The navy is taking action against eight sailors following allegations of bizarre hazing rituals aboard the frigate HMAS Ballarat.
Some could be booted out while others receive formal warnings.
The eight have the opportunity to respond before any formal action is taken.
Claims of misconduct aboard Ballarat emerged last year and the navy has never disclosed the substance of these allegations.
But after the defence investigation was made public, a former naval member claimed sailors were "set upon, stripped off and had things essentially put in their bums".
That was apparently to mark sailors' birthdays.
Navy chief Vice Admiral Ray Griggs said launching administrative action demonstrated the navy's commitment to address such behaviour.
"All personnel are aware that Navy will not tolerate unacceptable behaviour," he said in a statement.
The navy inquiry found no clear evidence of systemic unacceptable behaviour or a deep-seated culture of hazing ceremonies or rituals within the ship.
Separate to the administrative inquiry, the Australian Defence Force Investigative Service conducted its own inquiry.
It sent a brief of evidence to the Director of Military Prosecutions, who declined to launch any prosecutions on grounds that there was insufficient evidence to provide a reasonable prospect of conviction.
Vice Admiral Griggs called at the time of the initial allegations for others to come forward if they knew of other instances of the alleged behaviour.
One such case emerged and that's now being examined by ADFIS.
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