Former Courtenay House director Tony Iervasi has been sentenced to 11 years imprisonment for criminal charges relating to the operation of the firm’s Ponzi scheme.
According to an update from ASIC, Iervasi was convicted in the New South Wales Supreme Court and the sentence includes a non-parole period of seven years.
The sentence included a significant discount considering Iervasi’s guilty plea and other factors.
In sentencing Iervasi, Justice Sweeney took into account the total period of offending “of about six and a half years”, the nature and circumstances of the offending which included sustained deceit, the large number of victims, the total amount of money they deposited, the total net loss to victims of $54 million, and the total amount of dishonestly obtained funds used for the offender’s benefit which was around $12 million.
Iervasi pleaded guilty to four offences of engaging in dishonest conduct in relation to a financial product or financial service contrary between 13 December 2010 and 21 April 2017, when he was the sole director and shareholder of Courtenay House, which raised around $180 million from around 585 investors.
He also pleaded guilty to an offence of carrying on an unlicensed financial services business.
The Courtenay House companies, based out of Bondi Junction in NSW, represented to investors that their funds would be traded in forex and futures markets when only around three per cent on moneys deposited was actually traded.
Instead, monthly amounts paid to investors were derived from capital deposited by new investors. This has been referred to, and admitted by Iervasi, as a ponzi scheme.
The matter was prosecuted by the Office of the Director of Public Prosecutions (Cth) after an investigation and referral by ASIC.
The Courtenay House companies appointed liquidators on 16 May 2017. The liquidators of Courtenay House Capital Trading have distributed dividends of 28 cents in the dollar and the liquidation process is ongoing.
Another director, David Sipina, pleaded guilty to two criminal charges relating to his role at the Courtenay House group of companies in March, earlier this year.