A federal court judge has disqualified three former directors of Youpla Group, the collapsed funeral fund that sold junk insurance to Aboriginal families, and ordered them to pay a combined $90,000 for breaching their duties to members.
Justice Geoffrey Kennett handed down the orders on Wednesday, disqualifying Jonathan Law from managing corporations for six years and ordering him to pay $50,000, disqualifying Michael Wilson for 10 years and ordering him to pay $20,000, and disqualifying Geoffrey Clayton for five years and ordering him to pay $20,000. The three were also ordered to pay a combined $17,000 towards the plaintiff's costs.
Kennett found the directors had failed to perform their duties with the degree of "care and diligence" expected, failed to manage conflicts of interest, and caused detriment to members of the Aboriginal Community Benefit Fund (ACBF), as Youpla was previously known.
Youpla collapsed in March 2022, leaving more than 13,000 Aboriginal people, some elderly and in palliative care, without the means to pay for funerals. Families resorted to crowdfunding and some were forced to leave loved ones' bodies in the morgue while raising funds. The Australian Securities and Investments Commission (ASIC) began proceedings against five former directors and officers in August 2023, alleging governance failures and director misconduct affecting First Nations members. ASIC alleged the directors maintained insurance arrangements with Crown Insurance, a Vanuatu-based company owned and controlled by Pattenden and Law, and did not act in the best interests of the funds.
The latest orders follow a judgment late last month in which founder Ron Pattenden was ordered to pay $250,000 and banned for 15 years after acknowledging he had breached directors' duties in a settlement with ASIC. Former Youpla Group chief Bryn Jones was found by Kennett to have breached his directorial duties after a contested liability hearing in February; he denied having knowledge of the fund's insurance premium increases, and his penalty will be set at a later hearing.
Youpla sold junk funeral policies to Indigenous people for decades, targeting communities where English was not the first language and communities with low literacy levels, using marketing materials in the Aboriginal flag's colours, stuffed toys, colouring books and door-to-door sales. Its conduct was exposed in the 2018 banking royal commission and its licence to sell new products was withdrawn; ASIC questioned its solvency in 2021 and the company's directors finally pulled the plug. The federal court fined Youpla $1.2 million in September 2023 for misrepresenting the policies, but the company avoided paying millions more in fines handed down in July 2025 because it was in liquidation.
A $97 million federal government support package was announced in February 2024 to help thousands of mostly low-income Aboriginal families recover from financial loss. Government payments to remaining victims will continue to be processed until 1 December this year, with eligible recipients able to choose a funeral bond or a cash payment worth 60% of the value of their policy.
Analysis
Why This Matters
- The collapse left more than 13,000 Aboriginal people, including elderly and palliative care patients, without funeral funds, forcing families to crowdfund or leave bodies in morgues.
- The penalties hold directors personally accountable for governance failures and conflicts of interest in a company that targeted low-literacy and non-English-speaking communities.
- The federal government's $97 million support package is still paying out, with claims accepted until 1 December this year.
Background
Youpla, formerly the Aboriginal Community Benefit Fund, sold funeral insurance to Indigenous communities for decades using marketing tied to the Aboriginal flag, toys and colouring books. Its conduct was exposed by the 2018 banking royal commission, its licence to sell new products was withdrawn, and it collapsed in March 2022. ASIC has pursued its former directors and officers since August 2023.
Key Perspectives
- Justice Geoffrey Kennett: found the three directors failed to perform their duties with the degree of "care and diligence" expected, failed to manage conflicts of interest, and caused detriment to members.
- ASIC: alleged the directors maintained insurance arrangements with Crown Insurance, a Vanuatu-based company owned and controlled by Pattenden and Law, and did not act in the best interests of the funds.
- Ron Pattenden: acknowledged breaching directors' duties in a settlement with the regulator.
- Bryn Jones: denied having knowledge of the fund's insurance premium increases; his penalty is yet to be set.
What to Watch
- Bryn Jones's penalty, to be determined at a later hearing.
- Whether remaining victims claim support payments before the 1 December deadline.
- How many eligible recipients choose a funeral bond over the 60% cash payment.
Checked
12 claims in this story checked against 1 source: 12 supported.
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- SupportedThree Youpla directors were banned and ordered to pay a combined $90,000 over the collapsed fund.Australia news | The Guardian: “Three directors of a collapsed funeral fund that marketed insurance to Aboriginal families have been banned from managing corporations for at least five years and ordered to pay a combined $90,000 after being found to have breached their duties to clients.”
- SupportedThe court found that former directors breached duties to Aboriginal members.Australia news | The Guardian: “Kennett found they had failed to perform their duties with the degree of “care and diligence” expected, failed to manage conflicts of interest, and caused a detriment to the ACBF members.”
- SupportedFounder Ron Pattenden had already been barred for 15 years.Australia news | The Guardian: “the founder of the company, Ron Pattenden, was ordered to pay a quarter of a million dollars and barred from managing corporations for 15 years.”
- SupportedYoupla was a collapsed fund that sold junk funeral insurance to Aboriginal families.Australia news | The Guardian: “Youpla sold junk funeral policies to Indigenous people across Australia for decades”
- SupportedKennett found the directors failed to meet the expected standard of “care and diligence”.Australia news | The Guardian: “Kennett found they had failed to perform their duties with the degree of “care and diligence” expected”
- SupportedJonathan Law was disqualified for six years and ordered to pay $50,000.Australia news | The Guardian: “Jonathan Law, to pay the commonwealth $50,000 and disqualified him from managing corporations for six years.”
- SupportedMichael Wilson was disqualified for 10 years and ordered to pay $20,000.Australia news | The Guardian: “Michael Wilson, also a director, was ordered to pay $20,000 and disqualified from managing corporations for 10 years”
- SupportedGeoffrey Clayton was disqualified for five years and ordered to pay $20,000.Australia news | The Guardian: “while director Geoffrey Clayton was ordered to pay $20,000 and disqualified from managing corporations for five years.”
- SupportedThe three directors were ordered to pay a combined $17,000 towards the plaintiff’s costs.Australia news | The Guardian: “The trio were also ordered to pay a combined $17,000 towards plaintiff’s costs.”
- SupportedYoupla collapsed in March 2022, leaving more than 13,000 Aboriginal people without the means to pay for funerals.Australia news | The Guardian: “It collapsed in March 2022, leaving more than 13,000 Aboriginal people, some elderly and in palliative care, without the means to pay for funerals.”
- SupportedASIC began proceedings in August 2023 against five former directors and officers, alleging governance failures and misconduct affecting First Nations members.Australia news | The Guardian: “In August 2023, Asic commenced proceedings in federal court against the five former directors and officers for breaches of their duties, alleging governance failures and director misconduct that affected the First Nations people who were members of the funds.”
- SupportedA $97 million government support package was announced in February 2024 to help Aboriginal families recover financial losses.Australia news | The Guardian: “A $97m federal government support package was announced in February 2024 to help thousands of mostly low-income Aboriginal families recover from financial loss.”