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   Feb 13

RSL NSW council will stand aside over financial scandal – but only on its own terms

Former NSW RSL president Don Rowe at Sydney’s Hyde Park war memorial. Photo: Ben Rushton The RSL NSW council says it is prepared to stand aside en masse and have a caretaker put in place while claims it mishandled financial misconduct allegations are investigated – but only if it gets to choose the caretaker.
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The condition set by the beleaguered NSW leadership has sparked an angry response from some RSL members and deepened a stoush with the league’s national board.

A message sent out to RSL members says the state council agreed at a meeting on Monday that it “will voluntarily stand aside on an interim basis pending the results of a board of inquiry into allegations of financial misconduct”.

The move follows months of reporting by Fairfax Media on financial concerns plaguing the league.

But the council will only stand aside if the national board withdraws disciplinary charges that the NSW state council failed to deal properly with questions surrounding former state president Don Rowe’s corporate credit card spending.

Those charges would instead be dealt with by a NSW board of inquiry.

NSW is also demanding that the caretaker appointed is retired Major-General David McLachlan, who retired from the role of Victoria RSL president two weeks ago. Under the NSW demands, Mr McLachlan would set the terms of reference for the inquiry, which would have to report within the tight timeframe of one month.

NSW president John Haines said the council wanted a “neutral” person to ensure that “we get a fair go”.

Acting national president Robert Dick said the national board had proposed a month ago to drop the disciplinary charges and turn them over to board of inquiry if the NSW council would stand aside.

He said the national board had only on Tuesday seen the NSW counter offer and had to consider it, but stressed “the national board will not allow the RSL NSW state council to set their own conditions”.

As things stood, the charges were not dropped and a disciplinary hearing against NSW would go ahead next week, he said.

Mr Rowe spent $475,000 in six years, including $213,000 in cash withdrawals, and paid the mobile phone bills for five family members. Among the cash withdrawals were $2300 in 17 days over the 2013 Christmas and New Year’s period in his home town of Armidale.

Mr Rowe was allowed to resign for health reasons in November 2014 but audit firm Grant Thornton was hired to investigate a year of Mr Rowe’s spending and concluded there was “potentially a prima facie case of fraud”.

The council was briefed on the audit in January 2015 but no further action was taken and RSL members were not told that Mr Rowe resigned for reasons other than ill health until two months ago following a forensic audit by another firm, KordaMentha.

However, the conditions set by the NSW council have provoked fury among some members. James Brown, vice president of North Bondi sub-branch and a candidate for state president in the next election, branded the move “the dying gasp of a dysfunctional council facing multiple allegations of wrongdoing, including a criminal investigation into fraud and misuse of charity funds”.

“Half the council have resigned in protest. The remainder now emerge from weeks of secret meetings and propose handing control of our organisation to someone who is not a member of RSL NSW and has not been elected to any leadership position,” he said.

He welcomed the council’s offer to stand aside but said the chief executive and his staff, rather than a caretaker, should run the organisation until the election at the end of May.

Support meanwhile is being drummed up for a motion to call an extraordinary congress which would dismiss the NSW council and appoint a trustee company RSL Custodian to oversee the organisation.

One RSL member with knowledge of the inner workings of the league said that about 70 of the state’s roughly 360 sub-branches had already pledged support to the motion.

The member said that the NSW demand was “unacceptable and does not alleviate the concerns of members”.

Mr McLachlan said he would be happy to take on the role and would conduct himself independently.

“Anybody that knows me on the national board and anywhere else knows that I’m a very impartial person when it comes to matters of this kind and my integrity is the most important quality I own,” he said.

A board of inquiry has already been flagged to look at a range of broader financial concerns within NSW, including the payment of hundreds of thousands of dollars to councillors in consulting fees by the league’s aged care arm in the state. Mr Rowe was one of those councillors, as was former national president Rod White who recently stood aside.

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