It's a bit opaque. We publish reports about where we think there needs to be improvement. This applies also in terms of disclosure, managing conflicts and valuations. It's fair to say there has been some hand-wringing about what's happening in private credit markets but, as far as Australia is concerned, it's still a pretty small part of our economy. Private credit done well is not to be discouraged, but it has to be done well. I will ask Simone to supplement some of those observations. Ms Constant : Thank you for picking up on our work regarding IPOs. The focus first on IPOs in the health of the public market was about continuing to do our best to be part of ensuring opportunities are brought to the Australian market. I have some information on most recent listings—there's been a couple this year—but there's only probably been two of note. Mr Longo has identified that this is not just a domestic phenomenon, but we've tried to look beyond what is domestic, what's our part in this and what part can we play. When it comes to the health of the public markets, we're now turning to the next part in the journey of a company—staying listed. When we went out and did all the work over the past 18 months and asked all sorts of stakeholders, got 100 submissions and engaged in so many forums, we found that sometimes it can be hard to stay listed and grow in the Australian market. It's that balance of effective disclosure, transparency and also some of the rules around listing et cetera that, as Mr Longo referred to, are more within the ASX's gift. There are elements of reporting—for example, we've talked a bit about reporting and assurance today—that we're going to look at to understand, from the principles of listed companies, are there things that we ask for that don't add value which make it harder for them to resist the temptation, for example, to look to be taken private? It's not just about getting companies on the boards; it's getting them to stay on the boards and to see this as a good place for patient growth so we get that growth and productivity. Indeed, we're kicking off that phase. I chair a markets panel, a great group of leaders from all different corners of Australian markets. In the next couple of weeks we'll be opening up that question: this is something we heard about in terms of staying listed. What do you think? Are there one or two things that are within our gift that we should focus on? Secondly, we have been doing work with ASX. We've talked a lot today about ASX's critical infrastructure. In terms of the difference between the panel's interim report and the final report that we've talked about, one of the key findings concerned the compliance, listings and corporate governance function within the ASX as part of the whole of the ASX investment in and refresh. It will be important to see that happen, because that gives them the bandwidth. They've put energy and time into that at ASX, but it's important that they consider their part, what's within their gift, to ensure we have the appropriate settings for disclosure and protection of investors, particularly retail, but also as a very attractive place for listing. Mr Longo talked about the international dynamics. Finally, in terms of the public markets, because I think that was the first part of your question—you might want to come back to private credit—of course, there are the rails, the ASX, the listed market, functioning, being reliable, being resilient and being aspirational. That's one of the reasons we focus so much on the ASX so that for now and for what it looks like in five years, when we're truly going to be even more global, it is aspirational. Ms JARRETT: I do want to go back to the private market, too. Mr Longo, you mentioned that it's roughly $200 billion as a figure. Some of our larger super funds have 20 per cent invested in unlisted assets. That makes me a bit nervous, if there are higher risks associated with the private market. You talked about risks there and the lack of opacity. Could you give a bit more colour to that? Mr Longo : The private markets are a broad church. Private credit is a subset—my word—of the private markets, and a relatively small one. People worry about it because there's a lot of handwringing about whether it's a contagion risk; that if things go wrong in that market, it's going to have broader stability issues for the system. Let's put that to one side. You mentioned superannuation, and I think that really is a profound topic. I understand that between a third and a quarter of the ASX is super. Our superannuation sector is—I think there's no other word for it—extraordinary. It's now hitting $4-plus trillion and they're running out of—my word—investable assets in Australia. They invest in the public markets and they will do what they can to invest in private markets, which includes private equity, alternative investments. There's a whole range of investable ventures—I'm just trying to keep it high level—that are available in Australia. If you have $4-plus trillion to invest, you're going to go offshore. That's what our superannuation funds have done. They have a presence in the US and Europe, and they've been investing offshore for some time. You're right about the statistic, though. I think it's quite interesting in that, certainly for the bigger funds, the private market asset seems to be climbing 20 per cent-plus. I'll ask Simone to comment a bit more on that; she's closer to some of those dynamics. But at the heart of it is the approach of the super funds is global. We can't expect them, in the interests of all Australians, to invest all of that money just in Australia. That's not going to work. The way capital flows work now, they're missing those opportunities. I might ask Simone to comment in a bit more detail. Ms Constant : Just for some further depth on what Mr Longo said, I might start with superannuation investments into direct investments or unlisted investments. As one of your colleagues on the committee knows, as well as me, APRA definitely takes the lead when it comes to valuations and asset allocation around the attribution of the portfolio of APRA regulated super funds. A large proportion of the $4 trillion mentioned are APRA regulated superannuation funds. When we did our work that we released at the end of last year on changing dynamics in public and private markets, we did go on record in saying that, with the regulatory architecture we have and the strength of APRA supervision, plus the strength that ASIC has in key instruments such as our red guides around fees and disclosure that work with things like the performance test, in the main superannuation through APRA regulated superannuation is a good place to get exposure to private markets investments. I will let APRA speak for themselves around 20 per cent versus 30 per cent and how that works with things like liquidity. It does require all of us to be regulating within our remit and paying attention. It does, though, mean that for every Australian—and the chair of the committee opened today with some remarks about how every Australian has superannuation increasingly—private markets are relevant. It's one of the reasons we focus so much on this. You're absolutely right in that, when we think about global reasons for the changing dynamics here versus domestic reasons, superannuation is the leading idiosyncratic factor in shaping the dynamics of Australian markets because of its size. Done well, that's a really good thing. I refer back to private markets generally and your questions on private credit. It's pleasing that you've picked up on our messaging that, within private markets, private credit is one particular area of private markets that we really have focused on. There are a couple of reasons we've focused on it. One is that growth rate. That is a global growth rate, but we are absolutely seeing the same domestic growth rate. In fact, it's probably disproportionate growth versus private equity, the other type of private investment. It doesn't mean it's bad. We always say private credit done well is good for investors, good for the flow of credit and good for the economy. Indeed, it's a necessary correlation to some degree of the way banks are required to price certain risk. That said, there are some Australian factors and some global factors that have our attention. To quote some of the global voices—it's a good statement—'private credit is facing what many are describing as its first real test at scale'. That's both global, but it is also domestic. Paying attention to what's happening globally, global private credit is somewhat different to Australian in its complexion. Australian private credit tends to cluster more, for example, in property, and construction and development, which can be a good or bad thing. That concentration can be good or bad. Some of the challenges globally have been in, for example, software. As software has devalued with the rise of AI, there has been a lot of private credit caught up in that. There are some differences there. That's not to say that Australian institutions are immune from that. There are certainly some institutions participating in that, but there are differences. We need to pay attention to that and to our findings last year. Again, I recommend Report 820, our private credit surveillance report, where we identified some very poor and concerning practices in domestic private credit by looking across 28 funds. There are three or four actions I will outline that we have under way. We have had the first and are about to commence a second surveillance following on from that. We're looking at things like conflicts of interest where there may be transfers, movements and conflicts which can, for example, have problems with valuation. We're then going to be looking at valuations and liquidity. The reason to look at those issues in close focus is that we saw some serious concerns during last year's surveillance. There are also very important things when a market is being tested, which is about what might be going to happen. As to the other thing we're doing right now, we've just concluded an 8- to 10-week survey of about $70-$80 billion worth of funds under management domestically to see what's being observed here. We can see whether it's the same or different. Ms JARRETT: What are some of the key findings? Ms Constant : We're just pulling that together right now and we're looking to release it. We think it's time for us to communicate publicly what did we find, what are we seeing, how does it relate to the previous findings we've had of concern and where are we going? In the next couple of weeks we'll be releasing an article that will lay out those early findings. What we have seen so far is that there is a slow but certain creep in some of our concerns, whether it's underwriting conditions, variability in liquidity across different funds or opacity. If you look at our original surveillance report, we identified that if you look at 10 or 20 private credit funds, many of them will define 'default' really differently. How that's defined can then trigger whether or not we have a clear picture on whether there are default concerns in Australian private credit. We've been trying to tease out some of those concerns as well. To circle back to Mr Longo's remarks, we need to be better informed, if this is going to continue to grow, on what's really happening. Ms JARRETT: To become better informed and to reduce some of that opacity, where do we go with that? Ms Constant : What we find in this article, what we find in these surveillance reports and what we said on the record in November last year about standards, that's what we stand behind. We are working closely with groups like the Financial Services Council, which is really taking a lead for industry in lifting standards. They're quite advanced on those. I expect it's for them to talk to, but I expect they will be releasing something in coming months which will require more consistency in defined terms. Disclosure is one thing, but effective disclosure requires consistency of terms—so 'default' means the same thing—and also a level of transparency around what's held and where. CHAIR: Senator Scarr. Senator SCARR: Can we move on to the Shield Master Fund and the First Guardian Master Fund? To whoever prepared this high-level chronology, thank you very much. There was a lot of work put into that and I found it extraordinarily helpful. CHAIR: For those following along at home, it's Appendix 1 of the submission from ASIC to the committee today, which is a public document. Senator SCARR: It was a very helpful document. I might just follow on from Senator Whiteaker's line of very helpful questioning in relation to that report that was done, Mr Kirkland, in relation to Gen Z investing. One of the concerns I have—and this comes back to something that was mentioned in Mr Longo's opening statement around the enforcement action account—is that you're outgunned. You have all these influencers and spruikers within Australia and overseas promoting all sorts of financial products and opportunities. You're left to try and combat that with the resources you have. It's like that Sean Connery scene in The Untouchables—'You brought a knife to a gunfight?' I hope people understand that allusion! What are your comments in relation to how we can effectively counter that flood of misinformation or disinformation targeting people including young investors? How do we deal with that issue? How can we effectively combat that misinformation and disinformation? Mr Longo : I would agree that it is challenging. To break it down into a few parts, in relation to finfluencers taking action globally is a key part of it. The action that I mentioned with other regulators related to the second global week of action in relation to finfluencers. We're operating with regulators in a number of other jurisdictions, all taking action based on our own regulatory regimes and our own powers. Sending that message that finfluencers may be acting anywhere in the world but we are acting together to try to make sure they comply with the law wherever they are operating is part of the picture. In terms of people more broadly operating online in Australia and encouraging people to make investments, another part of our response is the work that we do involving scams in relation to our work to take down scam investment websites, which I think we've talked about here before. In relation to the conduct that's closer to what has happened with Shield and First Guardian, we've been quite clear about our concern about the actions of what we describe as lead generators. Businesses that often start by advertising on social media, things like free super health checks or super reviews, as a way of luring people into handing over their details so that they can then be hit with phone calls that ultimately convince them to switch their super. In that area, we're obviously taking enforcement action, but we do have a view that there are some regulatory gaps. The government has been consulting recently on a range of proposals, some of which we think will be quite helpful. It's canvassing, for example, whether there should be a ban on direct communications with consumers about super for a commercial benefit, which would be a way of banning some of that lead generation activity. There are also proposals that would require advertisements in relation to super to online advertisements to contain the AFSL of the entity that's advertising. That would be very helpful as well in terms of us being able to work with the digital platforms to get them to take down ads that aren't coming from an appropriately licensed entity. There is a range of other proposals as well, but we do think there is a really good reason to be thinking about whether there are regulatory gaps that could be closed. Senator SCARR: I will refer to some particular points in relation to Shield Master Fund and First Guardian and some concerning articles. I've been following it through the financial media, as I'm sure has everyone, and the information provided by ASIC has helped me dovetail some of those issues with what ASIC is doing. ASIC obviously has a formidable focus in relation to this matter. You go into the detail with respect to that. I really do commend especially the efforts to reach out to people who may have suffered loss to make sure they're making claims as they should be making claims. I think that's really important. In fact, before I go any further, do you have any update with respect to success in that regard? Mr Longo : Yes, since the last time we appeared we've done a lot more. That included quite a lot of media activity last week, in particular, where we— Senator SCARR: Did you enjoy that, Mr Kirkland? Mr Kirkland : It is an interesting question in a way. Senator SCARR: There are some radio stations looking for new announcers! Mr Longo : To the extent it means more people complain and might get compensation, that's very satisfying. It's pretty sad to be having to communicate about that, which is why I do give quite a considered response to the question. To answer your question more directly, as a result of that activity, over 3,000 people have lodged complaints with AFCA, as we understand it. Earlier this year when we really started to intensify our efforts, it was just over 2,000, so we have seen an uptick. We understand that, as a result of that activity last week, there were people ringing AFCA who had not previously realised they had been invested in Shield and First Guardian who are starting that process of making a complaint. We also saw a spike in visits to the Take Your Super Back website, which we funded Super Consumers Australia to provide to assist people to make complaints. Those efforts are having an impact but, obviously, with over 11,000 people affected we still have a way to go. Our work is not done and we just need to continue to be creative in the ways in which we're trying to raise awareness of this, because we suspect there still are many people who don't realise they're affected. We're also trying to make it as easy as possible for them to make a complaint. Senator SCARR: Senators and MPs have a role, too, in terms of our communities trying to bring it to light so that our constituents are bringing claims to AFCA. Ms Court : Senator, if you don't mind, can I just amplify a bit of what Commissioner Kirkland said. We have been very focused on trying to make sure the investors in the Shield and First Guardian Master Funds are aware of the current situation. As we've given evidence before, we have managed to return some $421 million to investors. We may not need 11,000 people to complain to AFCA; a large percentage of them have had their capital returned. The point I was going to make in terms of trying to reach particular investors is that one of the ideas that someone clever in our team had was to do an analysis of the postcodes where the investors reside who have not lodged AFCA complaints. In the radio interviews that Commissioner Kirkland has been doing, it has been very helpful to be able to talk specifically about particular suburbs, for example, where we know investors reside who haven't yet lodged AFCA claims. That has been very helpful. The other thing is that now we are up to our 12th round of direct mail letters and emails to certain categories of these investors as well. There is an enormous amount of work, probably unprecedented work, for us in relation to trying to make direct contact with potentially impacted investors. Senator SCARR: On notice, can you provide those postcodes? Would that be possible? Is it public? Ms Court : Yes, of course. Senator SCARR: Members and senators will be interested to know especially whether or not there are postcodes within their own seats. CHAIR: Hotspots. Senator SCARR: Hotspots, yes. Ms Court : I may be corrected on this, but I am fairly sure that we have written to members and senators about the work that we are doing. I will find out whether or not that information was included for individuals as well. Senator SCARR: I don't remember it being included, but I would be very interested to know. Mr Longo : We can easily provide that information. Senator SCARR: I will engage and reach out myself, especially in terms of local media, putting advertisements in or whatever, to try to reach those people or their family members so they can raise it with their parents or grandparents, because it's critical. I want to talk about InterPrac Financial. I was really concerned to see in an article written by Lucas Baird of the Australian Financial Review that they brought an action against AFCA and have now added to that action one of the victims of this disaster, and that's Melinda Kee. A concern has been raised that this action may delay the authority of AFCA to process claims which are made to it. I will quote what Melinda said in relation to the impact of this action on her being joined. She said actions like the one against her had a 'real human cost on victims' and that 'behind every complaint number is a person already carrying enormous stress and trauma'. She stated further that 'many investors are older Australians who simply do not have the financial or emotional capacity to endure years of litigation'. This is a person who has lost hundreds of thousands of dollars through these scams and the failure of the funds. They have now been joined by an ASX-listed public company to their action against AFCA. I understand that action is against AFCA but, in the context of the web of actions being taken by ASIC, does ASIC have a particular view with respect to that and how the victim can be supported in and the appropriateness of this action? I would like to give you an opportunity to respond. Ms Court : We're aware of the proceedings that InterPrac has taken against AFCA. They've made a number of allegations against AFCA, including that InterPrac failed to have been afforded procedural fairness. We're also aware, obviously, that InterPrac has now joined Ms Kee as a party to the proceeding. Our view is that's a deeply disappointing approach to be taking to one of the many victims of the collapse of these funds. One of our concerns is that should not act as a disincentive for other investors to lodge AFCA complaints. We're concerned that, quite understandably, it might have that impact. We are most concerned, as we were talking about a moment ago, to make sure any potentially affected investor lodges an AFCA complaint and that people are not pulled off filing those complaints as a result of the conduct of InterPrac in taking these actions. We've been recently advised by AFCA that InterPrac has refused or failed to give effect to the AFCA determination that concerned Ms Kee. That now puts within our ballpark perhaps the ability to take some action in relation to that failure to give effect to the determination. That's a reasonably recent event, so we are giving that some thought. We also understand that, as a result of these actions, AFCA has now announced—I think only yesterday—that AFCA is proposing not to make further determinations at present in relation to Shield and First Guardian complaints lodged against InterPrac but will, however, continue to receive and accept those complaints. I think it's important that they still are doing that work. I won't speak for AFCA, but it is doing that really to try to avoid unnecessary complexity and the potential stress for impacted consumers because, clearly, it doesn't want other victims of this to find themselves in the same circumstances as Ms Kee. We are in complete agreement with you that this is a very unfortunate state of events. I know that Commissioner Kirkland and Mr Savundra have engaged with Ms Kee on a few occasions and very much understand the personal impact on her. Senator SCARR: I think it's important that Ms Kee understands that we on this committee, as members and senators—I'll certainly speak for myself—are deeply concerned about the position she's been put in, especially as someone who has been a great advocate for the victims of this financial scandal. I think it's absolutely outrageous. I think the directors and shareholders of InterPrac need to carefully consider their position with respect to this, because I think it's an absolutely appalling state of affairs. Ms Court : There's one other issue I might just put on the record as well—I don't know if you were going to turn to it—in relation to InterPrac. That related to a proposed sale of InterPrac by Sequoia, its head company. It's a listed company. Senator SCARR: For $50,000. Ms Court : Yes, indeed. Again, we were most concerned about that. Firstly, we didn't understand the transaction and the $50,000 but, more importantly, we were concerned that sale might move to deprive victims where we allege—I need to be clear that these are allegations—InterPrac was involved that could potentially defeat those claims. We took immediate action to try to have receivers appointed to InterPrac so we could get to the bottom of the sale and what was going on. As I understand it, at the moment, as a result of that the sale has been paused, for want of a better word. I want to emphasise and make clear how active ASIC is being in relation to this suite of complicated and, I must say, heavily defended matters. Senator SCARR: I commend you in relation to that action that was taken. I would love to see the legal advice and structuring advice that was given to InterPrac with respect to that proposed sale. I won't speculate. CHAIR: The committee will now suspend for one hour, returning at 1.20 pm. I can indicate that ASIC will have a little bit longer, because the committee will have a private meeting to discuss some pressing matters. It shouldn't take too long, and then we will continue as scheduled. Proceedings suspended from 12:19 to 13:47 CHAIR: The committee has resolved to hold, following the committee meeting, a public hearing into the KPMG matters, on 19 June. I also want to, in light of the developments today and in anticipation of continuing inquiry by yourselves and other regulatory bodies and professional bodies and ourselves, put on the record that the evidence from the whistleblower was put into the parliament in the speech that I gave under privilege. That whistleblower has provided evidence to this committee and is a witness before this committee, with all of the protections that offers. These are the words that describe the protection of the witness: there should be no action by any party to intimidate in any way, using any method, the whistleblower, who has provided such important information for the public good and has been vindicated despite two years of attempting to bring this to the attention of a range of entities, including KPMG itself. This is what we say: I remind all witnesses that, in giving evidence to the committee, they are protected by parliamentary privilege. It is unlawful for anyone to threaten or disadvantage a witness on account of evidence given to a committee, and such action may be treated as a contempt by the Senate. It is also a contempt to give false or misleading evidence. With that said, I'm going to table two letters, both the document that was provided to ASIC this morning by KPMG and the document that was provided to the committee. If you will indulge me with just one comment on this letter, I'm appreciative of receiving it. I'm sorry that we didn't receive it before we commenced at 9. I don't think that was very good form. I'm a little concerned by the last part of the letter, which is where it differs from the one that has been received by ASIC. The letter signed by Martin Sheppard, the chair of KPMG, begins to advise the committee on the way in which we should proceed. Can I be very clear: the committee will follow its own processes, and we expect full cooperation in every way with the requests of the committee for both attendance and provision of all documents. Senator SCARR: In that regard, Chair, with indulgence, I just note the powers of the committee to issue subpoenas, and this committee, under your chairing has adopted that practice in the past. CHAIR: Sadly, we have had to, and we will continue in that way in the public good. Thank you very much for your support, Senator Scarr. Senator Whiteaker, you have the call. Senator WHITEAKER: I'm on this same matter just hoping to get a better understanding from you about the time line. I will refer firstly to a letter that was tabled earlier this morning by the Chair from Lendlease, which I understand you have a copy of. Senator O'Neill, the Chair, in March 2026, of course, made her statement to the Senate raising the allegations made by the whistleblower. This letter from Lendlease to the committee, on the first page at the very bottom, point 3, states that, in May 2025, as part of update discussions representatives from KPMG advised various personnel from Lendlease that a whistleblower at KPMG had alleged et cetera. My understanding from your earlier evidence is that ASIC commenced an inquiry following the Chair's statement to the Senate on 24 March—is that correct?—this year? Ms O'Rourke : It was my evidence that went to the dates, and it was a little earlier than that. What I understand from our team is that our inquiries commenced on 14 April. Senator WHITEAKER: 14 April 2026? Ms O'Rourke : Correct. Senator WHITEAKER: At what point was this matter first brought to ASIC's attention? Your investigations commenced in April 2026, but when was ASIC first made aware of these allegations? Ms Court : I think, just looking at the briefing that we've got on the matter, it was following Senator O'Neill's speech to the Senate that raised these allegations. Senator WHITEAKER: But how can that be, if the investigation or the inquiry—sorry—as probably how Ms O'Rourke characterised it, commenced— Ms Court : In April. Senator WHITEAKER: In April? Sorry. So it wasn't earlier? Ms Court : No, that's right. Mr Savundra will jump in if I've got this wrong. I think the dates were that Senator O'Neill delivered her speech on 24 March 2026. That came to ASIC's attention. We then commenced a preliminary investigation into allegations about the conduct of a number of registered company auditors at KPMG, and we commenced those inquiries after meeting with KPMG on 14 April 2026. We then received further anonymised information—as Commissioner O'Rourke gave evidence earlier—in writing from KPMG on 29 April 2026. Senator WHITEAKER: So at no point earlier than Senator O'Neill's statement to the Senate was ASIC aware of these allegations? Mr Savundra : We had contact at a high level from an individual. But in relation to the detail of that, I would prefer to provide that evidence in camera. Senator WHITEAKER: Chair, I might seek your advice on that. Perhaps we can consider it at another time. Proceedings suspended from 13 : 56 to 14 : 21 CHAIR: We will commence with a final question from Senator Whiteaker. Senator WHITEAKER: In the letter that KPMG wrote to the committee earlier today, after the commencement of this hearing, on page 3, part A, 'Detailed statement of facts', it says: 'KPMG will prepare a comprehensive statement of the relevant facts underlying the allegations made by the whistleblower. This will include the new conduct matters we are investigating.' I don't believe that is in the letter that they provided to you, at ASIC, also this morning. Have KPMG at any point raised with you new conduct matters that they are investigating? Ms O'Rourke : We're not sure what that reference to new conduct matters is. As of here and now, we don't think so, but we cannot be sure, I'm sorry. Senator WHITEAKER: In a general sense, if a consulting firm becomes aware of misconduct of this nature, would you expect them to bring those concerns to you as the regulator? Ms O'Rourke : I think we referred earlier to the audit partners, so the registered company auditors as opposed to the whole firm or the consultancy aspect of it, and that statutory requirement to bring to ASIC's attention misconduct. I think Mr Savundra quoted some of the provisions earlier around those categories of information that are required to be reported to us. Senator WHITEAKER: But they have not made a report to you under those provisions? Ms O'Rourke : I think in my earlier evidence I did describe the information—that KPMG has provided some information to us. I refer to the information being provided to us on 14 April and 29 April. So, yes, there has been provision of information— Senator WHITEAKER: But not prior to that April date, certainly? Ms O'Rourke : To the best of my knowledge, no. Senator WHITEAKER: That's it for me. Thank you. Mr BUCHHOLZ: Thank you for appearing today. My couple of questions also go to the correspondence that the senator was referring to—the stuff from KPMG that Senator O'Neill received on 29 May. In light of the revelations this morning and the change of KPMG, can I just bring your attention to page 2 in the first paragraph: 'KPMG has previously reported to professional bodies, regulators and the committee'. It goes on in the second sentence, 'Three partners have previously been sanctioned regarding this matter'. Can I just get a sense of whereabouts your investigations are up to, and are you aware of who the three partners are? Ms O'Rourke : Yes, I think that, to the earlier discussion around those contacts that we had with KPMG earlier, we did have a meeting with KPMG on 14 April around the activities or issues and then received from them further anonymised information on 29 April. I think we gave evidence earlier around that information being anonymised and the fact that we took action to seek the details of the particular people involved under notice. Mr BUCHHOLZ: So you know who they are? Ms O'Rourke : We do know who the three individuals are. Mr BUCHHOLZ: Is it for public knowledge? Ms Court : I think I gave evidence before. I'm sorry, I'm not sure we've got that information in front of us here, and I think I undertook to take that on notice and provide it to the committee. I just haven't got it in front of me, I'm afraid. Mr BUCHHOLZ: That's fine. I'm not trying to go down a rabbit hole. I'm more trying to understand where your investigations are, because in the next sentence it says, 'We continue to investigate the matter.' Can I ask: when KPMG or a body like this does an investigation, do they do that in silos of their own or are you part of that investigation or do you conduct your investigations in parallel? How does the information that they first get, in its integrity—how do you know that goes to you or how do you then come to a similar or an alternative conclusion? Ms Court : It's a very good question, Mr Buchholz, and to some extent it depends. Every one of these matters is slightly different, but I can say in relation to this matter that we're aware that KPMG have told us, as you say, that they're conducting their own investigation and that they have determined to sanction four individuals. Those are the individuals—I don't have the names of them in front of me as we're speaking. Three of those individuals are registered company auditors, and ASIC has jurisdiction in relation to registered company auditors. So we have now commenced our own investigation into those allegations about the conduct of those registered company auditors. KPMG will do their own investigation and, as we were talking about earlier, companies or partnerships in these circumstances often brief external firms to either do that completely or work with them and provide advice in relation to them. We will be doing our own investigation alongside that. We would hope that KPMG will divulge to us in full what they find out as a part of their own investigation so that can feed into the work that we are doing. Then we will make a decision, once we've concluded our work, as to whether there are any formal sanctions or enforcement activity that we might wish to take in relation to those three registered company auditors. Mr BUCHHOLZ: Excellent, because that then helps me understand some of the following questions I had. We also reported a second matter. Will you make a request to KPMG to understand what that second matter is? They flagged that it was an inappropriate remark in a team setting. Ms O'Rourke : Yes, I think that we've got enough information to understand that person, in relation to that conduct, is not a registered company auditor and therefore doesn't come within our regulatory oversight. But, if we get further information that suggests that there is something that connects to the provisions that we administer, that can be considered further. Mr BUCHHOLZ: So that falls outside your scope of investigation, but it would fall within our scope. Ms Court : Yes, indeed. I mean, this committee can choose to investigate what it would like to. The only other thing I should say, Mr Buchholz, is that, as I've said a couple of times, this is all emerging almost in real time as we're sitting here today. Mr BUCHHOLZ: Of course. Ms Court : We will obviously be taking away from this committee the correspondence to the committee, the correspondence to us that we received today as well, and the further broader context and will be working out the various ways in which ASIC may respond. If the committee is reconvening later next month then hopefully we will be in a position to be more articulate on precisely the various forms of action that will be taken. Senator SCARR: You are articulate. Ms Court : Thank you. Senator SCARR: You're just not able to tell us everything you might be able to tell us. You're doing it in an articulate way. Ms Court : Thank you. That's most reassuring to me! I don't feel very articulate on some of these answers. CHAIR: Can I indicate that your offer to assist the committee would be best delivered in a written form in the couple of days before our proposed hearing on Friday 19 June. If we could have something from ASIC in writing by the 17th, that would help us, whatever the status of that might be—whether it's in confidence or, as much as possible, public to allow the proper scrutiny in the public place of these matters, which is our goal at all times, and only in camera where absolutely necessary. Ms Court : We understand. CHAIR: Wonderful, thank you very much. Mr BUCHHOLZ: In that correspondence, could I ask you to not only give consideration of what you are investigating but also, after our conversations now, what you are unable to or what you're not investigating so that the committee doesn't make assumptions that everything is being investigated. And can you highlight to us what falls in and outside your purview, so we get a very clear picture of the culture. Can I take you to the next page under 'Basis of confidentiality': 'KPMG has sought legal advice in conducting the investigations and assessing the results of those investigations, which are ongoing.' Can I ask: do they share that legal advice with you as part of your investigations? Ms Court : As we talked about with the committee earlier, it will obviously be up to KPMG as to the approach it wants to take in this particular matter. But I think it would be fair to say that generally, in our experience, when investigations of this sort are undertaken by external law firms, more often than not they would not be shared with us on the basis of legal professional privilege. And I think that takes us back to the conversation I was having with Senator O'Neil and Senator Scarr earlier. I don't want to put words in KPMG's mouth in relation to this matter, particularly, but our experience is that generally, no, those are not shared with us. CHAIR: Before you jump onto the next thing, can I come to a question on that. A lot of people listening to this who aren't legal professionals and don't interact with this wouldn't ever have seen the sorts of documents that might exist in a communication between either the chairman of the board or the head of audit or whoever was undertaking the actions on behalf of the Office of General Counsel. These are all people who could possibly have a role in discussions around and the creation of a letter to engage a particular law firm to do something. Now, we're talking about Allens being engaged by KPMG. Could you characterise the nature of such letters in a general way? If you were the Office of General Counsel, what directions could be given and how carefully could the directions be constructed by the Office of General Counsel for KPMG, for example, when they were engaging Allens? Ms Court : I think it would be very hard for me to answer that question in a fair way because it would be speculative. I think there are two important points to make, and I'm probably being repetitive. I think the first point is that we absolutely recognise and respect the right of companies to make proper claims of legal professional privilege. Clearly that has a role to play in enabling people to get free, independent, frank and fearless legal advice, and that's very important. I don't want to give any suggestion that we don't respect that right and the importance of that privilege. CHAIR: I think I can say the committee absolutely accords with that view as well. Ms Court : Thank you. The second point is the one that we've talked about already today and we've talked about in this committee previously. That is, in our experience, there are claims of legal professional privilege that are made in a very sweeping way, often over a range of materials, where we think it is arguable whether or not the full extent of documents can properly have a privilege claim. Those claims are extremely resource intensive to challenge. Ultimately, it's up to a court. If ASIC challenges a privilege claim, it's up to a court to make a determination about the documents in question, but that is a protracted and expensive process. And we have got a practice in ASIC where we try to protect the privileged nature of claims but enable firms to provide documents to ASIC under what's called a voluntary disclosure agreement. The reason that we do that is that we think it's a far more efficient and effective way for us to get to the bottom of something very quickly, and that is designed to get the information that ASIC needs to progress an investigation while at the same time protecting the privileged clients of the firm involved. So we will see where this matter ends up. CHAIR: Can I go to the more prosaic reality of a letter, though—engaging. Most people know, through their experience of driving cars, about an engagement with a mechanic. They might not know a lot about what's going on with their car, but they go to the mechanic and they ask them to look under the bonnet. If we draw an analogy there, we think we've got a problem and we'd like you to look under the bonnet here in KPMG. If you want to find the problem, you say: 'Go and have a look at everything. Find out why that constant noise is going on in the background. I want you to really find out what's happening. Just go everywhere. I give you permission fully to investigate everything.' Or, perhaps, if I don't want to find out what's going on with the car, could I say, 'I want you to look everywhere in the car, but don't look under the bonnet. Examine the wheels, kick the tyres, have a look around the outside, but do not ask any questions of person A, B, C, or D.' Is it possible for such a letter to be written? Ms Court : Speaking completely hypothetically and not about these particular issues, of course, that's quite right. A letter of instructions or engagement to a law firm can put parameters in any way that the instructing firm wishes to. CHAIR: Thank you very much. Back to you, Mr Buchholz. Mr BUCHHOLZ: Are you able to advise this committee at some stage in the future—you just said that you can ask for information to be given voluntarily. When you ask KPMG to voluntarily offer their legal advice, can you come back to the committee and just advise whether or not that was offered voluntarily or the request was denied? Ms Court : Yes, we can advise the committee of that. Mr BUCHHOLZ: That would be helpful. And our investigations are ongoing, including a separate incident. Now, on that separate incident, are you aware of that, and does that issue differ from the question that the senator asked you about—a new conduct matter—in her last line of questioning? Ms Court : You might have to take me to the letter. Mr BUCHHOLZ: Sure. It's on the third page, under 'The basis for confidentiality'. I think it's probably the third paragraph. Ms Court : The separate incident? Mr BUCHHOLZ: Yes. There's a reference to a separate incident and then, down in part A, there's a new conduct. Are they one and the same or are they separate from each other? Ms Court : Yes, I understand the question. I can't answer that. Mr BUCHHOLZ: Can you take that on notice. Ms Court : Yes, will do. Mr BUCHHOLZ: Thanks. Ms JARRETT: I want to understand the scope of the whistleblower legislation. We've been talking a lot about KPMG and the allegations that the whistleblowers put forward. But I understand from the Lendlease letter that was tabled today that representatives from KPMG, their auditor, advised various personnel from Lendlease that a whistleblower at KPMG had alleged that KPMG had used material from Lendlease board papers, in tendering for other audits, which was of a physical nature. Under the laws now that you oversee, is there a requirement on Lendlease to report to ASIC? Ms Court : I think we're looking at each other quizzically, which suggests it's a good question that you've asked. I think we think not, but we'd like to take it on notice to be sure of that. Ms JARRETT: That would be great. And, in considering that, it was May 2025 that Lendlease had mentioned in their letter that they had that discussion with KPMG, which was a year prior to— Ms Court : Yes, thank you. CHAIR: KPMG advised you of that? Mr Savundra : We will double-check, but I don't believe so. CHAIR: What requirements on KPMG are there to advise you? Mr Savundra : I don't believe there are any requirements on KPMG, although we would have an expectation—where people see misconduct, we encourage them and expect them to report it to us. CHAIR: But there's no consequence if they don't? Mr Savundra : I'd like to just double-check that, but I don't believe so. CHAIR: And, if that is the case, and it looks like it may well be the case, is that a critical point of vulnerability of the current system? I'm sorry, Ms Jarrett. Ms JARRETT: No, that's absolutely fine. That's exactly what I was going to ask. CHAIR: Mr Savundra, can you answer and then we'll go back to you for a question, Ms Jarrett. Would it make the system stronger if there was no responsibility—they're not even a third party; they're an active participant, unfortunately for them, or an active victim—to put forward to you as a regulator that something untoward has potentially or allegedly occurred? Mr Savundra : At a general level, I think the answer is yes, but the complexity comes in relation to ASIC's jurisdiction, really. So— Ms JARRETT: And that's the question. Mr Savundra : There could be broad concerns within any professional service firm. Again, you need to look at that intersection between what the concern is and ASIC's jurisdiction. As Commissioner O'Rourke mentioned earlier, some of the concerns that are being looked at by KPMG fall outside of our jurisdiction. Ms Court : It might also be worth noting for the committee's interest, given the nature of the discussion, that Treasury, as I understand it, is in the process of conducting a review of the operation of the whistleblower provision. That was required in the Corporations Act. It may be that some of these issues could be properly brought up in the context of that review that Treasury is doing. Then the only other thing that's just worth drawing the committee's attention to is that ASIC has done a lot of work engaging with companies across the economy in relation to the importance of whistleblower protection. We issued a media release last year calling on Australian companies to adopt better practices to protect whistleblowers. In December last year, we released a report setting out insights from a whistleblower questionnaire that we had done earlier in the year, where we asked questions of a whole range of companies and what their whistleblower policies and practices were. There's quite a lot of information that we've already put out based on our survey and surveillance of what's happening out in the corporate world in relation to whistleblower protections that we could provide to you in due course. CHAIR: I've just got one further line of questioning on whistleblowers, and then we'll be able to move on to further fields. Can I just indicate that, when the whistleblower, frustrated at every point that they tried to blow the whistle on the behaviours that are now a matter of public record, came to my office, I was just impressed by the integrity and the personal strength and courage that was manifest in the conversations that went on to get to the point where there was sufficient trust for information to come into my purview and care. Let me say that, from the conversations that preceded the delivery of material that was provided to me and then to this committee, it was pretty obvious this was a serious whistleblower. I think Senator Scarr has already indicated that was our absolute first response, and that is not always the case when we have people put material before us. Senator SCARR: We get material from a lot of different people. CHAIR: Yes, we do—of very varied types. But this was, in my view, immediately—just as a commonsense response, this is somebody who's blowing the whistle on some very egregious behaviours and who clearly suffered a bit. Today, we have in the statement from the chairman of KPMG, for the first time in writing, a statement that says, 'I want to take this opportunity through the committee to apologise unreservedly to the whistleblower'. To the best of my knowledge, I do believe there was an article in which Mr Tadros directly quoted KPMG, where they had conveyed to him that the whistleblower was a whistleblower, but that was still not asserted in any written form by KPMG. But, in today's letter, this is the first time that they declare the person a whistleblower. Does that in any way impact your assessment of the whistleblower as eligible for whistleblower status or not—that it's now declared by KPMG that the person is now declared as a whistleblower? Ms Court : I think the answer has to remain as Mr Savundra outlined before. The question as to whether or not this potential whistleblower is a whistleblower is a question of law, and I'm not sure that the fact that KPMG identifies them as such changes that. I think the important thing is, as we've talked about before, that we do everything that we can to facilitate the provision of information and to keep that person— Senator SCARR: Can I just tease this out, Chair. I'm putting a legal hat on. A person can be a whistleblower generally and be generally regarded as a whistleblower, including by KPMG. It's a different question as to whether or not they fit within that cohort of whistleblowers who have the particular protection of the provisions of the Corporations Law. That's a different question. Is that an adequate— Ms Court : It's a far better answer, Senator Scarr. It's what I intended to say. That's quite right. There are two different ways to look at what a whistleblower is. CHAIR: This question of status and eligibility to claim status and where that intersects with declarations of speak-up culture, et cetera, is a very live matter that really deserves some of the best and brightest minds to resolve it in a way that leads to better outcomes in the public place and better mental health outcomes for people who do have information to share in the public interest; and to provide that in a way that is safe for them to do so. Mr Longo, in your view, why are whistleblowers so important to the proper and ethical function of the Australian economy in general? Why does the Corporations Act have specific laws regarding whistleblowers, and do you have a great interest in the proper treatment of whistleblowers by Australian firms as a cultural practice at ASIC? Mr Longo : I think the answer to that question is yes on all counts. I think one of the challenges for any regulator is to have access to data or information that leads to action being taken arising out of wrongdoing. History tells us that, from time to time, whistleblowers can make an enormous difference in unearthing issues or concerns that, but for the whistleblowing, would never come to the attention of the authorities. I think Senator Scarr makes an excellent point. We use the word 'whistleblower' in popular parlance in a popular way, but, when it comes to protections, they are clearly legal questions. Whether someone's deemed a whistleblower or not for that purpose is another matter altogether. We've been spending a lot more time and resources making sure that we're in a good position to accept and to assess potential whistleblower information and intelligence. I think we've made some good progress there, but it's clearly an important part of the system. CHAIR: I appreciate that is the case, Mr Longo. In the long time that I've been a member of and chairing this committee, I've asked questions on behalf of whistleblowers many times. I do know there's been cultural change under your leadership, and I appreciate that. Clearly there's a little further to go, but I'm sure Ms Court's up for the next phase of the task. Ms Court : Indeed. CHAIR: In general then—and it could be you, Ms Court, or whoever wishes to answer this question—how do most firms handle whistleblowers, and does ASIC expect each corporation to have robust policies and direct lines of reporting about whistleblowers? Ms Court : As I mentioned a moment ago, we have a number of publications that are available to companies about what is expected and required of companies. We've also done, as I mentioned a moment ago, a number of surveillances in relation to particular companies, and we've identified good practices and we've identified problematic practices. There is a range of obligations on particular companies under the act to have whistleblower policies and procedures and, as I say, we do do surveillance of those on a regular basis. CHAIR: Thank you very much. Mr Longo, I've just indicated that KPMG confirms that its treatment of whistleblower investigations into the allegations fell short of the firm's expectations and those of the whistleblower and the broader community. Do you have a view about what's on the public record with regard to the whistleblower at this point in time and KPMG's interaction with them? Mr Longo : I mean, it's too early for me to express public views about where this is at. As incoming chair, Ms Court, noted a moment ago, it's a fast-moving situation. It's quite remarkable to see a KPMG CEO resign today and I think the internal head of audit as well. These are quite remarkable developments, and there's clearly something very serious going on that has led to such resignations. I think at this point all I can really say is that the commission, as you can see from the evidence that Deputy Chair Court, Mr Savundra and Ms O'Rourke have given, this is getting a lot of attention at ASIC, but it's a fast-moving situation from our perspective. CHAIR: I think we'd probably all be able to agree, based on what's already public, that there's been a severe mismanagement of the whistleblower process. Is that a fair assessment at this stage? Mr Longo : Well, I think given the way things have unfolded, observers are entitled to feel some 'What's going on here?' sort of feeling, particularly in circumstances where there have been a couple of reviews by law firms. It threatens a bit of confidence. While you've known about this for a while, you've done some reviews, but you don't seem to have got to the bottom of it—I think that seems to be the collective feeling. But, as I've indicated, it's now firmly in the sights of this committee and firmly in the sights of ASIC, and we're going to need some time to get to the bottom of what happened here and whether the—how can I put it—initial reaction or response by KPMG management to what was brought to their attention was adequate. And we're not going to know that until all this additional work's done. CHAIR: I think there's an admission in here that the process wasn't handled particularly well. Senator SCARR: That's an understatement, Chair. CHAIR: I'm not known for that. Now, with new evidence and expanded scope, Allens are continuing to challenge the conclusions reached in prior investigations, which is what is revealed today. What does that mean from your perspective, Mr Longo? Mr Longo : Well, at this stage, I really can't usefully add to what I've already said, Chair. There are clearly a lot of unanswered questions, and we're all keen to get answers. I note that this committee will be reconvening in a few weeks' time, and hopefully that will give us the time we need to make further inquiries. Hopefully next time around we'll be more expansive as to what's happened here. CHAIR: Thank you. I appreciate that. If we go to the media release KPMG put out 29 May, which basically accords with the letters—I'll just hand those out. They clearly find deep governance and cultural issues within and confirm they've engaged Principia Advisory, a leading global specialist in ethical culture, to undertake an external review of the underlying speak-up culture, including the policies and processes that support this. What is the link between a firm's speak-up culture and its handling of whistleblowers, to your understanding, Mr Longo? Mr Longo : Sorry, could you repeat that question? They just handed me the paper, and I was distracted. CHAIR: Yes, they state that—you've got it in the letter and then it's also in that release. Mr Longo : Yes, I've got it right in front of me. CHAIR: In the letter, it's a paragraph on page 2. It's the fourth from the bottom: 'In addition to the external'—'Allens, which will thoroughly investigate allegations, we've also engaged Principia Advisory, a leading global specialist in ethical culture, to undertake an external review of our underlying speak-up culture, including the policies and processes that support this.' My question is: what's the link between what's called the 'speak-up culture' there and whistleblowing? Mr Longo : Well, what I take from this is that, in addition to what I would call a more conventional internal investigation, this time led by Allens, there's going to be a broader piece of work, I gather, by Principia that's looking at the culture as a whole and seeing whether there's something about the way that they operate. I really can't do more than what's in the document. I think it's an understandable piece of work that they'd want to be doing, because the law firm's inquiry is really quite narrow, when you think about it. It's 'What happened here?' I suspect the other piece of work is much broader and saying, 'How do we avoid this happening again?' But, as I really want to stress, I really can't add more than what they've already said publicly. I don't know whether the commissioner or— Ms O'Rourke : I want to add that when we did the work reviewing how— CHAIR: Sorry; can I just get your volume up a little bit because I can't quite hear you. Ms O'Rourke : Sorry, forgive me. I think Deputy Chair Court referred to the work we've been doing—surveillance work in relation to the way companies have been meeting their obligations to have, for example, whistleblower program reporting processes internally. Those requirements apply under the Corporations Act. So we go back to that question of whether or not they apply to firms that aren't in the Corporations Act. Nonetheless, our understanding is that some of them use the phrase 'speak up' like that's a term that's used to describe programs that are, in effect, complying with those statutory requirements to have effective policies by which people can whistleblow. CHAIR: Whistleblowing is fundamental and important in every part of every corporation. It's a big job. You want to get somebody who knows how to do it right. There are many companies, it seems, that think KPMG or maybe thought KPMG knew how to do it right. Frankly, I would assert that the evidence we have at this point in time shows, and I expect will continue to show, that the speak-up culture was a failure and the whistleblower was in a very precarious position. Nonetheless, can I draw your attention to a document that should come to you now, and it is the National Australia Bank whistleblower protection policy of April 2026. Can I ask for that to be distributed, please. I'll just keep the time line. I think I made my speech on 24 March. There are inquiries underway. ASIC is triggered to review its files and figure out what's been going on with a whistleblower. There's correspondence to this committee about the denial of any responsibility and assertions that the whistleblower has been treated perfectly, with kid gloves. Yet the reality that's emerging is something quite different from the telling of the supposed facts asserted by KPMG. If you have a look at this whistleblower protection policy of April 2026, according to page 2 of this, if I can take you to that—this is the document dealing with the 'speak-up culture', the same language as Mr Yates used when he was giving evidence to this committee with regard to how much better they were than PwC, as I recall—it says, for the NAB Bank's whistleblower protection policy, 'You can report concerns about wrongdoing to the Whistleblower Program by contacting the KPMG FairCall service.' And there's that word again: 'an independently monitored external hotline and reporting service'. Have you heard of KPMG's FairCall services? Ms O'Rourke : I don't think any of us at the table have. Whether other ASIC staff may have: not that we're aware of. CHAIR: Can I draw your attention to the chart on page 2. Australia—there's a phone number there and there's an email: faircallnab@—completely associated with—kpmg.com.au. They assert in this document that, for those who use this service through NAB, 'Your identity will be kept strictly confidential and will be only shared if you consent or if the disclosure is to an authorised recipient under law'—that is ASIC and APRA, so you get a mention in there. 'You can be anonymous if you prefer.' Were you aware that KPMG manages whistleblower reporting for significant firms in Australia for the Australian economy, including one of our biggest banks? Ms O'Rourke : No, we were not aware. No one at this table is aware of that. CHAIR: I am aware that not just the National Australia Bank but also some of the most significant firms in this country seem to be using this service, which gives me cause for concern. Could I ask you to investigate all of the entities that are using this service by KPMG; who is triaged to FairCall KPMG whistleblowing services; and what companies are involved? I can say a little bit of digging so far has revealed that the RBA and the ASX actually avail themselves of this whistleblower service, which just blows my mind. I don't know how long they've been providing that service, but the fact that the policy approval date is 26 April for NAB just makes me question everything about the authenticity of the mea culpa that is embedded in the document provided to both ASIC and this committee today. Ms Court : We can certainly make inquiries. CHAIR: I think I might leave it there. I'm pretty sure that I don't need to ask you if you're concerned. Ms Court : We're very interested. Senator SCARR: I have just one follow-up question. CHAIR: Yes, then we'll go to Ms Lawrence. Senator SCARR: It does raise an issue with respect to—I don't know what the commercial arrangements are between NAB and KPMG, I don't know what other services KPMG may provide NAB, I don't know what the history is, et cetera. We talk about the independence of auditors. It does raise a question around the independence of the providers of whistleblowing services. And I know, based on pre-parliamentary experience, there are a number of service providers of whistleblower services. Quite often, you need them to be multi-jurisdictional if you've got operations around the world. But it does raise a question as to the prudential probity requirements with respect to the providers of those services, in my mind, and as to whether or not relationships between the provider of the services and the company that's engaged them in any way do potentially compromise their independence and their being seen to be independent. Is that something which ASIC has ever reflected on? Ms O'Rourke : If we have additional information, we'd be pleased to share it on notice. I think in our review of—I referred to the fact that, in the way different companies have different arrangements for discharging their responsibilities in relation to whistleblowers, there is variety. Some people do it in-house and have their own arrangements. Others, to your observation, do ask others—in this case, clearly—to administer their program for them. I think our answer has been that we've noticed that's varied. But, as to that question of whether it is outsourced and there needs to be some independence or not, I'm not sure that's something we've turned our minds to, nor am I aware of any requirements to that end. Senator SCARR: Thank you. CHAIR: It just raises all sorts of questions. If you're entrusted with getting critical information about one of the big four banks, and we've seen the culture in the aired allegations about the free sharing of information, I just wonder how much critical information about—well, NAB is a pretty new contract, so there might not be that much there. But, if they've been with other major entities in the Australian financial sector, how much insider information—a version of insider trading that's not about money and the stock market—enables further business opportunities to be spotted and chased for the pursuit of profit? I have all sorts of questions around that and, again, it just reveals how critically we rely on ethical professional behaviour and perhaps how unobserved some of the opportunities for, to use Mr Kirkland's term, scamming are. We think about it in a very different way, but we don't think that the big entities that are supposed to be doing the auditing are practising potential scamming inside large Australian companies like Lendlease. It's truly shocking to me. I'm going to go now to Ms Lawrence. Ms LAWRENCE: I appreciate some of these questions you might have addressed in some theme already this morning. But, just for my purpose, I wanted to get a little bit more clarity because today we've heard some really significant announcements around these resignations. From my view, they can't become the mechanism by which firms are containing their liability while avoiding deeper scrutiny. I'm just seeking what assurance you can give the committee that the resignation of senior executives will not narrow the scope of your regulatory scrutiny. Ms O'Rourke : Earlier, we did describe the scope of our investigations in light of the information we've received to date and noted that we are making further inquiries and are still gathering information. Our investigation is aimed at understanding whether there were any breaches of the duties of the registered company auditors who were, we understand, involved in the conduct that's been described. And that's not the CEO or the head of audit; they are different individuals. It is a separate inquiry to that outcome that you've referred to, and that doesn't affect our investigation of those or our understanding of what has happened in relation to those people. Ms LAWRENCE: Given now these allegations have entered the public domain, can I just confirm: had you commenced any inquiries prior to this information being public or any proactive surveillance before KPMG's approach to ASIC? Ms O'Rourke : We did describe in earlier evidence the dates on which we had received information and commenced our inquiries. That preliminary investigation did start on 14 April after we had a meeting with KPMG—I hope that's of assistance. Ms LAWRENCE: And was that then still just ASIC monitoring KPMG or did an investigation commence? Ms O'Rourke : Yes, we commenced a preliminary investigation on 14 April 2026. Ms LAWRENCE: Where KPMG has indicated that they'd undertaken a number of internal investigations, do you see that there needs to be any reform in that process where they're undertaking those investigations in anticipation of regulatory scrutiny? Ms Court : We talked about this a little before you joined us today. One of the issues that we've talked about in this committee in the past is the nature or the role of ASIC's oversight in relation to these big accounting partnerships. Our role is in relation to these specific registered company auditor individuals as opposed to the firm overall. That's the legal position or the legalistic answer. The broader answer is that we certainly engage with these firms on a regular basis, and we would expect them to let us know when issues like this arise. In terms of when we first became aware of these issues, we gave all the information that we could give about when these matters first came to our attention. Ms LAWRENCE: I appreciate it's a live matter, but are you able to advise whether you're now taking action to ensure relevant evidence is not altered, destroyed or withheld following these resignations? Ms Court : As Commissioner O'Rourke noted, we have an investigation underway, and all of our normal investigation procedures therefore apply. We would certainly not be anticipating any alteration of evidence or documents or anything like that, clearly. That would be well understood by KPMG and those involved. CHAIR: What protections do you have to make sure that doesn't occur? Ms Court : There are all sorts of ways that ASIC can obtain information from a range of parties that may be involved. Ms LAWRENCE: How can you assure the committee, too, that institutional accountability remains under consideration? What can you speak to there to give us that assurance that it's not just about any individuals; it's about the broader institutional accountability that we want to uphold? Ms Court : I understand that and very much understand the committee's interest in this. One of the other things that we have observed over the course of the day is that, to some extent, these matters have been brought to our attention and are arising in the course of the day. We have undertaken to take the various issues away, including what the information ASIC already has available to it and the new information that's just come to light, really, in the course of the hearing today. We've undertaken to provide as much information as we can to the committee before the committee convenes on 19 June to look at those issues more broadly. There's a range of different lenses through which we can look at this, but I'm just a bit loath to speculate too much on where ASIC's jurisdiction lies. I very much understand, obviously, the committee's interest, and we're obviously very interested as well in the information that's been provided to us today. Ms LAWRENCE: I know there was some discussion earlier around legal professional privilege. Can you explain what mechanisms are available to ASIC just to challenge or test some of those privilege claims where there could be institutional misconduct being alleged? Ms Court : Where a claim of legal professional privilege is made then it is open to ASIC to contest that. We would be very much encouraging KPMG to provide information to us on a voluntary basis because that is clearly the most efficient and resource-efficient way for ASIC to get to the bottom of the facts here. But, ultimately, if we feel that there are legal professional privilege claims that are being made that are too broad or that are not properly based on the provision of legal advice, we can go to the court and ask a judge to look at the documents and for the judge to make a determination as to whether or not a claim for privilege is validly made. One of the challenges with that for us, though, of course, is that inevitably takes a long time and is resource intensive. Ms LAWRENCE: The opening line of questioning that the chair had was around this large partnership model and the joint and several liability. I know in previous hearings we have tried to unpack that a bit. In the context of this matter, does this large partnership model effectively avoid any real responsibility on the part of partners? Is that an issue we need to be focused on at all, in your perspective? Ms Court : We have talked about these issues, as you say, in this committee previously. I recall it was when we had extensive discussions about PwC at the time. In our view—and I think we've put this on the record and talked to the committee about it before—we do think there is a gap in the regulatory oversight of large partnership models. We have jurisdiction in a very limited or confined area. When I say 'limited jurisdiction', I mean we don't have any legal powers to make orders or to issue notices and the like to take sanctions in relation to large partnerships. We engage with them, we use moral suasion, we put out reports about our findings, we have meetings with them and we encourage them to disclose information to us. But, ultimately, in terms of enforcement actions and outcomes and the imposition of pecuniary penalties, for example, as a result of contravening provisions of the Corporations Act, subject to the issues relating to registered company auditor individuals, we do not have that broader jurisdiction. I think there are some state-based laws that apply to partnerships, but they're not ones that ASIC, obviously, can administer. Ms LAWRENCE: So would a body like the NACC have reach in this respect? Ms Court : I don't believe so because I understand the NACC is limited to Commonwealth entities. Mr Savundra : Yes, I think it would only extend to a professional services firm in their capacity as a contractor to the Commonwealth. If they're involved in the work of a Commonwealth agency, to that extent, there's a connection, but it'd have to be in respect of an engagement or contract. The conduct would have to be in respect of a contract or an engagement for the Commonwealth. Ms Court : There may, of course, be broader criminal laws, depending on the nature of the conduct, that may apply. I think I recall that. in the PwC matter, that was ultimately referred to the AFP for investigation. It's not the case that there are no sanctions available across all laws. It's just that it's not within the Corporations Act, which ASIC administers. Ms LAWRENCE: I think that's probably a matter I would be interested to pursue some further lines of inquiry on, but I appreciate my time is probably up for now, so I will hand back to you. CHAIR: Thank you very much, Ms Lawrence. I think there's one final question from Ms Jarrett on these matters. Ms JARRETT: Are you undertaking investigations into the other of the big four for similar behaviour? Ms Court : I might have to take that on notice. Ms JARRETT: Thank you. CHAIR: Can you assist, Mr Savundra or Ms O'Rourke? Ms Court : Ms Jarrett, the only thing that comes to mind—and we talked earlier in relation to CTM and the audits of CTM, in response to some questions by— Ms JARRETT: By PwC. Ms Court : Yes, PwC. We're certainly making inquiries in relation to those audits. It won't surprise the committee to know. It's a different kind of conduct. Obviously, it's really looking at the audit conduct, unlike some of the KPMG allegations that the whistleblower has made or that have been reported. But we are looking at those issues in relation to PwC. CHAIR: Just to assist the committee, could I ask: do you have any jurisdiction or oversight of independent company directors? Ms Court : Of company directors? Yes. CHAIR: Whether they're independent or paid? Ms Court : All company directors are subject to the Corporations Act provisions on directors' duties. CHAIR: On notice, could you provide us with an indication of the kind of actions you might expect if a whistleblower approached independent directors, which we know is the case with this whistleblower. It's a matter of public record that that was undertaken. What is the responsibility incumbent upon those directors then in terms of notifications— Ms O'Rourke : We'd be happy to take that on notice. CHAIR: and anything else with regard to how that works. This is for the committee to understand. The other thing is we've had a couple of occasions where you've made it very, very clear that there's an external audit, and today you've further reinforced that it's company director auditors that you oversee. Ms Court : Registered company auditors. CHAIR: Sorry, I couldn't find the word—registered company auditors that you oversee. There is the whole other world that we haven't gone near today, but I think it's part of this ecosystem and it might have something to do with what's happening, and that is the internal audit. Could you make it very clear to the committee where responsibility for internal audit lies, and whether there's any distinction between the responsibilities of internal auditors and external auditors. This is for us to make sure we understand the role and scope and— Ms O'Rourke : I'd be happy to include that. CHAIR: reporting lines and responsibilities in that ecosystem—not just as professional observers at a general level, but in the structural, operational way in which that sector is observed as well. That would be helpful. Thank you very much. The most patient man in the world of the day, Mr David Moncrieff, you have the call. Mr MONCRIEFF: Thank you for appearing today. I just wanted to follow-up on a line of questioning from Senator Scarr, a few hours ago, around the CHESS system. I think the last time, or in one of the recent meetings, we did discuss the capital charge, which you did bring up this morning as well. It's good to hear that there's been progress on that CHESS process, but have you looked at how effective that capital charge has been, and is there a process for looking at whether that process has been successful in achieving its desired outcomes? Mr Longo : It's too early to say whether it will deliver the benefits in a timely manner, but it's a critical part of our strategy to incentivise ASX to make the investments required, because, until those happens, the capital charge will remain in effect. I think I mentioned this morning the impact on dividends for shareholders. Until the investments and the improvements that we've been looking for are achieved, that capital charge will remain in effect. Perhaps Commissioner Constant can give a more detailed response. Ms Constant : I think the first part relates to CHESS and the CHESS replacement program. It's worth noting that, towards the end of April this year, release 1 successfully went live. ASX is now focused on release 2. CHESS is a really important part of the refresh and transformation of their technology, and the capital's attached and associated with that. To give some detail on the capital charge, at the moment, I can confirm ASX is accumulating an additional $150 million above their net tangible asset value. For that net tangible asset value, the end of last year, 2025, is the baseline. It will be accumulated in full by 30 June next year—so that's the end of the financial year next year, and that's part of their commitments package. It attaches to much more, in a way, than just CHESS, but CHESS is a really critical part. It will attach to our satisfaction of the delivery of items associated with the commitments, including the Accelerate plan. The Accelerate plan and the associated technology strategy are really the key interfaces with CHESS release 1, release 2 and all that needs to happen to position ASX as critical national infrastructure. Around your question about the effectiveness of their capital charge, Chair Longo is absolutely right to state his words, 'We're at the beginning of the beginning.' Nevertheless, one of the root causes identified by the panel was shareholder primacy and that there needs to be consideration by the board of the balance of interests related to critical national infrastructure, not just the return to shareholders. When we think about the technology transformation that's needed, that Australia needs from the ASX, that's not just about technological resilience; it's about balance-sheet resilience and capital management associated with providing for all that is ahead, as well as giving that sense of balance-sheet resilience to support technology resilience and operational resilience. It seems to be a very appropriate, well-matched and well-crafted tool and response to match that root cause. It will also deal with this transformation period that we have ahead. This includes the ability of ASIC, as the regulator, to approve the release, at the right point, when those range of commitments have been met that do embed that aspiration, resilience and stability. Finally, I would say, with respect to the ASX itself who have accepted and almost welcomed the report—I think they've used the word 'welcome'. From ASX's perspective—and this may be familiar to you—whilst a capital charge is an impost, it is a message to shareholders, and it does require a level of capital to be kept aside for reinvestment. It's a proxy for risk drawdown. It also allows ASIC to agree to these commitments and the plan. Chair Longo said we now have the roadmap. We will then leave the company, to some degree, to deal with those issues. Of course, we will continually engage. We're engaging all the time with ASX and holding them to account, but it does give them the space to say, 'Okay, this is the plan. We'll now deliver according to that.' We will then seek the incremental release, or release, of the capital charge. For what's ahead for ASX and their need to stabilise, transform, refresh and then be aspirational on critical national infrastructure, it would seem, at this point—whilst it's the beginning of the beginning, it's a very appropriately crafted tool. At ASIC, we're thinking deeply about how that can be employed and can be potentially thought about in other operational risk and remediation and frontline supervision challenges. Mr MONCRIEFF: When you say, 'for those challenges', would that solely be for the ASX or would that be for other entities regulated by you? Ms Constant : At this stage, we're thinking about the ASX with respect to those responsibilities. We're also remaining open minded that, as we move into this new period right now, it's not just capital markets that are so fundamentally changing; it is, of course, technology. It is, of course, technology and the relationship of capital investment into that. We remain open minded, particularly where we have frontline supervision responsibilities. You'll be unsurprised, again, to hear we're thinking about how we look to the success of standards of APRA. For example, there is CPS 230. There's the relationship between CPS 230 'operational resilience' while also ensuring balance-sheet resilience and capital resilience to support that. This thinking could be applied more generally depending on what challenges arise. Mr MONCRIEFF: Similar to that, in relation to that relationship with APRA, you talked in your submission around regulatory simplification. There's RegistryConnect being streamlined over the next six months, and the focus for 2027 is digital services for company registrations, if that's correct. Do you think that's an ambitious target for regulatory simplification? Mr Longo : Commissioner O'Rourke does a lot of work in that area. She can answer that question. Ms O'Rourke : We've done a lot of work in regulatory simplification that ranges across many different areas. We certainly don't have the registry uplift that you described as the sole goal in relation to regulatory simplification. We published, in the last couple of weeks, a report on the wide range of simplification initiatives that we've undertaken—where we've got to so far—but we've also had a forward-looking piece as well about what's happening in 2026 and 2027. Having said that, we think the registry part is an important part of those initiatives, because when we did the engagement that formed the basis of our simplification work we heard loud and clear that engaging with us, transacting with us, giving us information, getting information with us could be improved and was very important. It's a day-to-day activity for a lot of Australian businesses and companies and for people using our data, whether it be for KYC or ML or for making credit decisions or otherwise. The registers are used daily—every second, every minute, every day—so, having programs to try to improve how they function made clear to us how important that is. So yes, we've got a focus on registry. And, to your point, at the moment we're focused on search, so the work we're doing is searching the registers, but subject to a bill being passed, which you'll be familiar with, that allows us to continue the work, including linking director IDs to companies. Our focus from 1 July 2027 will be that step around company registration and lodgement that you referred to. Mr MONCRIEFF: I'll have a look at that report. Is there anything else you would be looking to work on in this space that you won't require legislative change for? Ms O'Rourke : Yes. If your question is in relation to simplification, overwhelmingly the work that we've either started or propose to do is work we don't need legislation for. We started with things we can do ourselves—web content, regulatory guidance, legislative instruments, road maps—all sorts of things that we've identified that we can do to improve addressing complexity and achieving simplification. Overwhelmingly, no legislation is required for that. In relation to the registry, some of the activities under RegistryConnect do not need legislative change. Some of the actions in terms of the technology or improving lodgement and indeed registration don't need legislative change. But for the uplift that we plan, including that linking of director IDs, we need the legislation. The legislation is also important because unfortunately the act has an auto-commencement provision embedded in it from when the Modernising Business Registers program was live. On 1 July this year, responsibilities for the registers auto-commence; they go across to the ATO until that's switched off. That's kind of a mechanical thing that needs to be addressed. The bill otherwise assists us with powers to link director IDs to companies and allows us to take steps to improve authentication integrity and performance and user experience. So we're really looking forward to the Senate's consideration of that bill, and if ASIC can assist with any questions we'd be pleased to do so, to resolve any issues. Mr MONCRIEFF: In keeping with the theme of the different regulatory bodies, you talked in your submission about your work with the ACCC and the NASC around scam prevention. I think it's 185 websites you're removing every week. I wonder if you could discuss a little bit how that cooperation is going and whether it works well, having all these different entities, different regulators, all dealing with the same task. Ms Court : I can answer that. I've been very involved in the scams work we've been doing with the ACCC and the NASC. I think when, back in 2022, the government set up the National Anti-Scam Centre it really marked quite a different approach to scams-related work across the economy. And, as you will no doubt be aware, the government decided effectively to bring together the National Anti-Scam Centre—the ACCC is the lead regulator there—and ASIC and the ACMA, the Communications and Media Authority, who also play a key role. Our observation is that it's working very well, in the sense that before that time the responsibility for scams was spread across a range of different regulators but there was no particular lead agency responsible for it. The ACCC, I think, has always taken the lead. They publish, every year, an annual scams report. It's very important and updates how many reports have been made and how much money has been reported lost and the like. But the NASC has certainly brought that together in a far more coordinated way. One of the things we've been most concerned about, though, is to make sure that we are avoiding duplication and operating in as coordinated a fashion as we can. The other new feature that the NASC introduced was to recognise that combating and disrupting scams is not just an issue for regulators, or for policymakers for that matter, but that we need to bring industry to the table as well. That's been done; there's a NASC advisory board that involves a whole range of people, including the regulators and the policymakers, but also industry representatives, digital platforms, consumer groups, small business and the like. They all come together, chaired by the NASC, maybe four or five times a year. Then there is a regulator steering committee that I sit on with the Deputy Chair of the ACCC and one of the members of the ACMA. We work together every month to make sure that we're all very coordinated, and then each agency, if you like, has a range of its own activities that we are getting on with and making sure that we don't duplicate. Within the ASIC jurisdiction, we focus very much on investment scams—that's our jurisdiction. We focus a lot on working with the banks. We've done a lot of deep dives and reporting on the banks and the way that they approach scams. That has matured a lot, it's fair to say, over recent years. And finally, we've got, as you'll be well aware, the Scams Prevention Framework, which is formalising the roles of those three regulators. We're looking forward to getting to work under the Scams Prevention Framework when the last pieces come into place. I think it was just this week that the Assistant Treasurer designated the banks, the telecommunication providers and some of the digital platforms as the first sectors to come under the SPF, so ASIC will have a very active role in relation to those changes. Mr MONCRIEFF: Do you think you have better institutional knowledge to deal with scams in the financial sector than the NASC? Ms Court : I don't know that I'd want to say I do anything better than the NASC in relation to scams. What I would say though is, ASIC has deep knowledge in relation to the financial sector, and we have deep knowledge in relation to the way that the banks deal with scams. We have responsibility for overseeing the ePayments Code, for example, which has a scams-adjacent obligation, and ASIC will be, under the Scams Prevention Framework, we anticipate, the designated regulator to deal with the financial sector and the banks. I think that builds on our deep knowledge and work with the banks. In practice, as I understand it, while the overarching scams legislation gives powers to the ACCC alone in relation to all sectors, the code-specific obligations for each sector will be distributed between those three regulators. So, the ACCC will do digital platforms, ASIC will do banks, and the ACMA will do the telecommunications sector. Certainly, in practice, we'll be working very closely with the ACCC to make sure that if there is bank related misconduct that involves scams, I anticipate that, at this stage, it will be ASIC that would do any follow-up and enforcement action, given our depth of understanding and work we've already done in that sector. Mr MONCRIEFF: How do we compare internationally on scams? Everyone has seen a really high increase in the number of, especially, telephone scams and online scams. Is that something that we're seeing across the board in similar countries, or is Australia an outlier in any way on this? I know you engage with the IOSCO. Do similar issues come up across similar jurisdictions? Ms Court : The short answer is yes. Scams are a global and multinational problem that regulators around the world are grappling with. It may have been before you came into the room, Mr Moncrieff, but one of the things that Commissioner Kirkland gave evidence about earlier today was the importance of regulators working together globally. Unfortunately, so many of the scams that Australians fall victim to are online. They come through social media and other posts. We think that the vast majority of those come from overseas jurisdictions. Enforcement is challenging in those circumstances, so our primary focus with scams is disruption. We've introduced a range of things within ASIC to deal with that. I think we've given evidence before about that. We have a website take-down service that has proved to be very effective. When we get notified as to a scam we have a global third-party provider that we can provide information to. They can take that website down very quickly and monitor it to make sure it doesn't immediately pop back up. We've got an investor alert list by which, when there are particular entities that we think are fraudulent or scams, we put them on our investor alert list and encourage and direct people to have a look at that. We do some enforcement action as well. Then, under the IOSCO banner, there is a big piece of work going on in relation to scams, with various jurisdictions working together. Finally, I think it's fair to say that Australia is seen as being ahead of the pack in its regulatory response to scams. It's not something that we've solved; it's going to be a continuing problem. But I think, with the introduction of the Scams Prevention Framework and the various obligations that that is imposing on each of those three sectors and the proposed compensation and liability provisions in that. They are policy issues that Treasury are working their way through. They're hotly contested in some ways. But when those policy positions are landed it will give consumers some certainty about what their redress options are in relation to scams. At the moment, in relation to those redress options, we find that there are inconsistent approaches in the ways the banks deal with complaints about scams. Mr MONCRIEFF: Is that a similar process to what you're seeing internationally? Obviously you're saying that Australia's leading the pack, but are you seeing similar models overseas with the conduct of financial regulators dealing with these financial scams and having other regulators deal with other parts of the system? Ms Court : I think it's fair to say that the solution that's been proposed here, the multi-sector solution, is unique. The reason for that, as I understand it, is that in other jurisdictions, like the UK, the liability sits predominantly with financial institutions. I think the government's idea here was that there are other sectors that are also complicit in scam related activity and that it's appropriate for all sectors to bear some responsibility for consumer losses, not just the financial sector. That's my understanding of the policy position. Mr MONCRIEFF: Thank you. CHAIR: Senator Scarr, I'll go to you for a 15-minute block. I just want to indicate that we have missed our afternoon tea break. Senator Scarr will complete his questioning, then I'll have a last tiny little bit, and we'll depart a little earlier without the afternoon tea break. I thought you might like that! Ms Court : Thank you, Senator, we do like that. Mr Longo : That's very thoughtful. CHAIR: It's a departing present for you, Chair Longo! Mr Longo : I can't imagine why you'd think there'd be any party, Senator! Senator SCARR: He might have preferred us to go on longer! CHAIR: Well, we'll know by the length of the answers! Senator Scarr. Senator SCARR: I'll go back to the First Guardian and Shield matter. I want to talk about Diversa trustees. I saw an article from 9 October 2025—the timing's quite interesting—by Lucas Baird in the AFR. I'll just quote from the article: Superannuation group Diversa Trustees has paid its chief executive Andrew Peterson an enormous bonus even after the business exposed thousands of consumers to the First Guardian Master Fund via its wrap platforms and facilitated $250 million of investment into the allegedly fraudulent scheme. Then the amounts of the bonuses—so this is on top of base remuneration—that it's reported Mr Peterson received were, for the year ending 30 June 2025, $777,000, which gave him total base and STI of $1.7 million for that year; and, for the year ending 30 June 2024, he got an STI of $630,000 on top of his base remuneration. Then I note, using your helpful chronology, that, in December—barely a few months after that article disclosing these extraordinary amounts of remuneration—ASIC commenced legal proceedings against Diversa. So I want to give you the opportunity, Chair, to tell us what that legal action is addressed to. Ms Court : As we've already mentioned, ASIC has had an extensive array of enforcement work arising as a result of the failures of the First Guardian and Shield master funds. Diversa is one of the superannuation trustees who allowed the First Guardian Master Fund to be on its platform, and retail superannuation investors were able to invest in that fund through the Diversa trustees platform. We have a fundamental concern—and, as you say, we've taken proceedings, in December, which are alleging, in relation to Diversa, that, in broad, layperson's terms, Diversa should not have allowed the First Guardian Master Fund on its platform. So our allegations are that it failed to conduct adequate due diligence before allowing its members to invest, and that it also failed to conduct ongoing monitoring as to what was going on in relation to that fund. There's a more specific allegation as well: that we consider that Diversa had in place a 50 per cent holding limit in relation to investments in the First Guardian Master Fund, yet we saw multiple examples of members' funds that were well in excess of that 50 per cent. So another part of our allegation is that it failed to have the systems and processes in place to make sure that that 50 per cent holding limit was complied with. So our allegations are that Diversa, as the superannuation trustee, has a legal duty to put its members first, act with care and skill, and carry out proper checks on the investment options that they make available on their platforms. And we say that they failed in those duties and obligations. We've also sought compensation in those proceedings. That's unusual for ASIC. We don't see ourselves, generally, as a compensation agency. There are other avenues for people to get compensation. But we did think that the circumstances facing the Shield and First Guardian investors really were of such magnitude, and of such concern, in the sense that they are all within the regulated superannuation environment, that it was important that we do our best to obtain that compensation. To round things out: just in the last week or two, we've also filed proceedings against Equity Trustees in relation to what we allege to be their failures in making the First Guardian Master Fund available to its superannuation members as well. That action against Equity Trustees brings this to completion. We now have court proceedings against all of the trustees that were involved in relation to these failures. Two of those trustees have admitted the conduct, have resolved matters with ASIC and have paid significant compensation or remediation payments back to their members. Diversa is defending these allegations, as is Equity Trustees. Senator SCARR: Quite often, in the context of ASIC's enforcement proceedings, you'll bring action against a company. You'll also bring actions against, say, managing directors and independent directors as part of enforcement proceedings. To what extent have proceedings been instituted in the context of Diversa and Equity Trustees against actual individuals, actual persons? Ms Court : We haven't joined any individuals in those actions. We did consider it. We looked at the evidence that was available, but ultimately we determined that the evidence supported action against the trustees themselves. Senator SCARR: Ms Court, you can understand how I'm looking at that article and these huge amounts of bonuses that were paid, some of which may be attributable to financial flows which came back to Diversa as a result of consumers investing in First Guardian and Shield—are there any other avenues for clawback of these sorts of bonuses and short-term incentives from executives or corporate officers who had roles with respect to the management and supervision of these trustees? Ms Court : I think that's a very fair question. Without wanting to comment on this particular CEO, I think we've talked to this committee before at length about the challenges of individual accountability for particular actions. There are legal tests that have to be fulfilled to hold an individual accountable. We do that where we can, but, in relation to these matters against Diversa and Equity Trustees, we made the decision that the most prudent way for us to proceed was to take the action against the responsible entity itself and to focus on trying to get that compensation for those investors. Senator SCARR: I respect the decision. I've got no doubt you would've carefully considered that. But do you appreciate the reason I asked the question? Ms Court : I certainly do. Senator SCARR: In relation to Diversa, an article on 23 March 2026 mentioned that two of its largest customers had taken concerns to APRA in relation to Diversa's superannuation business. They were concerned that it was overcharging their members and blocking their efforts to find new trustees for retirement savings. That raised considerable concern in my mind. Given what's on the public record and the proceedings which have been instituted in relation to Diversa, I can well understand why some of Diversa's customers may be looking to take that action. To what extent does ASIC coordinate with APRA in relation to matters like that? Would you expect APRA to contact ASIC to consider information as to whether or not the efforts of those customers to seek new trustees shouldn't be blocked? Ms Court : We have been engaging with APRA very intensely in relation to the whole suite of matters associated with the Shield and First Guardian master funds, and I know that Commissioner Constant and I speak to them regularly, as does our team. In relation to the particular issue you've raised with me, I haven't personally spoken to APRA about that, but I know our teams will be well aware of it and will share information as required by APRA. Senator SCARR: Ms Constant? Ms Constant : I can confirm that, including the sharing of information in regard to some of those client concerns that have been raised. Senator SCARR: Can I ask you to take on notice that particular issue? Ms Constant : Yes. Senator SCARR: It concerns me that on the face of it you have Diversa customers seeking to transition to another trustee and it appears they're being, to use the words in the article, blocked from doing so. Ms Court : Yes. Senator SCARR: I think APRA is on next week in terms of Senate estimates, so it might well be a matter I raise with them. And you can tell me in the corridor afterwards if there's anything else I should be asking APRA! I want to come back to Mr Kirkland's efforts as a putative radio announcer. In terms of advertising, presumably the liquidators of First Guardian and Shield have provided liquidators' reports. Do those reports provide any detail with respect to the funds they spent on marketing? This comes back to my knife-and-gun analogy in terms of being outarmed. Is there any indication you've received in relation to how much money Shield and First Guardian were spending on marketing? Mr Kirkland : I don't believe there is. Mr Savundra may be able to answer that question directly. Mr Savundra : I believe the reports in relation to First Guardian indicate over $40 million on marketing, in large part— Senator SCARR: Sorry, over how much? Mr Savundra : Over $40 million. Senator SCARR: Forty million? Mr Savundra : Yes. I'll come to Shield shortly. That was First Guardian. That's based off information that we've adduced to court in relation to the various proceedings, so I think some caution needs to be exercised around that figure. When we say it's marketing, it's payments to lead generators and the like, so it depends on how you use that term 'marketing'. In relation to Shield, the figure, I believe, is somewhere around $65 million. Senator SCARR: Goodness me! Mr Savundra : That includes lead generators. Senator SCARR: So these are the funds spent on lead generators et cetera. These are huge amounts of money being dedicated to bringing in new customers, using a broader definition of 'marketing. You'd accept, Mr Savundra, that these are big numbers? Mr Savundra : Yes, absolutely. Senator SCARR: Chair Longo, how big is your advertising budget? Mr Longo : That's an excellent point. One data point that was brought to my attention today is that a mere $600,000 has been devoted to Moneysmart. We don't have an advertising budget. Maybe Scott, our CEO, or someone else at the table can give a bit more detail about how we fund Moneysmart's activities. Senator SCARR: Mr Gregson, have you had the opportunity— Mr Longo : But I can say to the committee that it is an absolute fraction of what was spent luring investors into these matters. Mr Gregson? CHAIR: Moneysmart is $600,000 and 'money dumb' is $40 million. Senator SCARR: Mr Gregson, I want to give you an opportunity to put something on Hansard here. Do you have any further figures or insight you can give us? Mr Gregson : No, Senator. I can confirm we don't have an advertising budget of that nature. If I could put a plug in for Moneysmart, I think committees like this would do well to promote its take-up and continue to make sure we're resourced to deliver that. It really is a small amount compared to what you see companies doing. Mr Kirkland : Just for the sake of completeness, I will say that we do have some additional funding this year and in the next few years to do additional advertising of Moneysmart's information in relation to super and retirement. But the roughly $600,000 a year is just the normal allocation in a normal year for any Moneysmart advertising. Senator SCARR: Well, I think Moneysmart is an excellent service, and all Australians should go onto Moneysmart and make the most of it. CHAIR: Hear, hear! Senator SCARR: And that's written and authorised by Senator Paul Scarr. My last question is in relation to prediction markets. Who's the expert on prediction markets? Mr Longo : It depends on your question, Senator. Senator SCARR: Well, I'm not asking for tips; it is about regulatory issues arising from prediction markets. Ms Constant : You're talking of the emerging trend of the rise of prediction markets overseas? Senator SCARR: Correct. That's you, Ms Constant? Ms Constant : It's me. Senator SCARR: Okay, I'll put these questions to you. As I understand it, this is something that's arisen in particular over the last few years. There's an entity called Polymarket, and you can essentially bet on a whole range of events or outcomes as to whether or not they're going to occur. Some of them are extraordinarily bleak and dark—for example, as to whether or not forces involved in conflicts will take potential cities by certain times. I don't even want to really put on the public record some of the things they're actually putting on the market in terms of bets. But there are issues I'll particularly raise and seek a response as to what ASIC is doing. Firstly, there was a very helpful ABC report over the last week or so in relation to these prediction markets. There appears to be hundreds of thousands of Australians who are currently betting or investing or whatever you want to say in relation to these markets, which are based overseas so presumably not regulated in the Australian context. Secondly, from some of the research I've quickly looked at—this is an area I'm interested in, and you might take on notice providing further information with respect to a submission before a future hearing—it appears, from analysis undertaken, that there are a very small number of account holders who end up getting a very disproportionate amount of the winnings and a very large number of account holders who lose their money, which raises particular concerns in relation to what we would call in a public markets context 'insider trading'. There are also concerns in relation to the compromising of national security, even national security information, because there's a financial inducement to perhaps access that information in order to participate in these markets. There are many layers to this, so I'm very interested to hear what ASIC is doing in this regard and how you're dealing with that conundrum which we face in a number of areas: do we regulate some way in order to try and mitigate against risks, or do we just keep out of it and have hundreds of thousands of Australians doing their dough in relation to these unregulated markets? Ms Constant : I think you've invited us to talk at this point in time about our perspective on these prediction markets. Contrary to what I often do, it might be worth my reading to you from some of the considerations we've been making because it's quite live and active at ASIC at the moment. Your introduction and question were quite rich. The way we've been thinking about this and considering it is consistent, I think, with the tone and even some of your content. To confirm, we would agree that we've seen that prediction markets have expanded rapidly. That's partly technological. It's partly, as you say, overseas regulatory developments. And, whilst they were a small, unusual category of these markets until recent years, there are now, as you mentioned, a whole wide new range of categories, for example, that introduce a whole wide range of new risks that have given rise to the rise in trading volume in these globally but also absolutely the risk. You called out some there that are just quite dark to consider in nature—so not just this simple binary outcome and, as you say, the lack of winnings that seem to flow through. What we would say at the moment is that we've noted this and it's not that this is not regulated or licensed in elements of licensing that aren't relevant in the Australian context already. We would say that generally this does not sound to be consistent with public interest. That would be the first statement, consistent with your introductory remarks. We're considering appropriate interventions for those limited entities that may already be licensed if there is behaviour that requires us to intervene. But generally, given that your comments are consistent with our view on the public interest here, ASIC, at this stage, is unlikely to be granting licences to offer these products in Australia. We're also thinking about more general positioning with regard to our tone and comment on the rise of these markets, including, as you mentioned, Australians participating through those entities, overseas entities, that we don't regulate and cannot control. Senator SCARR: It's an area I'm interested in that I'll perhaps pursue at our next hearing. Ms Constant : I suspect that will be excellent timing. We will have done more work and thought about our public messaging and also considered the rise here and had a look at those limited entities that may have an element of licence to offer this at the moment and how that is being used. That will be excellent timing. It's not lost on us—the fast, accelerating take-up of these prediction markets. Senator SCARR: Thank you. CHAIR: 'Fast and accelerating'—I was going to ask questions about the SpaceX listing; it's supposed to be pretty fast and accelerating technology! I think there were also questions from Ms Jarrett that we were thinking about asking with regard to AI, cybersecurity et cetera, but I think we'll leave those for discussion on another day. If there's anything important that you think we should know about either of those matters, I trust you'll let us know. I want to conclude with— Ms Constant : Chair, I would just mention, on Frontier AI, that we wrote an open letter in recent weeks under my name to entities. Perhaps, next time, that would be a good starting point for discussion, and how we've seen entities respond or not to that. CHAIR: Ms Jarrett won't let you get away without that now! She's interested, and you've made a commitment, so I expect that will definitely be a matter of discussion at our next meeting. I just want to indicate that I came across a document—I won't ask you to read it—which is KPMG's Top risks to Australian businesses 2024-25. On page 3, it asserts, with regard to the matters of trust and reputation: Declining trust in public institutions and leaders is translating into increased expectations of businesses. Because growth requires trust, companies will need to work harder to build and maintain the public's trust by ensuring transparency, demonstrating ethical conduct, and taking responsibility for the conduct of suppliers further up the supply chain than ever before. The challenge will be in ensuring that building trust with one section of the community does not undermine trust elsewhere. It's hard to read that, in light of what has happened today and the experience of the whistleblower over the entire period in which this must be put together. So I wanted to just make a couple of concluding observations and give you an opportunity to comment. You indicated in your opening statement, Mr Longo, a significant increase in a range of enforcement activities and court outcomes, and these are all in the document that you've given to me. In not one of them can I see any statements about auditors. Are there any auditors who've suffered major financial blows or been excluded from continuing in the sector? Mr Longo : I'm not aware of any particular auditors being excluded. Commissioner? Ms O'Rourke : In the summary that was included as an outline ahead of this morning, there was a selection of matters but certainly not a full representation of all of the outcomes or current actions that are being taken in relation to our enforcement. CHAIR: Could you then, on notice, give us an exclusive list of auditors— Ms O'Rourke : Sure. CHAIR: and the degree of sanction? Clearly, something's not working, if the cultures that are being revealed here continue to just be discovered by this committee following extraordinary efforts by whistleblowers. There has got to be something done better to prevent egregious behaviour of this kind in these major auditing companies. Ms Court : We'll take it on notice. Ms O'Rourke : We'll take that on notice, but we do have a range of enforcement related activity. In fact, we took Federal Court proceedings in December, suing BDO Audit and its director, Mr Just, and alleging materially false or misleading audit reports. There have been multiple cancellations by the CADB of auditor registrations. So we'll take it on notice, but I just want to assure you that that has been an enforcement priority in 2026, and we have a range of things that we can talk to you about when we have more time—about the work that we've been doing there. CHAIR: Thank you, and maybe a bit of an update on how many referrals there were to the CADB, because there was a period when that wasn't occurring, and I'm not sure if that has changed in any way. Ms Court : I can tell you we currently have 36 open matters underway in relation to auditor investigations; 16 of those are preliminary inquiries and 20 of those are current investigations. CHAIR: If I look at the Macquarie Securities information that you have here, you said that MSAL failed to correctly report at least 73 million short sales between 11 December 2009 and 14 February 2024. ASIC estimated 298 million to 1.5 billion in short sales may have been misreported owing to significant deficiencies in systems, processes and patrols over more than a decade. The civil penalty for that matter was a $35 million civil penalty. I don't know how that could have occurred without significant engagement of auditors at some points. Who was auditing Macquarie Securities at that time? What was going on there? What's your action to the auditors who were involved with the reporting of MSAL, Macquarie Securities (Australia) Limited, between December 2009 and 2024, and what action or investigation was undertaken with regard to failures of audit, which are, retrospectively, likely to have been occurring. Ms Court : We might take that on notice, if that's all right. I don't have that information in front of me. CHAIR: Finally, one of the things I've been trying to say—and I've just found these wonderful words from you that I think say it most succinctly—is on my concerns about investors, sophisticated and unsophisticated, old and young, SMSFs, trustees, retail and industry—everybody who is engaged in the Australian Stock Exchange or in the trading of financial products. This is what you said with regard to urban ecological systems: 'It's a public company. Each company is required by law to provide financial reports to ASIC and report to its members, among other obligations.' You said: 'These reporting requirements,' which are absolutely intimately connected with audit, 'are in place to help shareholders and those dealing with these businesses to make informed decisions and support the integrity of Australia's financial system.' Well, today I think we've seen real threats to that, which have led to the resignation of the CEO of one of the biggest of the audit companies that service Australia's financial system. I'm sure that, like me, you are appalled. That is one thing, but we need to have incredible action in response to this. It's an opportunity not just to send a message but to make sure that it's delivered and received and that change occurs. I want to acknowledge the fourth estate in this matter of KPMG and how critical they have been in following up and checking their sources. In addition to the whistleblower who has contacted us, and who is likely to be the one who contacted you—and certainly the one who contacted KPMG—there are other whistleblowers now finding courage to come forward as well to verify some of the things that were unable to be found by KPMG. I also particularly acknowledge Mr Ed Tadros for his dedication to the task— Senator SCARR: Chair, to clarify, you said 'uncovering some of the things that were unable to be uncovered by KPMG'. That's still very much in question, isn't it? CHAIR: It is a matter for consideration. It's true at this point in time that they didn't find the resources to find what was there before their eyes. Mr Tadros, I think, deserves particular recognition for his service to the Australian people through proper reporting. Also, in recent days I note Ms Tansy Harcourt in the Australian. The Australian Financial Review and the Australian have been covering this matter quite significantly, and I want to acknowledge that. I encourage you to communicate with both those people because, clearly, they have trust with some of the participants, and I expect that they would be able, within the boundaries of their professional responsibilities, to assist you further too. Ms Court : Senator O'Neill, before you leave the topic of KPMG, can I just put one other thing on the record. It flows from the conversation this morning and your request to be told when ASIC has been contacted about the events of today. It's just come to our attention in the last little while that we did get an email from KPMG at 5.33 yesterday evening, letting us know that there would be 'an update that KPMG expects to announce tomorrow morning'—that is, this morning—'in response to the whistleblower allegations'. It said: 'The relevant decisions are currently being finalised. We also intend to write formally to ASIC tomorrow and will offer to provide an in-person briefing. We understand you're before the committee tomorrow, so please reach out if you would like to discuss.' We got that email yesterday evening. I wasn't aware of it when we spoke earlier, so I just wanted to put it on the record. CHAIR: I don't believe that this committee has received any such communication—not that we're aware of. We'll double-check that. Thank you. Ms Court : We certainly had no details, just the fact that there would be the announcement today. CHAIR: Thank you very much for the fullness of the response and the clarification there. I thank all the commissioners for your ongoing work, for your attendance here today and for your frank and honest answers to the questions we've asked you today. I thank my fellow senators and members of the Australian parliament. Thank you for your attendance and your curiosity about matters of importance to the Australian people. I also very much thank the secretariat for their hard work in preparing this, and I want to thank my fantastic staff for their hard work. I really appreciate their support in bringing materials here, well prepared. Committee adjourned at 16 : 16