Funeral insurance provider Aboriginal Community Benefit Fund (ACBF) has again been found to have used misleading and deceptive tactics to sell products to vulnerable Indigenous consumers who thought they were buying policies designed for their community.

The Australian Financial Complaints Authority (AFCA) has ruled similarly in previous disputes lodged against the firm, which is facing legal action from the Australian Securities and Investments Commission over the way its products are sold.

In this latest dispute ruling, the complainant joined the insurer’s Aboriginal Community Funeral Plan in February 2013 with a chosen benefit amount of $6000.

He thought the insurer was an Aboriginal organisation that “existed for the benefit of Aboriginal people,” according to the AFCA ruling.

The complainant, who currently resides in Taree, NSW, left school when he was 14 and has not been employed since 2018 due to post-traumatic stress disorder.

He says he was told by the ACBF agent that the insurer “is an Aboriginal corporation trying to take those [funeral costs] worries away from you”.

According to him, the name of the insurer and use of marketing materials with images and symbols associated with Aboriginal culture “created [the] misconception” that ACBF was an organisation linked to the community.

The complainant was also told the plan he was buying into did not require payments once he had paid up $6000 in premiums.

He was not informed that he would keep paying even after he had paid $6000.

“The term ‘plan’ has the ordinary meaning of a scheme for the regular payment of contributions,” AFCA said. “Its use to describe the ACBF business supports these meanings.

“However, the premiums were not paid savings nor was the plan an investment product. The payments were not for a purpose. The payments were directly to ACBF as a corporation. There was no fund, no trust fund and no trust.”

AFCA says the misrepresentations resulted in the complainant becoming a member of the plan at a time when he was a vulnerable person.

“The complainant was influenced by ACBF’s use of words, colours and imagery normally associated with Aboriginal and Torres Island peoples and induced by such images to rely upon what he was told by [the agent].”

AFCA ordered ACBF to refund the complainant $4185, the premiums he had paid up as at December 31 2018, the date just after he lodged the complaint through his lawyer. The plan was subsequently suspended when he missed payment of premiums at least four times.

ACBF must additionally pay an interest to the complainant, with the amount calculated based on when the refund is made.

Click here for the ruling.