An RSL NSW state councillor who resigned recently on principle over the financial scandal engulfing the league has made a frank admission that "no one of that era is completely exonerated" as the leadership faces a looming grassroots backlash.
Fairfax Media can also reveal that one state councillor is the subject of an investigation over whether Bondi Junction sub-branch, of which he is secretary, has illegally denied membership to an RAAF veteran.
Bill Harrigan, a former Australian Federal Police officer, could face a disciplinary tribunal if an RSL investigator finds evidence he has used his power to exclude dissenters as the veteran claims. Mr Harrigan denies the allegations.
The state councillor who has resigned, Rod Bain, told Fairfax Media that information was withheld from some councillors about the financial issues that are now the subject of investigations by police, the charities watchdog and internal auditors appointed by the league's national council.
These include credit card spending of $475,000 by former state president Don Rowe and hundreds of thousands of dollars paid in consulting fees by the RSL's aged care arm to several state councillors including stood-aside national president Rod White.
Dr Bain, who himself is implicated in none of the alleged wrongdoing, said that some councillors and staff had failed to keep the rest of the council informed about the financial issues.
But he added: "We as directors at that time also might well be accused of failing in our performance of the necessary due diligence required and did not double check exactly what we were being told.
"No one of that era is completely exonerated if we consider the duties and responsibilities of a director to a board."
The state council faces rising rank-and-file anger, with a push within the Far Western Metropolitan District for a vote of no confidence in the council followed by its removal and replacement by an administrator, according to internal emails seen by Fairfax Media.
On Friday, the state council faced a closed hearing in Canberra to answer charges by the national council of bringing the league into disrepute and for failing to properly deal with Mr Rowe's credit card spending.
The national council has demanded the NSW leadership show cause why it shouldn't be dissolved.
On the Bondi Junction stoush, NSW chief executive Glenn Kolomeitz - an East Timor and Afghanistan Army veteran - met with Mr Kawicki two weeks ago and heard Mr Kawicki's complaint that Mr Harrigan had used his positions to quash dissent at the sub-branch and RSL club.
Mr Kolomeitz later wrote to Mr Kawicki saying "the issues you raised with me are very concerning such that it is my intention to refer the matter to the RSL NSW state branch investigator for investigation".
Another veteran who clashed with Mr Harrigan, Frank Bugner, said he had been physically escorted from Bondi Junction club after a sub-branch meeting and as a result had joined Maroubra sub-branch instead.
Mr Harrigan said Mr Kawicki had failed to renew his sub-branch membership 2011 and had been denied renewal three years later because of his behaviour.
"I'm held in very, very high esteem by the membership … and I've always worked hard for the RSL," Mr Harrigan said.
Mr Kawicki said as a life member he did not have to pay renewal fees. He said he tried to renew repeatedly and had never been informed in writing as per the league constitution that his membership was being revoked.