Tuaopepe held his children above water until a rescuer arrived but was unable to save himself, Kaniva Tonga said.
Penrith resident John Savill told the Daily Mail he talked to Tuaopepe just 10 minutes before he disappeared in the water.
“He had his three kids, I think they were all around 10 years old, a year or two either side of that.”
The family was sitting on the paddleboard when they fell into the water and “panicked”, as they appeared to be unable to swim.
“By the time I got there, we got all three kids onto the paddleboard and he was less than a metre away from me and then a second later he had disappeared,” Savill told Daily Mail.
Three rescue boats and two helicopters joined the police search and the beach was closed to the public for the rest of the afternoon.
About 6.15pm emergency crews found the body of a man believed to be in his 30s.
The man-made Sydney beach had only been open one week before the drowning.
The Ministry of Foreign Affairs and Trade said: “We are aware of reports of a drowning in New South Wales, Australia. We have not been contacted by anyone for assistance.”
Tuaopepe is understood to have lived in Samoa, New Zealand and Australia.
Information on assistance available to families when a New Zealander dies overseas is available at: https://www.safetravel.govt.nz/death