Unravelling of dead financier's affairs reveals house of cards

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For years, Robert Mander's clients thought he was an investment guru in Oakville, Ont., who catered to artists, businessmen and dentists.

They trusted him with more than $40-million and were impressed by his exclusive art gallery, his 2010 Jaguar and $440,000 jewellery collection that included 12 expensive watches and three Fabergé eggs.

But when Mr. Mander couldn't come up with more than $2-million in interest payments and fended off queries with claims of heart attacks and tales of mysterious dealings in New York, a group of investors headed to court.

By the time they got an Ontario judge to put Mr. Mander's companies into receivership on March 17, Hamilton police had found Mr. Mander dead at his house in Flamborough, outside Hamilton. Investors were left stunned and confused about what had happened to all their money. "I'm just waiting to get the story like everybody else," said Steven Volpe, an artist in Orangeville, Ont., who invested with Mr. Mander.

On Monday, the receiver, RSM Richter Inc., filed a report in court that offered new details about Mr. Mander's background, but little hope for investors.

According to the report, Mr. Mander was far from an investment superstar. He'd been a life insurance salesman who tried his hand at investing in 2003 with disastrous results.

He formed an investment business with a former insurance colleague, Tasha Fluke, but they soon had a falling out. Ms. Fluke sued Mr. Mander in 2007, alleging he'd bilked her and her family out of $2-million by claiming to be a master options trader who could generate returns of up to 100 per cent. He denied the allegations and alleged Ms. Fluke had taken some of the money and then had her brother threaten him.

While that feud played out in court, the report alleged, Mr. Mander formed another business and brought in new investors, promising them annual returns of up to 25 per cent. One investor, dentist Davide Amato, attracted dozens of clients who chipped in $18-million. Mr. Mander provided sketchy details, and little documentation, about what he did with the money, the report alleged.

When some investors began asking for payments last fall, the report alleged, Mr. Mander took desperate measures. First he concocted a story about a $40-million building in New York that he had acquired through an inheritance from his father. His father's friend, "Arthur," was selling the building, which would cover all the investor's debts. But the receiver discovered that Mr. Mander's father had little money and was living on a pension at the time of his death. "Arthur" was an electrician living in California.

Mr. Mander didn't stop there. The report alleged he burned a stack of documents and tried to sell assets, including two properties and the Fabergé eggs. Mr. Mander also claimed heart problems, other court filings allege, but mixed up the dates of a heart attack.

At the time of his death, the receiver's report said, Mr. Mander was in financial trouble. He had less than $30,000 in the bank and close to $150,000 on two MasterCards and a line of credit. He was on the hook for $8,000 a month in support payments to the mother of his son, and his art gallery in Oakville was losing money.

It's not clear how much the receiver will be able to recover for investors. Mr. Mander owned six properties, including a house worth more than $3-million. But many have mortgages and Mr. Mander pledged some to investors to cover debts. Investors will be back in court tomorrow hoping for more answers.

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