KPMG Partner Fined $10k for Using AI to Cheat on AI Exam [AU]
KPMG Australia has identified 28 instances of staff using AI to cheat on internal assessments since July 2025. The headline case: a partner who uploaded training materials into an AI tool to answer questions during an open-book exam about AI. The partner is paying a $10,000 fine directly, with further sanctions expected from Chartered Accountants ANZ.
The irony is not subtle. The test was open-book, meaning the partner could consult materials. What they could not do was feed those materials into AI for automated answers. KPMG's internal monitoring flagged the activity in August 2025.
"Like most organisations, we have been grappling with the role and use of AI as it relates to internal training and testing," KPMG Australia CEO Andrew Yates told the Australian Financial Review. "It's a very hard thing to get on top of given how quickly society has embraced it."
The firm introduced AI monitoring in 2024 specifically to detect this behaviour, building on previous compliance failures where widespread cheating occurred between 2016 and 2020. The other 27 cases involve manager-level and junior employees.
To KPMG's credit, the firm caught the violations and the partner self-reported to Chartered Accountants ANZ. The firm also voluntarily disclosed all cases to the Australian Securities and Investments Commission (ASIC), though that transparency has an asterisk. ASIC confirmed KPMG had not filed reports before the Financial Review broke the story in December. Only after that article did KPMG provide details, including the partner's involvement.
Current rules only require firms to report misconduct to ASIC if a professional body has already imposed punishment. Chartered Accountants ANZ is still investigating, so KPMG was not technically required to report yet.
For context, average partner pay at KPMG Australia was $715,000 in 2025. The $10,000 fine represents about 1.4% of annual compensation.
This will not be the last time a firm grapples with AI misuse during assessments. KPMG is simply the first to make headlines.