Earl Jones's company declared bankrupt

The company of Montreal investment adviser Earl Jones has been declared bankrupt by a Quebec court, clearing the way for a trustee to see how much money is left.

More than 70 former clients of the company known as Earl Jones Consulting gathered outside the Quebec Superior Court in Montreal to await the ruling, made Wednesday morning.

Jones, who ran the company based in the suburb of Pointe Claire, is out on bail after being charged with four counts each of fraud and theft.

Quebec's securities regulator alleges Jones swindled at least 50 investors out of at least $30 million in a possible Ponzi scheme.

Jones did not attend the bankruptcy hearing, but Neil Stein, who represents some of the company's former clients, did.

"[The ruling] gives us the availability to act under the bankruptcy act," Stein said. "Under the bankruptcy act there are conditions which enable thorough examinations under oath and enable a review of transactions."

Stein said Jones's alleged victims should be hopeful.

He said this is not his first bankruptcy case, and he thinks money will be recovered.

One of Jones's alleged victims, Mary Sue Gibson, appeared at the hearing and testified her family has lost $1 million.

Creditors will likely meet in mid-August when the value of any assets could be divulged.

Jones, 67, turned himself in to provincial police Monday to face charges of fraud and theft after disappearing for about three weeks. He was arrested at his lawyer's Montreal office.

The allegations against Jones have not been proven in court.