The provincial securities regulator is being tight-lipped about the case of a missing Montreal businessman who is believed to owe investors as much as $50 million.
The Nova Scotia Securities Commission would not say Tuesday whether it has received complaints from any Nova Scotia residents who had invested money with Earl Jones, a Montreal financial planner.
One Halifax resident spoke with CBC Radio earlier this week about money he fears he has lost investing with Mr. Jones.
“At this stage, it is difficult to say anything,” said Scott Peacock, the deputy director of compliance and enforcement at the Nova Scotia Securities Commission.
“I can’t comment on an active investigation.”
However, Sylvain Theberge, a spokesman with the Quebec securities regulator, Autorite des marches financiers, said that organization has been receiving calls from consumers “from coast to coast” about the Jones case.
The Quebec regulator is exchanging information with securities commissions in other provinces, as well as the United States regulator, he said.
“Most of the investors were from the west island (of Montreal),” Mr. Theberge said Wednesday.
Mr. Jones, who ran Earl Jones Consultant and Administration Corp., was not registered to trade in securities.
“It is true,” Mr. Theberge said. “This guy was not registered and he was doing business for a long time, until the moment something went wrong.”
After Autorite des marches financiers started receiving investor complaints last Wednesday, it froze Mr. Jones’s accounts, which were all empty, except for a few hundred dollars, Mr. Theberge said. “If you do business with (an unregistered) company or individual, it is like you are giving your money to anybody at the corner of the street.”
While Montreal and Quebec police forces are investigating the case, Mr. Jones’s whereabouts remain unknown.
He has not been charged with any crime, and the allegations against him are unproven. A number of his investors packed a Montreal hotel conference room Sunday to exchange information. A group of investors have since started a Facebook site and a website called swindledbyearljones.com.
Mr. Peacock said consumers should always check to see if the investment adviser or dealer they choose is registered.
“Registration is one of the cornerstones of market regulation and investor protection.”
Registration puts a dealer or salesperson person under the supervision of 13 provincial and territorial securities regulators, as well as self-regulatory organizations, such as the Mutual Fund Dealers Association of Canada and the Investment Industry Regulatory Organization of Canada, he said.
Individuals or dealers must meet certain criteria and pass a background check in order to be registered.
“The more sophisticated the security instrument, the more training and experience is demanded before a person is licensed to sell that type of a product,” Mr. Peacock said.
“Registered individuals with registered dealers contribute to a fund for compensation for investors who are the subject of malfeasance. “When you are dealing with somebody who is totally unregistered, you don’t have the benefits of those protections.”
There is little recourse for investors because Mr. Jones was not registered, Mr. Theberge said.