The Canadian Press
Disgraced financial advisor Earl Jones choked back tears as he quietly pleaded guilty to orchestrating a massive Ponzi scheme, completing the fall from grace of a once-revered figure in his community.
Jones pleaded guilty Friday to two fraud charges after having duped 158 investors of about $50 million. He swindled many seniors out of their entire life savings.
Until recently, he owned homes in luxury locales and was a pillar of his community. Following his arrest, he lived in a rooming house and will now be calling a prison cell home while his own family shuns him.
In exchange for the pair of surprise guilty pleas, the Crown withdrew eight initial charges of fraud and theft laid against Jones last summer.
Both Crown prosecutor Pierre Levesque and Jones’ lawyer, Jeffrey Boro, suggested a prison term of 11 years when he is sentenced Feb. 15.
Jones, dressed in jeans and a blue sweater, spoke in a soft voice before a packed courtroom. He didn’t address the court at all, other than to mumble “sorry” in a choked voice before he was taken into custody.
His own lawyer acknowledged that it was too late for an apology.
“Sorry doesn’t cut it and Mr. Jones knows that,” Boro told Quebec court Judge Helene Morin.
None of Jones’ relatives were present Friday. His wife has filed for divorce, and his relatives no longer speak to him.
Jones had swindled members of his family — including his own brother.
He ran a pyramid scheme in which many of his former clients, mainly elderly pensioners, lost all their savings.
Levesque told the court that police and the trustee spent months going over the books and were able to agree on a conservative estimate of about $50 million taken between 1982 and 2009.
It’s unclear exactly how many people were impacted.
“There could be more than one person in an account; for instance if Mr. Jones was handling an estate, there could have been three, four or five people,” Levesque said.
Levesque indicated the amount defrauded might have been higher, but both sides agreed on a number compiled by the bankruptcy trustee and the provincial police detectives.
“The $50 million we’re talking about only covers amounts that were verified with the proper documentation,” Levesque said.
“We’re being very conservative and decided to go by this figure.”
The investigation revealed that Jones spent $13.8 million of that money between 1987 and 2009 on himself and his family.
Levesque said the investigation showed that Jones only used one bank account for all transactions — business and personal — and the banks he worked with didn’t appear to scrutinize the irregular practice.
Boro explained that Jones had started his business with the best of intentions, but that a downturn in the economy forced him to start using money given to him in trust.
“He started to take some money in the hope he would be able to put it back,” Boro said.
Jones co-operated fully with investigators and made no attempt to hide his crimes.
“Because Mr. Jones did nothing to cover up his crime, it would have been impossible for me to win this case in a significant way,” Boro told reporters outside the courtroom.
But the Crown made it plain that the self-described financial planner never invested a dime.
Jones had his lawyer read a statement in court saying how sorry he was.
“There are no words I know that can truly express to each of you how sorry I am, and always will be, for the hardship and pain I caused you,” said Boro, reading from Jones’ statement.
“I have ruined your lives as well as the lives of my family and myself, and will forever live with this terrible tragedy.”
His wife Maxine, who has claimed she had no prior knowledge of his alleged financial misdeeds, has filed for divorce.
Both Jones and his financial-services company have been declared bankrupt.
Jones, who has reportedly been living off his modest government pension since his arrest, had remained largely invisible since his initial court appearance and was staying in a rooming house.
It was a far cry from his once-lavish lifestyle. He owned a picturesque waterfront condo, a ski-resort home in Mont Tremblant, and a tropical getaway in Boca Raton, Fl.
Some of Jones’ former clients, as well as their relatives, were in court Friday.
“I accept the sentence,” said Joey Davis, the son of one of Jones’ victims.
@page_break@“But the crimes of Earl Jones were perpetrated over 27 years so this has a very severe impact not only on us as the victims, but on society as well.”
Victims say they may pursue the banks in court.
“This Ponzi scheme could not have happened without the implicit functioning of the banks,” Davis said.
The Canadian Press