funeral insurance fund, aimed at Indigenous consumers, collapses leaving thousands out of pocket

Funeral insurer, aimed at Indigenous consumers, collapses leaving thousands out of pocket

The Government has been called to step in to assist First Nations families who lost money to a funeral insurance fund which seemed to be Indigenous owned and created.

Ngemba woman, and Greens candidate for Parkes Trish Frail spoke in Dubbo today about the collapse of Youpla Group.

Greens NSW Senate candidate David Shoebridge stood alongside Frail, seeking feedback from First Nations people who have lost thousands by the collapse of the company.

Non-Indigenous group targeting First Nations people

For decades, Youpla Group, which also went by the name of the Aboriginal Community Benefit Fund (ACBF), sold funeral insurance marketed solely to First Nations people.

After coming under scrutiny by the Australian Securities and Investment Commission (ASIC) in 1999, 2004 and 2020, ACBF changed its name to ‘Youpla’.

In 2017, just prior to the Royal Commission into Misconduct in the Banking, Superannuation and Financial Services Industry, Vanuatu-based founder, major shareholder and non-Indigenous person Ron Pattenden hired the non-indigenous Bryn Jones to represent the firm at the Royal Commission.

Following the Commission in 2018, Indigenous businessman Isaac Simon bought the company alongside Jones, holding equal 50% shares.

Labor MP Dr Andrew Leigh asked Simon if the company was majority owned or staffed by Aboriginal people.

“It would be accurate to say, not majority,” said Mr Simon. “But not accurate to say that Aboriginal and Torres Strait voice was not equal”.

Funeral insurer, aimed at Indigenous consumers, collapses leaving thousands out of pocket (2)
A statement which now sits at the bottom of the company’s website.

Funeral insurance fund group prayed on First Nations communities

Greens Candidate for Parkes, Ngemba woman Trish Frail

Trish Frail said Youpla preyed on vulnerable communities.

“They built trust with their name and then took money from vulnerable people,” she said.

“We’re not talking about people with big incomes, they were taking money from some policy holders that would have been equal to about 25% of their small income.”

David Shoebridge said the Morrison government ignored community organisations that highlighted the need for assistance.

“Regardless of who wins the May election, the Greens will be working with community to develop a comprehensive policy to assist up to 15,000 First Nations people who have been robbed of their savings and peace of mind with the collapse of Youpla,” Shoebridge said.

 “What is so frustrating about this is it was so predictable,” Shoebridge said.

“The Royal Commission into the Banking industry told the government this was a dangerously unregulated industry preying on vulnerable client.”

Funeral insurance fund: Misrepresentations, low-value coverage

In dozens of cases the ombudsman found that ACBF misrepresented itself as an Aboriginal-owned and controlled not-for-profit, community organisation serving the Aboriginal and Torres Strait Islander community.

ACBF was found to have sold vulnerable Aboriginal people low-value funeral insurance, including cover for children and babies. However, people allegedly paid more over time than the policies were worth.

Wiradjuri woman, Beverly Roberts joined one of Youpla’s funds in 1994, soon after she’d lost 4 family members in the space of a year and experienced the difficulty of providing a respectful and timely funeral and burial. She covered herself and close family members, most recently paying the funeral fund up to $87 a fortnight.“Who’s going to pay for my funeral now? All that money is gone and I’m so wild about it.”

“When I joined twenty eight years ago I wasn’t a diabetic, and I didn’t have leukemia. Now that I have those diseases, what are my chances of another funeral fund covering me? None!”

“The fund didn’t even bother letting me know, I just heard a rumor on social media and I’d already let an extra payment go through.”

Marketing likely misled consumers into Indigenous involvement

The Group used marketing materials with Aboriginal art and designs. They also attended First Nations community events like the annual Koori Knockout rugby league competition.

Commissioner Kenneth Hayne was scathing of the company’s conduct in his interim report. He expressed concern the company possibly breached the ASIC Act.

“I consider that ACBF may have breached its obligations … to not engage in conduct that is misleading or deceptive, or is likely to mislead or deceive,” the report said.

“ACBF’s marketing materials as a whole, and specifically ACBF’s statements about its dedication to the Aboriginal community, may convey a representation that ACBF has the approval or endorsement of the Aboriginal community in a general sense.”

Policy holders tried to protect families from debt

Frail emphasised that policy holder thought they were doing the right thing. They were just trying to protect their families from the expenses and possible debt of funerals and end-of-life costs.

“We all struggle financially when we have to deal with Sorry Business, so we do the right things and sign up to protect ourselves,” she said.

“Instead of protection we get ripped off.”

“Why has no government been able to fix this shonky business in over 30 years? If it was an non-Aboriginal community that was being ripped off I’m sure there would have been legislation put into place by now.”

The Youpla Group entered liquidation in March this year. Youpla comprised of four active funeral contribution funds:

  • The Aboriginal Community Benefit Fund (Fund No. 1)
  • Aboriginal Community Benefit Fund No 2 (Fund No. 2)
  • Aboriginal Community Funeral Plan (Fund No. 3 )
  • Community Funeral Plans (Fund No. 4)

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O’Brien Criminal & Civil Solicitors
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Sydney NSW 2000

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