The sacking comes days after then-chief executive of Catholic Schools NSW Dallas McInerney gave evidence over three days at a NSW anti-corruption inquiry.
The probe is examining allegations that he potentially broke NSW donation laws by directing money to a right-wing, religious faction of the NSW Liberal party.
Mr McInerney told the commission he had wiped his phone and iPad before his final day of giving evidence, doing so after finding his bank account had been blocked and his ApplePay had been rejected.
In a statement on Friday, the Catholic Schools NSW board said it had lost confidence in Mr McInerney's ability to lead the organisation.
The matters at the centre of the inquiry were of deep concern to the organisation and its stakeholders, they said, despite the fact the probe heard it was not responsible for or aware of the alleged conduct.
During hearings on Friday, former NSW Liberal police and transport minister David Elliot began giving evidence in the inquiry.
He told the commission he saw a private investigator parked on his street after he wrote a letter in February 2020 to then-NSW planning minister Rob Stokes opposing a proposed development in Western Sydney.
Mr Stokes said he knew the fugitive property developer behind the project - Jean Nassif - was responsible for the surveillance, describing it as invasive but comical.
"(The private detective) was monitoring the wrong house ... I hope they weren't paying too much," Mr Elliot said.
Mr Elliot said Nassif "went nuts" after he opposed his development, leaving him a threatening voicemail and approaching him a number of times in public.
Nassif also threatened the former MP's chief of staff with what he said was a compromising photo of Mr Elliot firing a sub-machine gun at a correctional centre, the commission heard.
The photo formed part of a salacious "David Elliott shit sheet" which the commission was told about in July, prepared by Liberal staffer Dylan Whitelaw.
Mr Elliot said he was contacted by a journalist from News Corp about the photo, but said he had no issue with its publication and he had not been trying to hide it.
"I was there in a ministerial capacity, firing a weapon because I was opening a rifle range, which corrections had just refurbished," he said.
The inquiry is probing allegations Liberal operatives took donations in return for furthering Nassif's interests, including harming Mr Elliott's reputation.
Mr Whitelaw earlier said he was told to prepare the document, which was also said to have contained allegations of an extramarital affair, by Liberal-affiliated lobbyist Jeremy Greenwood.
He accepted it could have furthered the interests of developer Jean Nassif.
However, Mr Greenwood told the inquiry it was not created to help Nassif gain political leverage, but instead defended him from attacks he faced from the then-police minister.
A lawyer for Mr Elliott later established the pair had not met.
Mr Elliott also released a statement rejecting "all accusations made by the young boy Dylan, and his colleagues on the religious right of the Liberal Party", in response to the sheet.
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