Australian Securities and Investments Commission deputy chair Daniel Crennan quit after it emerged he claimed nearly $70,000 from taxpayers to cover rent.

It was revealed in a Senate estimates on Tuesday the Australian National Audit Office flagged potential issues with the payments in August last year.

But the rental help didn't stop until September when legal advice confirmed to ASIC the payments may have been unlawful.

ASIC chair James Shipton has stepped aside after it was revealed the agency paid more than $118,000 for him to receive personal tax advice.

The committee heard Mr Shipton, whose base salary was $811,654 last year, would be on paid leave while an independent investigation into both scandals is completed.

The probe is not due to report until the end of the year.

Acting chair Karen Chester corrected earlier evidence suggesting the auditor-general discovered the matters.

"ASIC staff identified these payments and brought them to the attention of the ANAO as part of the year end audit," she told a Senate estimates hearing on Tuesday.

Ms Chester said the full commission found out about the expenses through the audit office, but not until September.

Committee chair and Liberal senator James Paterson blasted the watchdog's failure to stop the payments for more than a year after being told about them.

"ASIC's leadership structure is a total mess," he told the hearing.

"It is totally incapable of addressing what should be an absolutely basic requirement of any regulator, which is to have your own house in order."

Senator Paterson questioned why the payments to Mr Crennan weren't immediately stopped.

"You're asking me a question that should be put to Mr Shipton," Ms Chester said after admitting the delay was a failing.

Shadow assistant treasurer Stephen Jones said the facts were not disputed, meaning the investigation should be wrapped up within two weeks.

"Australian corporations are going through their most turbulent time since the Great Depression," he told AAP.

"They need a regulator which is focused on the economy and the future of Australian business, not on their own internal debacles."

Mr Jones said it was extraordinary taxpayers had forked out $118,000 in unlawful payments to minimise tax and $70,000 in rental allowances.

"It's a devastating blow to ASIC," he said.

"At a time when we need the corporate cop to be on the top of its game, it's actually on the bottom of the ladder."

Australian Associated Press