If you're wondering why Earl Jones has not yet been found - and quizzed - Alan Mak thinks he may have the answer.
Such investigations often lag for two reasons, said the forensic accountant at Rosen & Associates in Toronto: because white-collar crime is not perceived as being as serious a crime in Canada as it is in the U.S., and because various police forces are loath to step on each other.
Photograph by: MARIE-FRANCE COALLIER, THE GAZETTE, The Gazette
But the fact that the Sûreté du Québec has taken over the investigation into a presumed fraud of $50 million or more by the West Island financial adviser might speed things up a bit, Mak said.
The first step - to find Jones - isn't as simple as it sounds, he said. Municipal and provincial police don't normally have access to airline or hotel records abroad. And the RCMP or the Canadian Security Intelligence Service usually cannot be asked to find someone unless a formal investigation is opened.
Police forces are almost always more interested in putting white-collar criminals in jail than in recovering the money, Mak said. "That's why I tell my clients to file civil suits" in fraud cases, he said. Investors might be furious at the swindler and passionately want to see him or her behind bars, but they are more interested in recouping at least some of their losses.
"And it must be said that in Canada, white-collar crime is simply not a priority."
He added that the big frauds - Enron and the Madoff case, notably - get reported ad nauseam in the media. But the recent proliferation of smaller Ponzi schemes is not written about, Mak said. "We're seeing a lot more of them these days, particularly in the (Toronto) Chinese community."
Mak also wondered precisely when police got the first reports from investors who suspected something was wrong.
"The (Jones case) broke on Thursday last week, but typically, police start getting calls much earlier. In fact, that's how the media often get wind of them. Unfortunately, it's my experience that they don't make a great effort right away."
But even if it did not happen like that in this case, "police couldn't care less about the money. They want the guy in jail, and leave the company to deal with the fraud."
Only after a formal investigation is launched can police seize and freeze any assets or records. Only then does the hard part begin.
"After that," Mak said, "it's just one massive chase following the paper trail."
If there has indeed been a fraud, it can get fiendishly complicated. "There might be accounts in the wife's name, the girlfriend's name or the kids' names. Or different companies formed where you can move money in and out.
"It's a huge labour-intensive exercise just to follow the cash. But the basic principle is that you want to reconstruct the ins and outs. You want to try and compare the distribution to investors with the investment contributions from those same investors.
"But it's hugely difficult and convoluted," Mak said. "It's never straight in and straight out. There are different companies and different accounts."
Police forces have their own white-collar crime experts, but also typically call in outside help like Rosen to assist in particularly complex cases.
And people may joke about Swiss or Cayman Islands bank accounts, Mak said. "But that might well be the case. It has often been."
fshalom@thegazette.canwest.com