After all the news during the past few months about Bernie Madoff’s Ponzi scheme down in the US, it looks like we have our own here in Canada. Earl Jones is a financial adviser who has suddenly disappeared with $30-$50 million of his client’s money.
Authorities have frozen the accounts of both Earl Jones and his company, Earl Jones Consultant and Administration Corp. The next step they will take is to force the corporation into bankruptcy, allowing the remaining money to be distributed back to the investors.
These investors were unlikely to expect this to happen, some have invested with Earl Jones for 30 years. However, it does provide a reminder that you should have a basic understanding of what your financial adviser is investing in and what is providing the return on your investment. If you require financial advice, you would more likely be isolated from these schemes by hiring a fee-only financial planner. Another option would be to invest on your own using simple index funds.
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Tom Drake is the owner and head writer of Canadian Finance Blog.
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[...] what happened to their money. Two high profile investment frauds in Canada had been orchestrated by Earl Jones and recently Gary [...]
This environment can lead to decreased vigilance on the part of investors and regulators alike, allowing such larcenous activity to grow. -Julia Timonina