Angry fraud victims to confront bank

As part of a $40-million class-action lawsuit against Royal, the senior citizens claim the bank knew about irregularities involving the Jones account, opened in 1981, but was “willfully blind.”… It has now been 18 months since Jones’s Ponzi scheme collapsed. Three of his elderly victims have died in the interim, which is helping to spur the remaining clients.

The Toronto Star
December 11, 2010

Angry fraud victims to confront bank
Seniors cheated out of life savings by fraudster will march outside RBC headquarters
Kenneth Kidd

Earl_Jones_Royal_Bank.jpeg

On July 27, 2009, financial adviser Earl Jones, right, escorted by police and accompanied by his lawyer Jeffrey Boro, left, leaves an office tower in Montreal. Graham Hughes/THE CANADIAN PRESS

Dozens of senior citizens, all fraud victims of money manager Earl Jones, will rally Tuesday at the head office of the Royal Bank of Canada, angry at what they see as the bank’s role in the loss of their life’s savings.

“There’s a lot of frustration,” says Joey Davis, whose 80-year-old mother, Margaret Davis, lost about $200,000. “Some people have had to sell their homes just to survive.”

About 50 seniors are coming from Montreal on a chartered bus, to be joined by a dozen or so victims from the Toronto area. They hope to present Royal executives with a hardcover book outlining their hardship in the aftermath of one of the country’s biggest Ponzi schemes.

Entitled “Earl Jones and The Royal Bank of Canada,” the tome contains about 60 letters addressed to Royal CEO Gord Nixon and nearly as many photographs depicting Jones and those he defrauded. The cover has a picture of Jones surrendering to police and the subtitle: “The truth behind the so-called ‘in trust’ accounts.”

That’s a reference to the personal chequing account at a Royal branch in Beaconsfield, Que., that Jones used to comingle his clients’ money. Jones falsely claimed it was a trust account and used it instead to pay for everything from Montreal Canadiens seasons tickets to membership in a club in Boca Raton, Fla.

As part of a $40-million class-action lawsuit against Royal, the senior citizens claim the bank knew about irregularities involving the Jones account, opened in 1981, but was “willfully blind.”

Jones pleaded guilty to two charges related to defrauding 158 clients. He was sentenced in February to 11 years in prison but is eligible for parole after 22 months.

His clients were typically older women in Montreal and Ottawa, often widows, many of whom are now struggling financially as a result of their dealings with Jones. “He had total access to their funds and complete trust,” says Davis.

Jones used Royal Bank letterhead and logos to add legitimacy to his scheme, and the bank argues it was equally a victim.

“We were deceived by Earl Jones just as his clients were,” says bank spokesperson Gillian McArdle. “Until 2009, there was nothing to signify Earl Jones was anything other than the successful and legitimate businessman he claimed to be.”

The bank, Canada’s largest, has yet to file a formal statement of defence, and none of the claims against it has been proven in court. A trial is scheduled for autumn of 2011.

Those travelling to Toronto by bus “want to show the bank they’re not just a number on a spreadsheet,” says Kevin Curran, who with Davis is helping to organize the trip. Curran’s mother, Karlene Kennedy, lost about $400,000.

The seniors plan to rally in front of the Royal’s head office, and hope a delegation will be allowed inside to present their book to bank executives.

The bank, however, has no plans to allow such a meeting. “Any communication between the two groups is being handled by each group’s respective legal counsel,” says McArdle.

Weather permitting, however, the seniors still plan on making the voyage.

“We’re really responding to a group of senior citizens who want to have their voices heard,” says Davis.

It has now been 18 months since Jones’s Ponzi scheme collapsed. Three of his elderly victims have died in the interim, which is helping to spur the remaining clients.

“Time is very precious to them,” said Davis. “They want to see things happen.”

http://www.thestar.com/news/article/905444--earl-jones-victims-prepare-to-rally-at-royal-bank-hq


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