Calls for government to step in over failed funeral insurance fund Youpla

Gunditjmara Wotjobaluk woman Nikki Foy was cradling her firstborn son when she first got word there was a new company offering something very valuable to her family.

“I’m home on maternity leave with this new little person who I have great responsibility for, to love and cherish,” she said.

“I’m looking at him and I hear about this Aboriginal funeral fund, which planted the seed of ‘What if something happened to me or my husband?'” She said.

A person from the Aboriginal Community Benefit Fund (ACBF) came around to explain the fund.

The paperwork was red, yellow and black.

She felt like she was speaking to people who understood her.

“I was feeling vulnerable after giving birth, so I’m just like, ‘I need to do what’s best for our son, and both my husband and I,'” she said.

“So, we signed up.”

The company used red, white and yellow colors in their paperwork, implying they were Aboriginal owned and operated.(ABC News: Amy Bainbridge)

But the company wasn’t run by Aboriginal people, despite what the promotional material implied.

And it wasn’t a simple fund to pay for funeral expenses.

It was an insurance scheme, and over the years, it has come to cost Nikki and her family tens of thousands of dollars.

Money they’re now unlikely to ever see again.

This month, a number of linked companies, all providing funeral insurance have collapsed:

  • The Aboriginal Community Benefit Fund
  • Youpla
  • ACBF Funeral Plans
  • Community Funeral Plans
  • The Aboriginal Community Benefit Fund 2

Their demise is likely to leave more than 14,500 Indigenous Australians with no cover.

The Australian Securities and Investment Commission (ASIC) said it figured out how much is owed would be complex.

But advocates estimate millions of dollars have been lost.

ASIC investigating ACBF’s insolvency

Like Ms Foy, her mother Diana Nikkelson was part of Aboriginal Community Benefit Fund 2.

The fund was the first to go under, after it went into administration in November last year.

In the past few years, Diana’s endured numerous cancer surgeries, including a stint in hospital alone as Victoria went into lockdown for COVID.

Diana Nikkelson paints a walking stick.
Diana Nikkelson, who lives with cancer, fears she will pass away and her family will not have the funds to cover her funeral.(ABC News: Amy Bainbridge)

“I feel really disappointed by the whole damn thing,” Ms Nikkelson said.

She hasn’t stopped paying into the fund in the hope that somehow she’ll still get her money.

“She thought she was doing the right thing by us, as did many other elders in our communities,” her daughter Ms Foy said.

“We took it out so we could be buried with dignity. It’s our cultural right to be buried with pride and dignity and not have to put that added pressure on our families to come up with the money to pay for our funeral.”

Nikki and Diana look over paperwork at the kitchen table.
Nikki Foy believed she was contributing to a fund and only discovered she could not withdraw her money after she’d contributed $ 12,000 in premiums.(ABC News: Amy Bainbridge)

Nikki Foy is desperate for the government to step in and do something.

“It’s not about asking for a handout and no way am I asking for a handout from government,” she said.

“I’m asking them to step in and rescue a lot of the families who have put in, including myself and my mum, to rescue… what is rightfully ours and what we’re paid into.”

Insolvency firm Robson Cotter, which is handling the demise of ACBF Fund 2, did not respond to the ABC’s request for information.

But documents seen by the ABC show there appears little chance the 3,400 members of that fund will get any money back.

A creditors meeting was told investigations were being undertaken in relation to the potential misappropriation of ACBF Fund 2’s funds.

It’s still unclear whether members of the other funds will get their money either.

“The liquidator will endeavor to contact all members as soon as possible with details of how the liquidator intends to deal with the funds and members’ claims,” ​​liquidator SV partners said in a statement.

“The liquidator will conduct an investigation into the affairs of the Youpla Group / ACBF Group and will be reporting to creditors on the outcome of those investigations.”

ASIC confirmed it is investigating the circumstances surrounding the insolvency of the ACBF funds.

The spokesperson for the commission said it was too early to say whether any action would be taken against the company or its directors.

A fund by name only

The collapse is particularly hard to swallow for Yorta Yorta community member Tracey Walsh, who stood up at the banking royal commission in 2018 to explain how she felt misled into buying a policy through ACBF because she thought it was Aboriginal owned.

Tracey Walsh stands in front of her home with her arms crossed.
Tracey Walsh took her issues with Youpla to the royal commission and Josh Frydenberg. She still stands to lose $ 10,000.(ABC News: Amy Bainbridge)

Like Ms Foy, she signed up, hoping for a dignified funeral.

“We always say, ‘Going to the Dreamtime, rest in the Dreamtime,'” she said.

“It’s so important for us to look after your own affairs and that’s what we’ve done. We’ve gone out and got funeral insurance.”

Ms Walsh put thousands to ACBF, but when she tried to increase her level of coverage, she was knocked back on medical grounds.

She realized she’d lose all her contributions if she stopped paying, so she enlisted the help of consumer lawyers to complain to the Australian Financial Complaints Authority (AFCA).

To resolve the matter, the company put her money in a trust to be paid when she died.

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