A public inquiry is to consider whether there was interference by the Church of England in the case of jailed former Bishop of Lewes Peter Ball.
The Independent Inquiry into Child Sexual Abuse heard Archbishop George Carey failed to act on abuse claims made against Ball, 84, in 1993.
It also heard Ball had "permission to officiate" at church services, despite being cautioned for indecency.
Ball was jailed last year for abusing young men between the 1970s and 1990s.
The allegations are part of Dame Lowell Goddard's inquiry investigation into how the Church of England and other public bodies dealt with claims of abuse.
It will be the biggest in British history and is set to last for five years, with a budget of £17.9m for this financial year alone.
Lawyer Richard Scorer, who represents 17 victims of abuse, told a preliminary hearing of the inquiry that one of the victims, known as A13, reported abuse by Ball to the then Archbishop George Carey, but the complaint was not passed to police.
Mr Scorer said this was one reason why it took more than 20 years to bring Ball fully to justice.
This victim was in his early 20s at the time, not a child, and has been refused "core participant status" at the inquiry.
He is among several victims appealing against this decision.
Ben Emmerson, counsel to the inquiry, said there had been "many incidents of sexual abuse within the Anglican Church over a long period of time, and there have been serious failures to acknowledge, prevent and remedy such abuse".
Previous reviews by the Church had provided a picture which was "less than comprehensive", he said.
Mr Emmerson said one major inquiry only unearthed details of 13 cases, while another, led by the judge Baroness Butler-Sloss, was misled by senior figures in the Church, requiring her to re-write a report into abuse.
BBC home affairs correspondent Tom Symonds said Mr Emmerson told the inquiry it would have to decide if the allegations are "well-founded".
To meet this test, they will either have to be true, or there must have been enough evidence to have required institutions to take action, he said.
Ball was jailed in October for 32 months after admitting abusing 18 young men across 20 years.
He abused most of his victims while he lived in East Sussex and was serving as Bishop of Lewes - but would go on to carry on the abuse as Bishop of Gloucester.
Lord Carey has previously denied being involved in a cover-up.