17 November 2017 0 Comments Posted By : DAN LEVIN

He Promised Riches and Entry to Canada. Now He’s the Subject of a Fraud Case in Vancouver.

VANCOUVER, British Columbia — In the tightly knit world of Vancouver’s wealthy Chinese immigrants, Paul Se Hui Oei stood out for his ties to some of Canada’s most powerful politicians and his mastery of cultivating guanxi, or personal relationships, that attracted legions of Chinese clients eager for his assistance in gaining a legal foothold in Canada.

But behind closed doors, the authorities say, Mr. Oei, a prominent immigration consultant and philanthropist, ran an elaborate fraud scheme, pocketing nearly $6 million from investors, including many Chinese citizens led to believe their investment would help them secure permanent residency in Canada. Instead, the authorities say, he spent the money on luxury cars, beauty pageants and donations to the British Columbia Liberal Party.

“Everything he said were lies,” said Chen Wei, a Chinese immigrant who testified earlier this year in a case against Mr. Oei before a British Columbia Securities Commission panel. Mr. Chen’s family invested one million Canadian dollars ($782,000) in Mr. Oei’s project, according to hearing transcripts.

The case is part of a pattern, experts say, of problems with Canada’s immigration programs, which, like the United States, set aside coveted residency permits for foreign investors. Some also say it underscores a troubling flaw in the Canadian justice system, which often allows white-collar criminals to walk away with little more than a slap on the wrist.

Mr. Oei has denied the accusations, but even if he is found to have committed fraud, he will face financial penalties only, not prison time.

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“Canada doesn’t take financial crime seriously,” said Christine Duhaime, a lawyer in Vancouver who specializes in laws dealing with terrorist financing and money laundering.

Mr. Oei, who immigrated to Canada in the 1980s, declined interview requests through his lawyer.

The case against Mr. Oei was brought by the commission, an independent provincial regulatory agency. The panel, appointed by the government, is expected to rule on the case this month. Apart from the financial penalties, Mr. Oei faces a possible ban from working in the securities industry.

In Vancouver, Mr. Oei owned an immigration consulting and financial services company, and sought to use his connections in the Chinese community to raise money for a recycling start-up, Cascade.

But the commission says that from 2009 to 2013, Mr. Oei told investors that the project was approved by the British Columbia government (it was not) and that their investments would give Chinese citizens the right to immigrate to Canada, as well as shower them with profits. All they had to do was transfer funds into the trust account of a local lawyer and member of the Canadian Parliament, Joe Peschisolido.

“This made investors feel safe, and that their money would be safe,” Mila Pivnenko, one of the commission lawyers, told the panel. “Of course, Oei was the only person who directed the lawyer where to disburse the funds from the trust account.”

The commission said Mr. Oei secretly transferred millions of dollars meant for the recycling company into his own bank accounts and issued shares in companies with no assets to investors in order to avoid detection.

Mr. Oei raised about 13.3 million Canadian dollars ($10.5 million) from 64 investors, but the commission says he kept 6.9 million Canadian dollars for himself. When Cascade went bankrupt in 2013, Mr. Oei told many investors they could recoup their money if they topped up their investment, without alerting them that he had never sent more that half the funds he had already raised from investors to the project, the commission said.

Jiang Yicheng, 53, a businessman from China’s coastal Zhejiang Province, said in a phone interview that during several visits to Vancouver, Mr. Oei chauffeured him and other Chinese investors around in a BMW, hosted lavish meals and showed off photos of himself posing with Canadian elected officials.

Mr. Jiang was sold. He formed a consortium of Chinese investors who transferred more than $3 million for the recycling company, convinced by Mr. Oei’s promises that the project was backed by the government and would allow him to immigrate.

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