Cape Town - Former Sharks CEO Brian van Zyl has penned a hard-hitting open letter in which he suggests that the union is in a position that is "approximating insolvency".
The letter was published in Friday's edition of The Mercury.
Van Zyl was replaced as Sharks CEO by Springbok 111-Test veteran John Smit in 2013.
News broke late last month that Smit would be stepping down from his position at the end of the 2016 season, with the former Springbok captain citing family time as his main motivating factor.
But Van Zyl has launched a scathing attack on Smit, suggesting that the union had lost money under his leadership.
"I am concerned as it appears that although The Sharks have dire financial problems, which have become manifest over the last three years, there seems to be no culpability," Van Zyl wrote.
Van Zyl added that, as far as he was aware, there had been no official release of financial numbers for 2015 and that during 2013 and 2014 the union had "an accumulated deficit of more than R40 million".
Van Zyl also hit out at the appointment of Smit back in 2013, saying that he had not been consulted in the decision and that the appointment "was not the product of a rigorous process".
The Sharks, through KZNRU president Graham Mackenzie, hit back at Van Zyl's comments on the IOL website.
"It is simply wrong to suggest the Sharks are financially unstable. As Brian very well knows, each of the provincial unions faces significant financial challenges and these problems pre-date his departure," Mackenzie said.