Former director and contractor charged over alleged Ponzi scheme

Tony Iervasi and Athan Papoulias appeared in the Downing Centre Local Court on Tuesday (30 November), charged with criminal offences for their actions relating to an alleged Ponzi scheme.

According to an ASIC statement, Mr Iervasi, the sole director and shareholder of Courtenay House and Courtenay House Capital Trading Group (both in liquidation), is facing nine criminal charges of dishonest conduct and one charge of carrying on a financial services business without a licence.

If found guilty, Mr Iervasi faces possible imprisonment of between five and 10 years for dishonest conduct and up to two years for operating without a financial services licence. 

Mr Papoulias, a contractor engaged by Courtenay House Capital Trading Group to promote the Courtenay House business, is facing one charge of dealing in the proceeds of crime worth $1 million or more, and one charge of aiding and abetting Mr Iervasi. The maximum penalty for dealing with the proceeds of crime is 25 years’ imprisonment.

The charges relate to around 590 investors who paid over $196 million into the Ponzi scheme.

ASIC alleged that, between October 2010 and 21 April 2017, Mr Iervasi and the Courtenay House companies represented to investors that their funds would be traded in the forex and futures markets when only a small proportion of funds were traded.

Moreover, ASIC found that Mr Iervasi personally, and through the Courtenay House companies, acquired investor funds and did not invest them for the intended purpose and went on to pay monthly amounts to investors representing they were returns from trading, when little to no trading had occurred.

Mr Iervasi was also found to have been operating an unlicenced financial services business, which Mr Papoulias continued to promote despite becoming aware of the circumstances.

ASIC also established that Mr Papoulias dealt with money or other property that could be the proceeds of crime.

ASIC alleged the conduct occurred to allow a Ponzi scheme to operate and grow.

The matter is listed for first mention in the Downing Centre Local Court in Sydney on 22 February 2022.