The government confirmed this week Dinesh Perera, whose former rank wasn't disclosed, is acting operations manager for the center set up last year on Manus Island.
The center on Manus, a rugged jungle-covered island off Papua's northern coast, houses asylum seekers who attempt to reach Australia by boat.
Perera works for private global security firm G4S, which the government contracted to run the controversial off-shore processing center where riots this month claimed the life of one asylum seeker.
The detainees, many from Asian countries including Afghanistan, Sri Lanka, Iraq and Iran, have been rescued from unseaworthy vessels after paying people traffickers for a perilous voyage to Australia.
"The facility has consistently been called cruel and inhumane by the U.N. High Commissioner for Refugees," Emily Howie, an advocate at Human Rights Law Center, told the Australian Broadcasting Corp.
"Over the past week, there's been a death at the facility and many injuries. The only responsible option is to close this facility."
Howie, who specializes in international refugee issue and has done research in Sri Lanka on human rights abuses, said there is "no peace of mind" even if Perera has passed scrutiny by the government.
HRC, an independent not-for-profit non-government organization, is concerned the ethnic Sinhalese former military officer is overseeing ethnic Tamils.
Tensions remain high in Sri Lanka after the bloody 26-year conflict ended in 2009 when the Sri Lankan army, consisting mostly of Sinhalese, defeated the Liberation Tigers of Tamil Eelam.
As many as 100,000 people are thought to have been killed in the war in which the Tamil Tigers fought a guerrilla campaign to create an independent Tamil state.
Australian activists estimate about 30 of the 1,300 refugees at Manus Island are ethnic Tamils from Sri Lanka.
"For the same reason we don't want ex-members of the Taliban employed there, we don't want ex members of the Sri Lankan military," Howie said.
"Its entirely inappropriate that someone with a military background from one of the source countries for refugees would be put in a position where they have care and protection of vulnerable asylum seekers who may well have been fleeing that military."
ABC reported a spokesperson for the Australian Minister for Immigration Scott Morrison saying contracts with G4S and other service providers at offshore centers contain clauses requiring vetting, including clearance by Australian Federal Police.
The Perera controversy is the latest to hit the government's strategy in dealing with hundreds of would-be refugees arriving by boat each month.
Australia's Human Rights Commission opened an inquiry this month into the government's detention of children arriving on asylum-seeker boats.
HRC President Gillian Triggs said the inquiry -- the second in a decade -- would review the impact of detention on the health, well-being and development of an estimated 1,000 children in mainland Australia and 100 in an offshore detention center on the island republic of Nauru.
Australian government policy, supported by opposition parties, is not to allow asylum seekers into mainland Australia, but resettle them in third countries.
Australia's territorial waters are patrolled by the recently established Operation Sovereign Borders, an amalgamation of the 12 agencies involved in border protection into one agency led by a single three-star military commander.
The force has been turning boats back into international waters in the direction from where the vessels came.
The Age newspaper reported Tuesday the Liberal coalition government of Tony Abbott has spent $2.5 million on 12 large enclosed ocean survival lifeboats to send asylum seekers intercepted at sea back to Indonesia.
The figure was revealed in letters tabled in the Senate by Assistant Immigration Minister Michaelia Cash, The Age reported.
Each lifeboat -- to be used once -- costs around $200,000. Fairfax Media, owner of The Age, said the government has used at least three of the 12 boats.
Abbott's government has hit out at media, including ABC, accusing outlets of biased reporting.
ABC posted a notice on its website Feb. 4 defending its reporting, saying it "makes no apologies" for covering the issue of turning around the boats and covering allegations by refugees of abuse at the hands of Australian naval authorities.
"ABC hasn't attempted to play judge and jury on this matter," the notice reads.
"We have reported the asylum seeker claims, broadcast the video showing burns and consistently sought more detail from witnesses and officials.
"Our journalists will continue to investigate and cover this story and we will continue to urge Australian authorities and the government to disclose more to the Australian public about the events on board those boats."