Thow claims 'another story' in downfall
Former investment adviser in court to answer questions about income


Andrew A. Duffy

Tuesday, October 30, 2007

SEATTLE -- Ian Thow contends there is yet another story to be told surrounding his downfall.

The former high-flying Berkshire investment adviser, who fled Canada in the summer of 2005 for Seattle amid allegations he defrauded former clients of more than $32 million, maintains there is more to the story than meets the eye.

Thow looked fit, tanned and comfortable as he walked into court with open-collar blue shirt and tweed blazer slung over his shoulder. He claims to have lost about 25 pounds in the last year and appeared upbeat and jovial as he has on previous court visits, making a point of warmly greeting the media and others.

"What is there to say? The whole story will eventually come out," Thow told the Victoria Times Colonist on Monday during a brief conversation at the federal courthouse in Seattle.

Thow was in court to answer questions from Michael Cheevers, the trustee handling his Canadian bankruptcy. Cheevers, who had been trying for more than a year to get Thow to answer questions about his sources of income, places of residence and where he was working, finally got his chance to get some answers.

The examination is part of Cheevers' search for what may be left of the millions Thow's former clients believe he stole from them.

A Seattle court had already ruled Thow had to answer a series of written questions from Cheevers, but until Monday his only answer was to invoke his Fifth Amendment right under the U.S. Bill of Rights, which means he refused to testify under oath on the ground the answers given could be used as evidence to convict him of a criminal offence.

Despite requests, the media were not permitted to witness the examination.

The Times Colonist has made application to the court to receive a transcript of the proceedings, although the court was not expected to make them available as the meetings were continuing through the day.

Legal counsel for both Cheevers and Thow argued to have the proceedings closed in order to maintain the integrity of the examination, ensure the process was efficient and to protect Thow's personal banking information.

However, Thow did talk briefly with the Times Colonist before his counsel ushered him into the examination room. He took great pains to ensure the conversation was not being recorded by patting the upper body of the reporter.

As he had done on previous occasions when the topic of possible criminal charges came up, Thow suggested there was still another shoe to drop, though he would not elaborate on exactly what that meant.

When he was told provincial Crown counsel had been handed the RCMP Integrated Market Enforcement Team's file on him and were doing a charge assessment that could result in criminal charges, Thow joked and made light of possible extradition to Canada, pointing out the Canadian dollar is now at least worth more.

He was also asked why he didn't bother to show up at the B.C. Securities Commission's hearing into his conduct.

"That was a kangaroo court," he said. "I didn't have a chance to defend myself."

But when it was pointed out he had every opportunity to appear and answer the allegations, he said he wasn't able to cross the border because there was a civil warrant out for his arrest. That civil warrant was issued on behalf of the trustee who claimed Thow breached the Bankruptcy Act by removing assets from his home.

Thow also said it wasn't worth spending an estimated $100,000 in legal fees to have a lawyer represent him at the BCSC hearings when the maximum fine the BCSC can levy is $250,000.

The BCSC called Thow's action one of the most callous and audacious frauds in B.C. history, ruling Thow perpetrated a multimillion-dollar fraud when he took money his clients gave him to invest and instead spent it on a luxurious lifestyle.

The BCSC is expected to hand down its sanctions in November, and on top of the $250,000 fine are expected to ban Thow for life from trading securities in B.C.

Thow appeared in court Monday flanked by both his bankruptcy counsel, Larry Feinstein, and criminal attorney, Jessica Riley, of the law offices of John Henry Browne. Riley is expected to represent Thow if criminal charges and extradition procedures are started.

A spokesman for the Crown said the file is massive and will take some time before charges are prepared.

None of Thow's victims made the trip to Seattle for the court appearance. When contacted, some said they weren't going to risk travelling with a chance Thow wouldn't turn up.

When told of Thow's comments regarding another story yet to be told, Brad Goodwin, whose family was allegedly taken for $1.4 million, couldn't help but laugh. "Oh, I can't wait to hear that one," said Goodwin. "I mean there's only a forensic accountant who has traced the money down [to Thow spending it], and there's now this other part of this story?"

aduffy@tc.canwest.com

see: 

Ian Thow takes flight