The Australian Securities and Investments Commission (ASIC) today announced that former Courtenay House director Tony Iervasi pleaded guilty to five criminal charges. The fraud case dealt with the operation of a foreign exchange Ponzi scheme when Iervasi was director of Courtenay House Pty Ltd (in liquidation) and Courtenay House Capital Trading Group Pty Ltd (in liquidation).
Iervasi faces up to 10 years imprisonment and a $810,000 fine.
The official announcement detailed that fraudulent scheme which took place between 13 December 2010 and 21 April 2017, raised $180 million from 585 investors.
According to ASIC, the Courtney House companies convinced investors that their funds would be traded in Forex and Futures markets, however, only 3% of those funds were actually traded. Instead, the amounts paid to investors on monthly basis, came from the deposits of new investors.
The Australian regulator stated:
In addition to offering purported ‘standard’ investment products, Mr Iervasi ran several ‘investment specials’ to encourage trading. In December 2016, Mr Iervasi invited clients to invest in a ‘US Election Special Trade’ which was to take place between 1 January 2017 and 1 February 2017 to coincide with the Inauguration of President Trump, as a way to invest in what Mr Iervasi claimed was ‘fast-money markets’.
Iervasi pleaded guilty to four counts of engaging in dishonest conduct and one charge of carrying on an unlicensed financial services business as the Courtenay House companies did not hold an Australian Financial Services (AFS) license.
