Victoria's royal commission into police recruiting criminal lawyers to dob on clients has struck a hurdle before it's begun after revelations a high profile informer was on the books a decade longer than previously admitted.
One of the inquiry's two commissioners quit on Wednesday amid fears his involvement would be deemed a conflict of interest after revelations 'Lawyer X' was first recruited in 1995, not 2005 as previously reported.
Victoria Police blamed "shortcomings in our record keeping" as they revealed the details about Lawyer X, who cannot be named for legal reasons.
The date change means the gangland lawyer's days as an informant crossed over with proposed commissioner Malcolm Hyde's time with Victoria Police.
"While Mr Hyde has indicated he is satisfied there are no direct conflicts of interest, I understand Mr Hyde has made this decision to remove any adverse perceptions about the royal commission's impartiality," Attorney-General Jill Hennessy said.
Mr Hyde had been appointed as a commissioner in December, along with former president of the Queensland Court of Appeal Margaret McMurdo, who will now oversee the investigation solo.
He joined Victoria Police in 1967 and rose through the ranks, appointed as a deputy commissioner in 1994 before being made South Australian police commissioner in 1997 and retiring in 2012.
Victoria Police said it established Lawyer X was registered as an informer in 1995, during preparations for the royal commission.
"This information had not previously been identified due to shortcomings in our record keeping practices related to informers in the mid-1990s," a statement from the force read.
"These practices have since been comprehensively improved.
"On establishing this important information, we took steps to ensure the royal commission was informed."
Shadow Attorney-General Edward O'Donohue said the situation was "not good enough" and should never have unfolded.
"The Lawyer X royal commission has quickly turned into a dog's breakfast," he said.
"Jill Hennessy, when she made comment to the media last December, promised the two commissioners would be from outside Victoria to ensure this exact situation that has arisen doesn't arrive."
Attorney-general Ms Hennessy insisted Mr Hyde had "no knowledge or involvement in this matter" but wanted to put any doubt to rest about his impartiality.
"There have also been a number of other informants that have been identified and willingly disclosed," the attorney-general said.
"As a consequence of this new information the government has amended the terms of reference of the royal commission to ensure the extended scope of period of time can be properly investigated."
Lawyer X leaked information about clients to police, in a possible breach of confidentiality, during the height of Melbourne's gangland war and has been linked to hundreds of convictions and the seizure of more than $60 million in assets.
The revelation has thrown into doubt the convictions and sentencing of major crooks including drug lord Tony Mokbel.
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