David Sipina of Croydon NSW has pleaded guilty to two criminal charges relating to his role at the Courtenay House group of companies.
Mr Sipina appeared before the Downing Centre Local Court on 19 March 2024 and pleaded guilty to:
- one count of carrying on (with others) a financial services business without a license pursuant to section 911A of the Corporations Act 2001 (Cth); and
- one count of dealing in the proceeds of crime worth $1 million or more pursuant to section 400.3(1) of the Criminal Code.
The Courtenay House group offered returns to investors based on representations that their funds would be traded in the Forex and Futures markets. ASIC alleges that approximately 585 investors contributed over $180 million to the scheme but only a fraction of the funds were actually traded. Instead, the majority of new investor funds were used to repay earlier investors, a fraudulent arrangement known as a Ponzi scheme.
Mr Sipina has pleaded guilty to carrying on an unlicensed financial services business between 24 June 2015 and 21 April 2017. His role included referring new investors and marketing the business. It is not alleged that Mr Sipina was aware the business was a Ponzi scheme.
Mr Sipina has also pleaded guilty to dealing with money which was, and which he believed to be, the proceeds of crime, in the form of commissions he received for promoting investments in Courtenay House despite it being unlicensed.
Upon pleading guilty to the charges, Mr Sipina was committed to the Sydney District Court for sentencing, which will occur on a date yet to be fixed. Mr Sipina's first appearance before that Court will be on 19 April 2024.
A related charge of engaging in dishonest conduct in relation to a financial product or service was withdrawn following Mr Sipina pleading guilty to the other charges for which he is to be sentenced.
The matter is being prosecuted by the Commonwealth Director of Public Prosecutions after an investigation and referral by ASIC.
Mr Sipina is the third person to plead guilty to criminal charges relating to Courtenay House.
On 8 May 2023, former Courtenay House contractor, Athan Papoulias, was sentenced to two years' imprisonment, to be served by way of an intensive corrections order for his role in the unlicensed financial services business. As part of his sentence, Mr Papoulias was ordered to complete 120 hours of community service (23-118MR).
Former director of the Courtenay House companies, Tony Iervasi, has pleaded guilty to charges relating to operating the Ponzi scheme. The sentencing hearing will be on 22 and 24 April 2024 in the Supreme Court of NSW (22-307MR).
Background
Mr Sipina was first charged on 21February 2023 (23-036MR).
The maximum penalty at the time of the offending for carrying on a financial services business without an Australian Financial Services license was two years' imprisonment, a fine of $34,000, or both. For dealing with the proceeds of crime, believing it to be proceeds of crime, the maximum penalty is 25 years imprisonment, a fine of $204,000, or both.
On 16 May 2017, the Supreme Court of NSW made orders to wind up and appoint liquidators to the Courtenay House companies (Courtenay House Key Matters page).
On the application of ASIC, the Supreme Court of NSW made interim orders on May 1, 2017, against Tony Iervasi, Athan Papoulias, David Sipina, Courtenay House, Courtenay House Trading Group, and others. These orders prevented those parties from carrying on a financial services business in Australia and limited the extent to which they could deal with their cash and other assets. ASIC sought these orders to preserve funds that might be available for the benefit of investors who had incurred losses and to prevent the companies from accepting further funds from investors (17-127MR).
