Prosecutor Lance Rowe said Mr Comeskey would be called as a witness and would not be able to represent his 41-year-old client.
"If they want me to be a witness, that just indicates to me their current case is shakier than the world economy," Mr Comeskey said.
Being called as a crown witness put him in danger and police needed to take more care, he said.
Inquiry head Detective Senior Sergeant Chris Bensemann would not comment on Mr Comeskey's evidence, but said it would fall under Section 67 of the Evidence Act.
This allows a judge to waive a claim of lawyer-client privilege if satisfied that communication by the client was for a dishonest purpose.
With his contacts in the underworld, detective-turned-criminal lawyer Mr Comeskey brokered the return of the 96 medals.
Reward money totalling $300,000 was paid out and has not been recovered.
Earlier police dismissed suggestions they could charge Mr Comeskey with money laundering.
Mr Comeskey has said all the reward money had been passed on to those responsible for returning the medals and he had not profited.
Auckland University associate law professor Scott Optican said using Section 67 of the Evidence Act was extremely rare.
Mr Comeskey could withdraw from the case or legally fight to remain on it, in which case a decision would be up to the judge.
Dr Optican said lawyer-client privilege could be waived when communication crossed the line into committing an offence.
- NZPA
