ASIC court action finds former Youpla directors breached duties in funeral insurance case

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ASIC finds Youpla directors breached duties

Highlights

Bryn Jones and Ronald Pattenden, former Youpla directors, were found to have breached their duties, with Pattenden fined A$250,000 and disqualified for 15 years.
ASIC alleged that insuring with Crown Insurance Services Limited, owned by Pattenden and Law, exposed ACBF entities to unaffordable premium increases in September 2017, harming fund viability.
Youpla Group's collapse led to the ACBF entities' liquidation in March 2022, ASIC court proceedings in August 2023, and the government's Youpla Support Program applications open until 30 June 2026.

Court findings and pending penalties

As reported by ASIC, former Youpla Group CEO Bryn Jones and director Ronald Pattenden have been found to have breached their duties as directors of Youpla Group companies.

Pattenden has been ordered to pay A$250,000 in penalties and has been disqualified from managing corporations for 15 years, in line with a proposal by ASIC and Pattenden. After a contested liability hearing in February 2026, the court also found that Jones breached his duties as a director.

A separate hearing, on a date yet to be fixed, will determine what penalties Jones will face. ASIC began proceedings in 2023 against Jones, Pattenden and three other directors, Jonathan Law, Michael Wilson and Geoffrey Clayton, over alleged breaches of directors' duties linked to Youpla.

The decisions regarding Law, Wilson and Clayton remain reserved. ASIC Chair Sarah Court says misconduct targeting First Nations people remains an enduring enforcement priority for the regulator and says the agency is committed to holding those responsible to account and protecting vulnerable consumers at risk.

Impact on First Nations communities and fund members

Youpla operated several funeral insurance funds that were marketed mostly to Indigenous Australians. ASIC's case alleges that between September 2017 and November 2018, the directors and officers maintained insurance arrangements with Crown Insurance Services Limited, a Vanuatu-based company beneficially owned and controlled by Pattenden and Law.

According to ASIC's allegations, those arrangements were not in the interests of the ACBF entities and stood to benefit Pattenden and Law. The regulator also alleges that insuring with Crown left the ACBF entities exposed to unaffordable premium increases that occurred in September 2017, while First Nations customers continued making premium payments without awareness of the risks to the funds' viability and their ability to meet commitments.

In March 2022, the ACBF entities entered liquidation, and ASIC launched Federal Court proceedings against five former Youpla directors and officers in August 2023. The government later established the Youpla Support Program in 2024 in response to hardship and trauma caused by the group's collapse, with applications closing on 30 June 2026 and payments continuing to be processed until 1 December 2026.

The liquidation process is being managed by SV Partners. ASIC says it will provide further comment after the hearing on Jones' penalties concludes and once decisions are handed down for the remaining three former directors.

In our earlier article on a Malaysian Court of Appeal ruling, we covered how a lawyer holding commission-partner status at a law firm was found personally liable for an unpaid balance from a property sale. We noted that the court overturned earlier decisions and clarified that salaried or commission-based partners can be treated as partners under the Partnership Act 1961, potentially widening exposure to firm debts and wrongdoing tied to business conduct.

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