Allegations against convicted paedophile Steven Larkins during his time as a scouts leader were "common knowledge" among people in senior positions at Scouts NSW for years before his eventual arrest and conviction, a witness told the first public hearing of the royal commission into institutional responses to child sexual abuse in Sydney.

Larkins was jailed in 2012 over charges relating to sexual abuse, child pornography and the forgery of documents for an application granting him permission to work with children.

This week's hearing will examine the responses of the Department of Community Services (Docs), the Commission for Children and Young People, Scouts Australia's NSW branch and Hunter Aboriginal Children's Services (Hacs) to reports of Larkins' conduct.

On Monday the commission heard from several witnesses, including two men who were assaulted as children by Larkins in 1992 and 1997 while they were under his care at scouts events – referred to as witnesses AA and AC – and the mother of AC, referred to as AB.

Larkins was reported to police in April 1997 after he was seen outside Stockton pool handing out lollies to children and inviting them to join a scouts group. It was not the only report of suspicious behaviour by Larkins that was allegedly known to scout leaders.

A former group leader for Scouts Australia, Armand Hoitink, also appeared before the commission, saying Larkins's behaviour was "common knowledge".

Hoitink said district and regional commissioner Des Hocking knew of allegations and rumours beyond the incident at the pool, including that Larkins was naked in the showers with scouts and had climbed into a sleeping bag with a young boy who had been swimming in cold water and claimed it was to warm the boy up.

He described one incident when he asked Hocking what they were going to do about the allegations. Hoitink claims Hocking replied "nothing".

"It was all about protecting scouts," said Hoitink.

Hoitink told the hearing that after he received a call about Larkins at Stockton pool in April 1997 he called police, who said they would "keep an eye on him".

He also called head office and spoke to scout leader William Metcalfe, he said, and claims he was told that he "should have contacted scouts first rather than the police and let them handle it".

"I said to him, 'Sorry, my first duty of care is to the kids and the parents who trust me to look after their children, not to the scouts association,'" said Hoitink.

Hoitink said that in 1997, when visiting Sea World with his wife at the same time as a scouts event, he saw Larkins in charge of a group of seven to 10 children. "I was stunned to see that here he was again," said Hoitink.

Hoitink said he called scout leader William Metcalfe to ask why Larkins was still in charge of children and was told "we promised him that he would go".

"My wife and I resigned from scouts after that in early 1998 in protest," he said.

Metcalfe and Scouts Australia disputed several aspects of Hoitink's account, including the dates of Hoitink's resignation and the content of conversations with Metcalfe.

Metcalfe, who appeared before the hearing immediately after Hoitink, said he hadn't "had one word from Armand at all in any way shape or form".

Metcalfe said he was unaware at the time of allegations that Larkins had climbed into a sleeping bag with a young boy who had been in cold water. He said such action from a scout leader was known to be "not on, definitely a no-no".

Reading from a statement via videolink, AA told the hearing that he had felt "belittled, dirty, wrong and confused" after he was assaulted by Larkins at age 12 while staying at Larkins' parents' house. He thought he'd done something wrong and so told no one. AA continued to attend scouts events where Larkins was present, which only served to exacerbate his trauma.

In 2000 AA visited a house connected to his employment in a youth centre for students with behavioural issues. He saw Larkins at the house and was told that Larkins was a residential support worker, living and working at the centre in a caring capacity for children. AA was "flabbergasted" and was prompted to tell his partner of his own experience.

AA saw Larkins again at another scouts event and told another scout leader of his abuse, who directed him to Hocking. AA told the hearing that senior scout leaders came to his house and organised a meeting with police. He heard from police again in 2001 and was told that someone else had come forward with allegations, witness AC. AA said he expected to attend court over the matter. He next heard from police in 2012 that Larkins had pleaded guilty.

AC met Larkins at his first scouts meeting, he informed the hearings through a statement read out from the bar table. The next weekend Larkins picked up AC and another scout and took them to a second scouts event, said AC, where he was asked to apply sunscreen to the back and chest of another Scouts leader "who seemed to enjoy it" and made moaning noises while Larkins watched.

At the age of 11 AC was sexually assaulted by Larkins while staying at Larkins' house with other scouts. Larkins had set up mattresses in his own room and told AC he would sleep next to him. "I was starting to get a bit worried because he was getting a bit too close to me," said the statement. When Larkins assaulted AC, AC said he froze, then told the scout leader to "fuck off" before running away and locking himself in the bathroom for the night.

"I felt dirty and I felt it was all my fault," said AC. He did not tell his family and began behaving badly towards his brother and mother and falling behind in school, AC's mother told the hearing.

AC had no contact with Larkins until the scout leader phoned him a few months later. AC yelled at Larkins and hung up. It was then that he told his mother, who revealed that she, too, had been abused as a child. They went to the police and told them what happened. "After leaving the police station that was the last I heard from the police at Newcastle," said AC.

"At no time was I contacted by any member of the scouts."

However, according to the opening statement from senior counsel assisting the commission, Gail Furness, about 12 months after AC's mother informed the police of her son's abuse one of the investigating officers, senior constable Pamela Amloh, incorrectly told another officer that the DPP had advised that a prosecution was unlikely to go ahead. The commission heard that six months later AC's mother told police that her son no longer wanted to go ahead with the prosecution and it was likely this was because of "delay and the initial misinformation".

AC's mother gave up custody of both her children.

"Even though I had custody I just couldn't take it anymore. I was run ragged," she said in her own statement.

Amloh is due to give evidence on Tuesday or Wednesday.

The hearing began with an opening address from Justice Peter McClellan AM, who spoke of the scope of the commission and the overwhelming response already received. To date, the commission has received 4,301 phone calls relating to allegations of abuse. An average of 22 people a day call the hotline set up specifically for the commission, and McClellan said they expected at least 10 of them would need a private session with a commissioner to tell their story.

During private sessions held in Sydney, Brisbane, Adelaide, Perth, Canberra and Melbourne, 398 people have so far shared their story with a commissioner. Another 449 are waiting to, and 1,178 are yet to be assessed for private sessions. The private sessions are a lengthy process. Planned in consultation with a psychiatrist, the sessions are restricted in time and number to protect the mental wellbeing of both the victims telling their story and the commissioners hearing it.

"In my role as a judge I have been called upon to review many of the sentences imposed upon people convicted of the sexual abuse of children, but until I began my work with the commission I did not adequately appreciate the devastation and long-lasting effect which sexual abuse, however inflicted, can have on an individual's life," said McClellan in his opening address.

The commission continues.