The past few decades have seen major changes in my hometown of Vancouver, once a sleepy provincial city nestled between the Pacific Ocean and towering mountains, known as much for its laid-back lifestyle as its natural beauty.
The scenery hasn’t changed, but these days you’re more likely to notice Ferraris and other luxury vehicles cruising the tree-lined streets. And you may have heard about the city’s stratospheric property prices –– an inescapable subject of conversation whether at the beach, the bar, or a backyard barbecue.
Vancouver skyline with high-rise buildings containing high-priced condos.
Photo credit: Gary, CC BY-SA 2.0, via Wikimedia Commons
There are a few factors cited for the real estate market insanity, but one of the most alarming is the role of money derived from international crime and corruption. The British Columbia government was so concerned that it requested multiple public reports. The government also set up a commission that recently released its findings after spending close to three years interviewing experts about money laundering and poring over documents.
But there are glaring omissions from these reports — the names of people behind the money laundering, where the money came from, and how it was poured into real estate. I decided to dig in and try to answer some of these questions, and I enlisted Rob Cribb at the Toronto Star to help.We found quite a story.
A Chinese property developer who changed his name to Runkai Chen after moving to Canada declared a modest income to immigration officials, yet managed to move at least CA$114 million into the country. He and his daughter –– who declared her profession as “student” –– both own mansions with a combined value of at least CA$31 million.
Our investigation showed that the money came from land deals with a general involved in one of China’s largest-ever military corruption scandals. Although Chen told us he is innocent, China issued an international arrest warrant for “bribery.” A follow up story focused on the failure of major Canadian banks to flag the suspicious transfers of money coming into Chen’s accounts.
The response to our reporting was immediate.
British Columbia’s attorney general used the investigation to highlight Canada’s broken system for tracking money laundering.
An opposition member of Parliament cited our investigation in criticism he leveled at the government for inaction. The Minister of Public Safety responded in the House of Commons in Ottawa, saying the government has promised more resources for law enforcement to fight money laundering and to create a Canadian financial agency.
One reason the story created such a stir is that so many people are being priced out of the market in Canadian cities.There are increasing concerns about the role of money laundering in this phenomenon, but there has been little investigative journalism to uncover it. We hope to expose even more cases like this in the future, in Canada and beyond.
