Rugby Crisis: Fiji Rugby Union Struggles with Financial Mismanagement
The Fiji Rugby Union (FRU) is facing a deepening financial crisis as numerous breaches of financial policies have come to light. In addition to financial misconduct, there have been allegations of code of conduct breaches and conflicts of interest within the senior staff of the Union. To address these issues, a new interim board, led by chairman Peter Mazey, has been tasked with rectifying the mistakes of the previous board.
One of the key issues highlighted by Mr. Mazey in an interview is the lack of proper budgeting. Despite having a good cash flow, with approximately $22 million received last year, the money was not used for its intended purposes. This has resulted in the FRU operating on an $800,000 bank overdraft, with a total debt of $3.5 million.
While the FRU does have valuable assets, such as properties and a stake in a hotel joint venture, these assets alone cannot sustain the Union financially. Outstanding creditors, including major businesses and hotel chains, have been left waiting for payment for three to four years. Among the creditors is Brian Thorburn, who played a crucial role in establishing the Fijian Drua team. Mr. Thorburn is still owed a significant sum of money by the Union.
Allegations of financial misconduct within the FRU have also surfaced. One instance involves money being used for a staff member’s birthday celebration without proper authorization. Other breaches of procurement and financial processes have been uncovered following a six-month internal investigation and audit conducted by the Union’s team last year.
The interim board, however, clarified that they have not found any evidence of criminal activities. They are primarily focused on addressing the mismanagement of funds and lack of internal policies that contributed to the financial mess. Mr. Mazey emphasized the need to establish clear policies regarding the use of funds from sponsors and other sources.
The financial crisis has had significant implications for the FRU’s operations and teams. The Union recorded a loss of $1,134,816 for the 2022 financial year, primarily due to the impact of COVID-19 and a lack of sponsors. However, in a surprising turn of events, it was later revealed that the loss had increased to $3.5 million.
The situation has also affected the Fijiana 15s team, who have claimed unpaid allowances totaling $172,600 for various matches and championships. Furthermore, both the men’s and women’s 7s teams are operating on a combined loss of $1.5 million.
The interim board is committed to addressing these financial challenges and ensuring the transparency and accountability of the Union. They have engaged a team of independent professionals to investigate the issues and plan to involve relevant authorities, such as the Police or the Fiji Independent Commission Against Corruption, if any criminal activities are discovered.
As the FRU navigates this ongoing crisis, it is crucial for them to establish robust financial policies, rebuild trust with creditors, and secure sustainable sources of revenue. Only by addressing these issues head-on can the FRU hope to restore financial stability and ensure the long-term success of Fijian rugby.
