John Darwin, a former teacher and prison officer, was declared dead in 2003, a year after his canoe was found wrecked on a beach in the north of England.
However, the 57-year-old walked into a London police station at the weekend, claiming that he was unable to remember where he had been, and telling police: "I think I may be a missing person."
His wife Anne, 55, who received a life insurance payout for her husband's 'death,' moved to Panama almost two months ago.
A few days after John Darwin announced his return, the Daily Mirror newspaper uncovered a photograph of him and his wife in Panama - taken in July 2006.
Police subsequently detained Darwin, and he appeared in court on Friday morning, where police were given permission to keep him in custody for a further 36 hours.
His wife later admitted that she had known her husband was still alive, saying, "Yes, that's him. My sons will never forgive me. They knew nothing. They thought John was dead. Now they are going to hate me."
The Daily Mirror said Darwin was being investigated for alleged fraud involving mortgage policies, pension payouts and property deals.
Detectives say they want to speak to Anne Darwin "as a matter of urgency." She is expected to be arrested on arrival in the U.K.
"I don't want to go to jail," said Anne. "I really don't think I could cope. I just don't. I'm not strong enough. And as for John, he's a former prison officer, what would it be like for him? He'd have a terrible time."
