Hepatitis Foundation former chief executive: 'Its reputation is damaged'

A two-year investigation into the charity showed the foundation splashed out on lavish dinners, flights and hotels, and could not account for missing expenses. Photo / 123RF

Written by RNZ

The $128,000 in travel expenses spent by the Hepatitis Foundation board chair could have been used to directly help people with Hepatitis C, the former chief executive says.

A two-year investigation into the charity that was kept secret for more than a year showed the foundation splashed out on lavish dinners, flights and hotels, and could not account for thousands of dollars of credit card expenses.

The investigation by government-run regulator Charities Services found excessive expenses and gross mismanagement may have occurred, though the foundation told RNZ there was no evidence of any wrongdoing.

It spent more than $128,000 on travel for its board chairperson, Chris Cunningham, in just over two years and paid for lavish dinners at top Auckland restaurants.

Former chief executive John Hornell told RNZ's Morning Report today the people feeling the impacts of the "excessive" spending the most are people in New Zealand living with Hepatitis C.

"That money could have paid for another one and a half nurses on the ground, it could have paid for another three clinical staff in the office, it could have helped ... some people with Hepatitis C when the drug wasn't funded by Pharmac."

Mr Hornell said when he started working at the foundation there was no money and it was bankrupt. He left the foundation in 2015 after 18 years - 13 of those as its chief executive.

"With careful planning and hard work we built up a portfolio, we got contracts from the Ministry of Health [and] at the time the current trustees didn't get paid for [their work]."

When the money came in, the trustees wanted a salary, Mr Hornell said.

"The dinners were launched on to the back of board meetings at the end of the year. Now, I can assure you, these were top-notch restaurants around Auckland and some in Wellington, spouses and partners of these trustees also attended these meetings."

He said he had attended the meetings and dinners, saying he always felt uncomfortable about them, but never refused to go.

He said they were attended by about 18 people.

"I was the one with the credit card that had to pay for it."

"I think some people just had their snouts so far in the trough they couldn't see the daylight, putting it bluntly.

He said it had been questioned why the chair had even attended the conferences.

"He's a non-clinical person, why does he need to go to clinical conferences?"

He said he had attended the conferences and leading expert in hepatitis Ed Gane, who was a leader on the board, also went.

"Clean as clean can be, I have no problems with Ed whatsoever. Ed didn't take any funding for anything, he would attend these international conferences, he was a leader in hepatitis globally - he had to attend these conferences off his own back."

"Why do we need other people attending? You know, there was no feedback coming back to the Hepatitis Foundation - it's okay to say 'well, you know, the fast-moving environment of hepatitis' ... well we had the leader of hepatitis field attending these meetings and he would give updates anyway around the country.

He said he had likely raised the travel expenses with Mr Cunningham.

"Probably, at the time. He just ignored it."

He said the reputation was damaged.

"I along with other peopel built the organisation up to be a very reputable organisation. I think it's damaged, I think its reputation is damaged. But first and foremost I think the people that have been damaged by this are the people living with Hepatitis B and somewhat with Hepatitis C in New Zealand."

Mr Hornell yesterday suggested Mr Cunningham should resign.

Health Minister David Clark said the report's findings were "concerning" but would not comment on whether he thought Mr Cunningham should resign.

Mr Cunningham has not responded to calls and approaches from RNZ.

- RNZ