Allegations of conflict of interest and a secret plan to seize assets from sub-branches have emerged against RSL New South Wales. An external investigation into RSL NSW President Mick Bainbridge and board director Paul James claims they violated the charity's conflict of interest rules and its charter. The investigation also suggests their actions may have breached their professional legal obligations.

The confidential investigation was initiated following a complaint from former RSL NSW Chair Sophie Ray. She alleged that Bainbridge and James did not disclose their representation of a former volunteer in legal proceedings against RSL LifeCare, a sister charity to RSL NSW. Ray expressed her shock at the situation, stating, "There is absolutely no way they should have been part of those [board] discussions … but at the time we didn't know they were acting for [a client in a case against] RSL LifeCare."

Ray further claimed that when she pressed Bainbridge and James to declare their client in the board's register of interests, James threatened to sue her if she continued. The investigation upheld two of Ray's claims, confirming that Bainbridge and James's actions constituted a conflict of interest and may have breached their professional obligations as lawyers.

Legal advice provided to the acting CEO of RSL NSW indicated that the organization might have grounds to take disciplinary action against Bainbridge and James, including their removal from the board. Ray described the situation as "unprecedented" in her professional experience.

In response to the allegations, RSL NSW stated it is reviewing its conflict of interest management practices and consulting a work health and safety expert. A joint meeting of the board and district presidents' council is scheduled for October 9 to vote on the potential dismissal of Bainbridge and James.

Bainbridge and James declined to participate in an interview regarding the allegations and did not respond to written questions. However, during a recent parliamentary committee appearance, James defended his law firm, stating it has "information barriers" approved by the Law Society. Bainbridge expressed confidence in the support of RSL members in a letter.

Bainbridge, a former commando who served in Afghanistan, became a prominent advocate for veteran welfare after his military service. In 2019, he and James founded Operational Legal Australia (OLA), a law firm dedicated to supporting veterans. Both men joined the RSL NSW board, with Bainbridge elected as president. His election was seen as a fresh start for the organization, which had faced scandals in the past.

However, within a year, Bainbridge and James faced scrutiny again. In October 2024, Senator Jacqui Lambie accused OLA of overcharging veterans and providing inadequate services. Reports indicate that 12 complaints against OLA have been filed with the Office of the Legal Services Commissioner, alleging unprofessional practices, including inflated billing and intimidation of clients.

In a separate issue, James drafted a parliamentary bill aimed at creating a central trust to control millions of dollars in sub-branch assets. This proposal would allow the takeover without consent or consultation from the sub-branches, which number over 300 across New South Wales. Some sub-branches, like North Bondi, hold significant property assets worth millions.

The draft bill, titled "RSL NSW The Path to Financial Sustainability And The Real RSL," was presented to the board in May. It included provisions for transferring property by law without the need for consent. James claimed there was strong support for the takeover from government officials and suggested that a state inquiry would view the reforms positively.

RSL NSW clarified that while it commissioned a review of its financial model, it does not endorse James's proposal to centralize sub-branch assets without member consultation. When shown the draft bill, sub-branch officials expressed outrage. Max Britton from the Oatley RSL sub-branch said he felt "duped" and questioned James's role in drafting legislation for the government.

Josh Farquhar from the North Bondi RSL sub-branch warned that the threat to local sub-branches is "existential," emphasizing their importance to veteran communities. Nikhita Sahay, treasurer of the Combined Services sub-branch, expressed concern about the potential impact on future generations of veterans.

Ray has long feared such a move since Bainbridge and James's election, recalling Bainbridge's suggestion in 2023 to liquidate sub-branch assets to fund services for younger veterans. Bainbridge did not respond to Ray's claims.

The situation continues to develop as RSL NSW navigates these serious allegations and the potential implications for its leadership and the welfare of veterans in the community.