ASIC’s deputy chair has resigned and the chair of the corporate watchdog has stood aside after questions were raised over relocation expenses.

Deputy Chair Daniel Crennan confirmed his resignation on Monday after Chair James Shipton on Friday announced he was stepping aside pending an investigation by Treasury.

The national audit office recommended the probe after questions were raised about a $118,500 payment for tax advice given to Mr Shipton following his 2018 relocation to Australia from the US.

The ANAO was also concerned about $70,000 of accommodation payments made to Mr Crennan after he relocated from Melbourne to Sydney in 2019.

Auditor General Grant Hehir raised his concerns in a letter to Treasurer Josh Frydenberg dated October 22.

“During the 2019-20 financial statements audit of the Australian Securities and Investments Commission (ASIC), the ANAO identified payments made on behalf of the ASIC Chair and one Deputy Chair that we consider may exceed the limits set in the Remuneration Determination made by the Remuneration Tribunal,” Mr Hehir said.

“In reviewing these payments made in relation to the Chair, the ANAO also identified instances where the Commonwealth Procurement Rules were not followed and payments were made on behalf of the Chair where appropriate governance mechanisms were lacking.

“I consider these as important matters to bring to your attention as they relate to the stewardship by the accountable authority of taxpayer resources, particularly with respect to payments made to the benefit of the accountable authority.”

Mr Frydenberg has ordered an independent review into the ANAO findings, which will be conducted by Vivienne Thom.

In the current circumstances, I have decided that it is in the best interests of ASIC for me to resign now.

Daniel Crennan

In a statement to the House of Representatives Standing Committee on Economics on Friday Mr Shipton said while he belived he had acted properly and appropriately in the matter, he held himself to the hightest standards.

“I have advised the Treasurer this afternoon that, in the circumstances, it is appropriate to stand aside pending the outcome of the review,” he said.

On Monday Mr Crennan said it was in the best interests of ASIC to resign from the corporate watchdog.

“I had been intending to retire from my position in July 2021,” Mr Crennan said in a statement to the media.

“However, in the current circumstances, I have decided that it is in the best interests of ASIC for me to resign now. I have therefore tendered my resignation to the treasurer with immediate effect.”

Both men have agreed to repay the money.