Dr. Arthur Porter and his wife, Pamela, were taken into custody by local authorities after they arrived in the Central American country.
Quebec police announced months ago that they wanted to charge him in connection with the province's ongoing corruption scandals. Porter, however, has been quoted in media reports as saying he did nothing wrong.
He faces charges of fraud, conspiracy to commit fraud, fraud against the government, breach of trust, money-laundering, and accepting bribes. His wife, whose arrest warrant had not been public, faces charges of money-laundering and conspiracy.
A spokeswoman for Quebec's anti-corruption police unit said Tuesday that the Porters may oppose their extradition to Canada, where they would face multiple criminal charges, including fraud.
"The process of extradition is going on," Anne-Frederick Laurence said of the Porters, who are detained in a Panama City jail.
Porter, who received prestigious appointments from different levels of government in Canada, was the subject of an international arrest warrant on Interpol.
The couple arrived in the country Sunday from Nassau, Bahamas, Panama's national police service said Tuesday in a statement. They were supposed to spend a day in the country before flying to the Caribbean nation of Trinidad and Tobago.
Officers arrested Pamela Porter at 11:40 p.m. Sunday, shortly after her arrival at Panama City's Tocumen International Airport.
After a delay, Arthur Porter was taken into custody at a hotel Monday at 2:30 p.m. Montreal La Presse newspaper reported that he had initially talked his way out of being detained by flashing a diplomatic passport from his native Sierra Leone.
Panamanian police said the couple is being detained until their "prompt extradition" to Canada.
Quebec authorities, however, couldn't say how quickly the Porters would be returned to Canada to face justice.
"We don't know how long it can take, but he can oppose it and he has 15 days to (do so)," Laurence said.
"So, it's a legal process now."
The Sierra Leone-born physician is one of several people facing charges stemming from the construction of the $1.3-billion McGill University Health Centre in Montreal — one of Canada's biggest infrastructure projects.
The others are: former SNC Lavalin senior executives Pierre Duhaime and Riadh Ben Aissa, Yanai Elbaz and Jeremy Morris, the administrator of a Bahamas-based investment company.
Porter's arrest has set off a political ripple effect in two capitals.
In Quebec City, opponents of Liberal Leader Philippe Couillard questioned his former business ties to Porter. And, in Ottawa, Prime Minister Stephen Harper's opponents questioned his judgment — given all the recent scandals swirling around people he appointed.
Liberal leader Justin Trudeau listed other controversial Harper appointees, including senators Mike Duffy, Pamela Wallin, Patrick Brazeau, as well as his former aide Bruce Carson and ex-chief of staff Nigel Wright.
"We see that this prime minister doesn't have a gift for making good choices when he makes partisan nominations in areas where we shouldn't have partisans," Trudeau told reporters after question period.
Public Safety Minister Vic Toews, meanwhile, applauded Porter's arrest.
"While I can't comment on a specific case, I can say that anyone involved in corruption must face the full force of the law," Toews said.
"Arthur Porter resigned nearly two years ago; these allegations have no connection to his role with the federal government."
In 2008, Porter became head of the Security Intelligence Review Committee, which monitors the work of CSIS. That appointment came two years after he was named to the watchdog by the Harper government.
Porter abruptly resigned from his federal post in November 2011, ultimately quitting his hospital role as well and leaving the country.
Porter has been working as the managing director of a private cancer treatment centre in the Bahamas, where he now resides. He told media a few months ago that he had late, stage-four cancer and was too ill to travel to Canada.
Porter looked frail in images that appeared with news reports in recent months.
But a video clip of Porter's arrest, released by media Tuesday, appeared to show a healthier-looking man. The handcuffed doctor was shown walking through a parking lot, flanked by police officers.
Another clip showed a cuffed Pamela Porter also being escorted by police.
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