Greg Martel, the Victoria, B.C. mortgage broker behind a Ponzi scheme that brought in more than $300 million from investors, has been arrested in the country of Georgia. Martel has not been criminally charged, but he is the subject of a Canadian arrest warrant and a U.S. detention order connected to receivership and bankruptcy proceedings.

Greg Martel, the Victoria, B.C. mortgage broker behind a massive investor fraud scheme, has been arrested in the South Caucasus nation of Georgia.

CBC News reported that Martel’s arrest has been confirmed, although the date and specific circumstances of the arrest are not yet known.

Martel operated Shop Your Own Mortgage, a company that collapsed into receivership in 2023. The business was later found to have been used as part of a Ponzi scheme that brought in more than $300 million from approximately 1,700 investors.

The scheme involved selling investments in fabricated real estate bridge loans. Investors were promised unusually high returns, in some cases reportedly as high as 100 per cent on an annualized basis.

As with other Ponzi schemes, early investors were paid using money received from later investors. The scheme began to show signs of collapse in late 2022, when some investors stopped receiving expected payouts. By spring 2023, the company had collapsed and lawsuits against Martel began to mount.

PricewaterhouseCoopers, the trustee overseeing Martel’s receivership and bankruptcy, has estimated that the scheme brought in approximately $301 million from investors and paid out about $210 million. Investigators have said the remaining $91 million was lost through options trading, other failing business ventures, and spending connected to Martel’s lifestyle.

Martel disappeared after his company was forced into receivership. Investigators later tracked him to Thailand and Dubai before his arrest in Georgia.

Global Affairs Canada said it was aware of the arrest of a Canadian citizen in Georgia and that consular officials were providing assistance and communicating with local authorities. The department did not release additional details, citing privacy considerations.

Although Martel is widely associated with the collapse of the Ponzi scheme, he has not been criminally charged. He was found in civil contempt of court for failing to co-operate with receivership proceedings, and a warrant was issued for his arrest in Canada. He is also subject to a detention order in the United States.

The case raises complex cross-border enforcement issues. Canada does not have a formal bilateral extradition treaty with Georgia, but both countries are signatories to international treaties that can allow extradition in certain circumstances.

For investors, Martel’s arrest is a significant development in a case that has involved years of litigation, asset tracing, and uncertainty over whether meaningful recovery will be possible.

The case also illustrates the difficulty of recovering funds after a Ponzi scheme collapses, particularly where money has moved through multiple jurisdictions and has allegedly been diverted into trading losses, business ventures, and personal spending.

Martel’s arrest does not itself resolve the outstanding investor losses, nor does it mean criminal charges have been laid. However, it may assist court-appointed officials and authorities seeking answers about the missing funds and the operation of the scheme.

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Originally published on Canadian Fraud News.