Two Australian banking executives repeatedly drugged a colleague with valium and laxatives during a business trip to South America in a "malicious" attempt to discredit him.

Within hours of the dangerous prank, several photographs of the unconscious man had been emailed from Chile to Australia, where they were circulated among stockbrokers in Melbourne and Sydney.

A senior executive involved in the drugging also sent an image of the South American-branded laxative that was secretly administered to his colleague at an upmarket restaurant in the Chilean capital Santiago.

SUPPLIED Seafood restaurant Peurto Marisko in Las Condes, Santiago, Chile where the victim was drugged.

The 49-year-old victim has launched legal action against the investment bank Macquarie Group, known as the "millionaires factory", which was aware of the extraordinary allegations, but did not take disciplinary action against the perpetrators.

It can be revealed that Macquarie's then divisional director Michael Rosenbaum and investment adviser Stefan Whiting repeatedly spiked the drinks of a colleague as they travelled across Brazil and Chile to inspect gold mines owned by Cleveland Mining Company.

The drugging is believed to have occurred between June 1 and June 10, 2011.

SUPPLIED Former Macquarie Bank investment advisers Stefan Whiting, left, and Michael Rosenbaum.

It was revealed on Wednesday that Cleveland managing director David Mendelawitz had reported three Macquarie staff, including Rosenbaum and Whiting, to the corporate regulator over alleged misconduct between 2011 and 2012.

'BAD BEHAVIOUR'

Australian mining company Cleveland's managing director David Mendelawitz, who travelled with the Macquarie executives in South America, confirmed he witnessed Whiting administering drugs to another investment adviser.

SUPPLIED Former Macquarie adviser Stefan Whiting.

He said he was willing to sign a statutory declaration if required.

"It was amateur hour.

"We were trying to represent Macquarie to our partners in South America as the best and brightest, but they kept behaving like complete d...heads.

SUPPLIED Cleveland Mining Group managing director David Mendelawitz.

"I was naive, and I certainly wouldn't accept this kind of behaviour now," Mendelawitz said.

In an email sent on June 10, 2011, Rosenbaum attached several photographs of his unconscious colleague, including an image in which a marker pen was used to draw a moustache on the man's upper lip, and what appears to be a smiley face on his forehead.

In another image, the victim had passed out on a couch.

Rosenbaum, who continues to work in the stockbroking industry, wrote in the email: "...Chilean style, don't fark with me, u end up down the rabbit hole".

COMPLETE MESS

Mendelawitz said he first became aware of the dangerous prank as they boarded a plane in the coastal of town of La Serena, about 470 kilometres north of the Chilean capital Santiago.

"He was a complete mess, he passed out on the plane".

After arriving in Santiago, they headed to seafood restaurant, Puerto Marisko.

According to Mendelawitz, more valium was slipped into drinks as they dined at the restaurant, before a bottle of Ducolax liquid laxative was purchased at a local pharmacy.

After passing out again, the victim is believed to have been taken back to the Time Apartments in Las Condes. He was wrapped in a bed cover and left in the room.

"It was malicious. Everyone was having a few drinks. They were certainly trying to cut him out of the picture and discredit him in front of me," Mendelawitz said.

He regrets not speaking up at the time, but said he felt "powerless to act".

"I was never a chief executive before, and I couldn't believe what was going on. When you see your share price going up, everyone's happy, but I couldn't believe their behaviour as individuals," Mendelawitz said.

COMPLAINT MADE

Upon their return to Australia, a representative of Macquarie's human resources department is understood to had discussed the incident with the victim, who was removed from the Cleveland account in July 2011.

No action was taken by Macquarie management against Rosenbaum or Whiting, who would become key players in the sharp rise and dramatic collapse of Cleveland's share price in 2012.

Maurice Blackburn has filed a statement of claim on behalf of the victim.

"During the course of the Plaintiff's employment with the Defendant, the Defendant, its servants or agents, drugged, assaulted, humiliated, abused and harassed the Plaintiff, causing the production, aggravation, acceleration and/or recurrence of the Plaintiff's injury," according to the statement of claim.

The victim is seeking compensation for loss of income and medical costs.

Rosenbaum and Whiting did not respond to questions, but issued threats against Fairfax Media via their lawyers.

TREATED WITH 'UTMOST SERIOUSNESS'

A Macquarie spokeswoman also declined to answer questions, but released the following statement.

"Macquarie treats any allegations regarding inappropriate or potentially illegal behaviour with the utmost seriousness, regardless of their source.

"Where matters are raised, Macquarie conducts a thorough investigation and where appropriate, notifies relevant authorities," the spokeswoman said.