Third person pleads guilty in $180m Ponzi scheme

David Sipina of Croydon, NSW, has pleaded guilty to two criminal charges relating to his role at the Courtenay House group of companies.

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).
• One count of dealing in the proceeds of crime worth $1 million or more pursuant to section 400.3(1) of the Criminal Code.

According to the Australian Securities and Investments Commission (ASIC), the Courtenay House group offered returns to investors based on representations that their funds would be traded in the Forex and Futures markets.

The regulator alleged that approximately 585 investors contributed over $180 million to the scheme but only a fraction of the funds was actually traded. Instead, the majority of new investor funds were used to repay earlier investors, a fraudulent arrangement known as a Ponzi scheme.

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, however, ASIC said it is not alleged that Sipina was aware the business was a Ponzi scheme.

He 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, Sipina was committed to the Sydney District Court for sentencing, which will occur on a date yet to be fixed. His 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A related charge of engaging in dishonest conduct in relation to a financial product or service was withdrawn following Sipina pleading guilty to the other charges.

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.

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, Papoulias was ordered to complete 120 hours of community service.

Former director of the Courtenay House companies, Tony Iervasi, has also 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.