“Where did that money go?” Andrew Chang, the CBC’s National News anchor, was polite. But he was persistent.

“You thought at the time that this was just the way a legitimate business operated?” he queried his subject with eye-raise-of-doubt insistence in a feature interview last week.

Then, circling back, obviously unsatisfied. “But did it, though [make sense at the time]?”

More polite. More persistent. More skeptical. “I guess I just wondered, did any of that seem fishy to you?”

The bit in his teeth now, zooming in. “Did it ever occur to you that he might be breaking the law?”

You know this story. A seemingly healthy young Nova Scotia businessman named Gerald Cotten travels to India on his honeymoon — India! On his honeymoon? — after having only recently married a woman who’d had three — count ’em, three! — last names, and after having only signed his will days before, leaving everything — of course — to her.

He supposedly dies.

He supposedly has the only key to unlock the virtual vault containing hundreds of millions of dollars belonging to more than a hundred thousand customers of his bitcoin exchange business. He takes the key to his grave.

The announcement of his death is delayed. The funeral is private. The casket is closed.

Supposedly dead.

Sounds like an exit scam.

That must mean she — Jennifer Robertson, she of the three last names, the beneficiary of the will with the $100,000 set aside for the care and feeding of their two chihuahuas — is in on it.

Gerry must now be, as more than one journalist has speculated, sitting on a beach in some exotic, extradition-free backwater, sipping a mai tai (my bet would have been Long Island iced tea) and biding his time. The plan is that once the scandal subsides, his partner in crime — did I mention those three last names, the last-minute marriage, and the last-second will? — will join him and they will live happily ever after on their ill-gotten gains.

It’s a compelling narrative, in part because it sounds like the premise for an addictive Netflix series romp. Will they get away with it?

But let me suggest another narrative, one based on having spent more than 40 hours interviewing Jennifer to help her write her memoir, Bitcoin Widow: Love, Betrayal and the Missing Millions. The book was officially launched last week. That’s how she came to be virtually sitting opposite the polite, persistent Chang and other journalists, all of them seeking The Truth.

Truth may indeed sometimes be stranger than fiction, but it can also be much more mundane.

One quick example. Conspiracy theorists have made much of the fact that the only recently married couple signed their wills just days before they left on that fateful trip to India.

But here are some other facts: Gerry and Jennifer had been living together for close to four years when they decided to make their relationship official. Happens all the time.

They’d also talked, as couples often do, about the need to make their wills but hadn’t gotten around to it, even though they’d begun to collectively accumulate valuable real estate and other assets. But then, a month before they were to leave on their honeymoon, Jennifer’s brother had a serious heart attack. That made the need for a will suddenly more urgent and real. Jennifer talked to a lawyer who came up with a draft and called to arrange a meeting so the two of them could meet with her to discuss and sign.

Jennifer told the lawyer about their planned honeymoon — the trip was supposed to last more than a month — and suggested they sign when they returned. The lawyer unsurprisingly disagreed. “You have to come in and sign this before you go to India. You’ve given me directions for your will, but you have not signed it. This is not good. You have to come in.” They came in. They signed.

Suspicious?

When my wife and I were in our early thirties, a man we knew — similar age, similar life circumstances — died unexpectedly without a will, leaving his wife to deal with the messy fallout while she also grieved her loss. We — and other couples in our circle — soon arranged for wills of our own.

It happens.

There are everyday explanations for most of the conspiracy theories about Gerry’s death in Jennifer’s memoir. As authors like to say, read the book.

But here’s my Cliff’s Notes version of the beginning of that narrative.

A young woman coming off a messy divorce swipes right on Tinder and matches with a man she comes to believe will be the love of her life. He is an entrepreneur who operates a trading business called QuadrigaCX dealing in a commodity — bitcoin — she’s never heard of. When she asks him what it is, he sends her a link to a full-page feature in The Financial Post entitled, “Brave New Digital Currency World.”

Gerry was the star of the article (actually a sponsored-content ad). “He has been focused on developing the most secure, easiest to use trading platform to simplify the buying and selling of bitcoins for a growing audience,” it said, noting that his company not only employed the “most advanced security measures in the industry,” but that it was also the “first bitcoin platform in Canada to hold a money services business licence from FINTRAC (Financial Transactions and Reports Analysis Centre).”

The Financial Post? What’s not to believe?

The business went through some ups and downs, but it grew exponentially. They became rich beyond their wildest dreams. And, yes, let’s be clear, Jennifer enjoyed every minute of the travel, the ability to buy whatever she wanted without asking the price, the opportunities it gave her to start her own business, and on and on. She says she had no reason to believe it wasn’t legitimate.

But the cash? What about the cash? What about the infamous photo with the piles of it on their kitchen counter? Wasn’t she suspicious?

There are some things you need to understand in order to understand that cash.

Bitcoin was only “invented” in 2009. It doesn’t really exist in any real bill-and-coin world of ordinary national currency.

That said, its tantalizing possibilities as a form of investment quickly attracted the interest of would-be buyers, drawn by its next-new-thing glitter and/or/especially by the fact it operated beyond regulation and oversight from the usual national governments and their finicky financial rule-makers — and, of course, tax collectors.

The traditional financial institutions like banks were wary. In fact, they’d often shut down accounts if they discovered they were linked to bitcoin. At one point, for example, CIBC froze the accounts of some of Gerry’s payment processors, tying up more than $25 million for almost a year.

Didn’t the bank’s suspicions arouse her suspicions?

Gerry’s argument — one shared among many in the bitcoin world — was that the banks were simply out-of-date and trying to protect their turf against an inevitable bitcoin future.

Until the financial world caught up with the pioneers like Gerry, cash was the way around those Neanderthal institutions.

That was the argument.

It wasn’t as if cash didn’t flow both ways — in from customers using cash to buy bitcoin at an increasing number of Bitcoin ATMs and out to customers choosing cash when they wanted to trade in their bitcoin gains for regular currency.

Every day, Gerry would fill envelopes with cash from those ATM machines and mail them to customers, which Jennifer would then drop off at the post office. No one complained when the cash arrived.

We’ll circle back to those customers.

But first this no-longer news bulletin.

It turns out that Gerry Cotton — the man Jennifer Robertson fell in love with, and that thousands of people trusted with their life savings — was a pathological liar, a scam artist of the first order. He was, it seems, very good at what he was.

According to the only definitive account of what really happened at QuadrigaCX, an after-the-scandal report by the Ontario Securities Commission, Gerry “created and traded fake assets with clients of the platform under aliases. Cotten sustained trading losses of approximately $115 million and used Quadriga clients’ assets to cover those losses [and] sustained losses of approximately $28 million trading client assets on three external trading platforms.”

A classic Ponzi scheme, with a tasty side dish of gambling.

In October 2019, after the bankruptcy trustee had revealed the extent of the fraud and the reality Gerry had mixed Quadriga’s assets with his personal accounts to fund his and Jennifer’s lifestyle, she returned to the trustee $12 million in assets she’d previously assumed were legitimately hers.

After that, Jennifer ended up living in her father’s attic, teaching English online to Chinese children in the middle of the night to make ends meet and beginning to rebuild her life. (She will graduate from Mount Saint Vincent University with her education degree later this spring.)

She has not yet disappeared to rendezvous with Gerry in that happy-ever-after, extradition-free backwater.

Gerry’s customers? While Jennifer has been an easy target for journalists and others looking for someone to blame for the scandal, few have questioned the culpability of the investors who chose to put their money in QuadrigaCX.

Without attempting to minimize the financial losses they suffered, it is worth pointing out that they — perhaps more than Jennifer —  understood the risks they were taking. Bitcoin was new, it was volatile, it was unregulated, which was, in truth, one of its attractions for many of those same customers.

All of that made it ripe for fraud Gerry Cotton perpetrated.

When they realized they’d been duped, more than a few of those same investors took their anger out on Jennifer. She was stalked, she was subject to vile online death threats, and, eventually, she was driven to attempt suicide.

And yet no one asks them what the hell they were thinking, trusting this scam artist with their life savings?

Back to Andrew Chang. Chang had the chance to put exactly that question — politely if persistently, of course — to one of those investors he interviewed as part of his feature with Jennifer Robertson.

Michael Perklin “met Cotton at a cryptocurrency meet-up,” Chang reported. They became “fast friends,” and Perklin not only invested several thousands of dollars of his own money in Quadriga, but he also convinced friends and family to do the same. They ended up losing “well into the seven-figures,” he told Chang.

“More than a million dollars?” Chang marvelled.

“Yes.”

And that was that. No follow up, no did-any-of-it-seem fishy, no did-it-ever-occur-to-you-that-he-might-be-breaking-the-law questions.

Later in the interview, when Perklin was asked whether he thinks Gerry might still be alive — the continuing favourite conspiracy theory — he responds with what seems to be befuddlement: “Everything I knew about Gerry seems to have been a lie.”

Gerry Cotton, it’s clear, was a very good liar.

So, why is Jennifer Robertson the only one to blame for believing him?


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Stephen Kimber

Stephen Kimber is an award-winning writer, editor, broadcaster, and educator. A journalist for more than 50 years whose work has appeared in most Canadian newspapers and magazines, he is the author of...

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  1. Basically Stephen Kimber is saying that Jennifer R. was a legit Mafia wife (“Jennifer enjoyed every minute of the travel, the ability to buy whatever she wanted _without asking the price_, the opportunities it gave her to start her own business, and on and on”), and also that the “investors” (wrong word, they were not investing _in_ QuadrigaCX) were not asking too many questions.

    QuadrigaCX was a legitimate _exchange_, where you could buy/sell Bitcoin. There is nothing illegal or questionable about that. You could also leave your money and your bitcoins in the exchange, in effect treating it like a bank: that was the problem. As the bitcoiners say, “not your keys, not your bitcoin”. That was a huge mistake many people made. There is actually the same issue when you leave your money in a fiat bank—that’s why there’s deposit insurance (up to a limited amount).

    If you remember the Bernie Madoff ponzi scheme, nobody said a word as long as they were making “too good to be true” wads of money (I’m sure the Spidey senses were tingling, but hey, we’re making money, let’s ignore that), but as soon as the scheme collapsed they started complaining that Madoff had ripped them off. But this ponzi scheme was about the greedy ones _investing_ in Madoff’s _fund_, and watching it grow unlike any other fund on Wall Street.

    I don’t think the comparison with Quadriga customers is valid: Quadriga customers were using it as an exchange, and not as a fund to invest in (the potential to realize gains was thru Bitcoin value appreciating (just like housing value appreciating), not through Quadriga CX itself). Using Quadriga as an exchange is not the same as investing in a fund that at its core was a criminal and illegal enterprise. Shame on Mr Kimber for blaming the victims of this fraud!

  2. In answer to the question posed by the headline, there are so many people to blame for the Quadriga disaster that it’s hard to know where to start, although a good place might be media outlets like the Financial Post for – among other things – accepting “sponsored content” (aka ads) knowing it legitimizes the contents. But while we’re on the subject of journalistic ethics, I’m disappointed the Examiner would allow use of this space for what amounts to an apologetic by someone with skin in the game. Stephen Kimber is correct in pointing out the sexism implicit in the fury being heaped on Robertson, but let’s not forget she invited more scrutiny by publishing a book and doing interviews to promote sales. If other people involved in Quadriga do the same I hope they’ll get tough questions as well. (Also would love to see some investigation into the financial regulators asleep at the wheel!)

    No, the Examiner didn’t accept money for posting this story and yes, Mr. Kimber’s involvement is disclosed in the sub-header, but what I want to know is, would the Examiner have published a commentary critical of journalists asking tough questions if it wasn’t related to a book written by one of your own? And If this story is important enough to publish, why not get someone else to write it?

    Berta Gaulke

    1. A point of clarification. I was hired to help Jennifer write her book on a contract. I was paid out of Jennifer’s publisher’s advance. My “skin in the game,” as Berta puts it, is over. Whether the book succeeds or fails, whether it’s turned into a movie or a series, won’t change my benefit from it.

      My commentary — and that’s what I’m paid to do at the Examiner — is simply based on the fact I spent many hours interviewing her and came to my own views of her honesty.

      I have no quibble with journalists posing tough questions. I don’t think those were them. In the book, for example, Jennifer responds to many of the conspiracy theories about her role in what happened.

      A tough question would have been: “You say this in the book about that. But what about this, and this and this?” Specifics. Based on counter research. Tough. To which an interviewee needs a specific answer…

      A shocked and appalled, ‘How could you not know?’ no matter how many times you repeat it in how many different words, is not a tough question.

      1. I would just add that while QuadrigaCX may have been considered “a legitimate exchange,” was it regulated? Wouldn’t a regulated company akin to a bank have to show some percentage of cash on hand to cover accounts? Wouldn’t it be insured?

        I haven’t followed this, so might be wrong, but I’m guessing that given the people who put their money into it got nothing at all, it wasn’t regulated or insured, which is par for the course with all things Crypto, no?

      2. Clarification noted, but for the record, I never said the skin was financial.

        I guess this is why you’re a professional journalist and I’m not. Because I naively think that when someone described as your “soul mate” engages in criminal activity from which you benefit and in which you at least indirectly participate (Robertson didn’t just “drop off” envelopes of cash at the post office, she had two related businesses – Robertson Consulting Nova, which processed money for Quadriga, and Robertson Nova, which invested the ill-gotten gains in real estate) and you publish a book claiming you didn’t know, the question “How could you not know?” seems pretty relevant and a shocked and appalled “I trusted him” no matter how many times you repeat it in how many different words, is not a good answer.

  3. I believe her because there is no reason, or evidence, to not believe her.
    We, aged over 65, signed our wills on the day we flew to Britain in 2019. I don’t know everything about my wife and she doesn’t know everything about me. Until 2 weeks ago I did not know the identity of the father of my father. My very strong suspicion, based on 2 very brief incidents, each of a few seconds, and a name, turned out to be the truth.

  4. Many investors are quite happy to look the other way and ignore questionable business practices, as long as the money is coming in. This applies whether the company is a cryptocurrency start-up or a long-established multi-national corporation. And losses are always someone else’s fault.