The Construction, Forestry and Maritime Employees Union's (CFMEU) administration alleges the former union secretary diverted $3.3 million in revenue from merchandise and site vending machines to his own companies.
He has had his CFMEU membership ripped up for a maximum of five years, effective immediately.
The union's administrator, Michael Crosby, says Mr Setka is facing 27 charges under the CFMEU's disciplinary process, alleging he failed in his duty as secretary of the organisation.
"John Setka held a position of responsibility but abused that privilege to take millions of dollars from the members of the CFMEU," Crosby alleged.
"John Setka's conduct is shameful. He has failed in the most basic duties of a union official – to put members' interests above all."
Mr Crosby has vowed the union would continue to pursue Setka for the misappropriated funds.
Mr Setka did not respond to the allegations put forward by the CFMEU administration, according to Mr Crosby.
The 62-year-old served as secretary of the CFMEU for more than a decade before stepping down in July 2024 following explosive allegations of criminal conduct.
He has always denied all allegations of misconduct.
The CFMEU was plunged into administration by the federal government one month after Setka's resignation following claims of bikie and organised crime figures infiltrating the union.
CFMEU representatives are taking to the witness box this week in the first block of public hearings of a Royal Commission into alleged corruption on the state government's Big Build sites.
Mr Setka has been contacted for comment.
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