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Court finds Youpla misrepresented itself as an Aboriginal-owned or managed company

Dechlan Brennan -

The collapsed funeral fund Youpla misrepresented itself as Aboriginal owned or managed, the full Federal Court ruled on Thursday.

The Youpla Group schemes, previously known as the Aboriginal Community Benefit Fund (ACBF), sold junk funeral insurance plans to Indigenous people across Australia for over 30 years before failing in 2022.

This despite consistent concerns raised by First Nations groups, along with financial, legal and consumer organisations.

When it failed in 2022, it left thousands of mainly low-income Aboriginal families unable to pay for their funerals.

According to the Australian Securities and Investments Commission (ASIC) who pursued the case, customers bought the plans through the payment of fortnightly premiums so family members would be covered for their funeral expenses.

It was the only funeral fund granted access to the Centrepay system - an automatic deduction from welfare payments set up by the Howard government in 2001 - which enabled First Nations people to make automatic payments for essentials like rent or food.

Previously, a judge fined the company $1.2 million for falsely telling plan holders that they would receive a lump sum payment for their chosen benefit amount. Last year, the court found the scheme was only designed to reimburse funeral-related expenses up to the benefit amount, and only then after proving those expenses had been incurred.

The company would often go door to door selling its product, as well as running misleading advertisements. In 2018, the banking royal commission found ACBF had engaged in conduct "below community standards" in several aspects, including that it relied on the cultural significance of funerals to Indigenous people to advertise its policies.

The decision handed down on Thursday was triggered by an ASIC appeal, who said they did so "after consulting with First Nations advocate groups and because of the harm that we believed the ACBF and Youpla business had caused to Aboriginal peoples".

ASIC deputy chair, Sarah Court, said on Thursday the decision "provides some formal acknowledgment of that harm and will be a deterrent to anyone who tries to mislead Aboriginal consumers about whether a business is Aboriginal owned or managed".

The judgement found ACBF to have engaged in conduct that was misleading.

In its findings, the full court said: "[B]y representing during the Relevant Period, in the course of offering, promoting and selling the Aboriginal Community Funeral Plan, that ACBF was owned or managed by an Aboriginal person or person, ACBF engaged in conduct…that was misleading or deceptive or likely to mislead or deceive."

The full Federal Court's decision overturns part of an earlier Federal Court ruling, which had found whilst ACBF had represented itself and First Nations-owned and operated, ASIC didn't prove this representation to be false.

The proceeding will now go to a trial judge to consider an appropriate penalty.

ASIC has also launched civil proceedings in the Federal Court against five former directors and officers of the Aboriginal Community Benefit Fund for alleged breaches of their duties.

Ms Court previously said the civil case "seeks to hold to account those involved in the alleged governance failures and director misconduct that impacted the First Nations people who were members of the funds".

ASIC has argued the directors and officers of ACBF maintained insurance arrangements with Crown, a Vanuatu-based company that was beneficially owned and controlled by defendants Ron Pattenden and Jonathan Law. It is argued these arrangements were not in the interest of ACBF, instead standing to benefit Pattenden and Law.

Furthermore, ASIC alleges insuring with Crown left customers vulnerable to unaffordable premium increases with Indigenous people continuing to make premium payments to ACBF whilst being unaware of the risks to the viability of the funds.

Last month, the federal government announced an "enduring resolution" for victims of the scheme, which is expected to help more than 13,000 people recover from financial loss and provide certainty to families.

People can register to receive updates and more information about the new Youpla Support Program by visiting or contact the National Indigenous Australians Agency on 1800 079 098.


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