Chinese Gangs and Canadian Real Estate, The Odd Correlation

[shadowmouse]

I ran across this looking something up for another thread. It has long since been buried, but I thought it might be interesting enough to float it separately.

https://betterdwelling.com/chinese-g...d-correlation/

Triads In Canada

Triads operate in every large Chinese population, and Canada is no exception. In fact, Canada is home to some of the oldest, largest, and wealthiest triad families in the world. Most of their membership is concentrated between Toronto and Vancouver.

When Wo Shing Wo, the oldest triad branch, decided to set up a foreign syndicate in 1930, the location they chose was lucky Toronto. They were soon followed by other families like Sun Yee On (the largest syndicate), as well as other groups like 14K. At one point triads were so prominent in Toronto, the Toronto Police Services (TPS) had an Asian Organized Crime Task Force. This unit became later known as the Gun & Gang Task force, since crime became so multi-ethnic in their city. Cute, right?

The triads in Vancouver go back over 100 years, and have close ties with Hong Kong branches. It’s estimated that they produce 70% of Canada’s meth, and export to the U.S. and Australia. Additionally, a US Congressional report titled Transnational Activities of Chinese Crime Organizations, notes that Vancouver is the “central distribution point [of heroin] for North American sales.” It’s gotten so bad the US Drug Enforcement Agency setup shop in Vancouver to assist with intel.

Vancouver’s triads have been making the news more often recently. Pressure from China led to an immigration hearing in 2013 for Vancouver-based Lai Tong Sang, who was revealed to be the leader of the Shui Fong triads in Macau. More recently, a Vancouver real estate agent was accused of threatening a local business owner for discouraging bidding wars.

“I’m telling you – people above me are from Harbin [China] gangs. Gangsters, right? You don’t want to be alive,” said a voice on a recording in Mandarin. The call was allegedly from a number connected to Layla Yang, a talented realtor that has a knack for selling multi-million dollar teardown properties. She’s so talented in fact, that this property in dispute was already sold by her earlier in the year. I really need to work on my sales skills.

China’s Crackdown On Triads

In 2013, President Xi Jingping was appointed to centralize power in China with a mandate to remove corruption. Since taking power he’s cracked down on thousands of politicians for collaborating with criminal groups, or embezzling money from the state. Even the mother of Vancouver mayor’s girlfriend was swept up in the crackdown.

20 years ago, Sidewinder alleged that China’s government was working with organized crime. Years later, under a new President, China is making moves to clean up the corruption. This recent clean up implies that individual politicians may have been collaborating with organized crime, and the Communist Party is now putting a stop to it. Pro-Beijing newspaper Sing Pao recently accused Hong Kong’s chief-executive of using triads to manage the city. Heck, even legislators in Hong Kong are saying triads are being used by the government of Hong Kong.

The full article is a good bit longer and goes into details, but this should be enough to let you decide if this is interesting enough to take a look at the whole thing.

What do you think? I'm aware of the Triads in a general sense, but to me they tend to be characters in Hong Kong movies more than something I associate with Canada and their real estate market. I found it interesting that this was something predicted in a report 20 years ago, and now it seems the report wasn't that far off base.

[Rennadrel]

That would likely explain why there are so many "millionaires" from China immigrating to Canada. They didn't earn the money through hard work, but through criminal activity.

[Doctor Amadeus]

I’m not Asian don’t really know or have any Asian friends. So most of my experience is through the media. However with that being the case I don’t know anything about The Triad or Yakuza. I guess if like anything like the mob, bloods, crips or MS-13 I hope the police take them out. I also hope this is an opportunity for good people of all communities to stand up.

[shadowmouse]

That would likely explain why there are so many "millionaires" from China immigrating to Canada.

I'm not sure I'd go that far. Check the main article, they have a short write up on some of the tricks:

WTF Are Smurfs?

China’s rich foreign buyers engage in the same technique that drug dealers, human traffickers, and counterfeiters do, smurfing. Smurfing is when a large amount of capital is broken down into smaller, more discrete amounts. These smaller amounts don’t attract regulatory scrutiny, and sail through the banking system.

Basically, the money is broken down into US$50,000 increments. The money is split amongst your friends, family, or a shadow banker. They then transfer the money to you while you’re here. The person in Canada also needs to open multiple bank accounts to receive the money. This way the Chinese government doesn’t immediately realize what’s happening.

They repeat the process until they have a downpayment. They then repeat as many times as they need to bring the rest of their money over. A wrongful dismissal case at CIBC in 2014 shed a little light on this process. The defendant described this as a “practice CIBC supported”.

It’s important to note that this isn’t a process being used exclusively for illicit money. It’s the process that needs to be used for all money to leave China, and doesn’t violate any Canadian banking laws. Doesn’t matter how someone made that money, selling heroin or socks, it’s all the same to Canadian banks.

So, if you were a member of a criminal organization like the triads, who needed to launder money why wouldn’t you take this fairly simple and routine route instead of the more illegal one? There are already a number of legitimate immigrants coming to Canada, so it would be hardly noticeable if a handful of them happened to be triads. Well, until abandoned teardown houses started going for $3 million dollars. Then locals definitely started getting suspicious.

This Isn’t A Secret…Unless You’re Canadian

The lack of legal framework and resources to prevent money laundering in Canada is far from a secret. Canada is one of the world’s largest tax havens, and has banking laws that have a number of loopholes. While your everyday Canadian may not know this, both the Asia Pacific Group on Money Laundering (APG), and Transparency International have openly made statements.

APG has noted Canada’s questionable money laundering prevention techniques multiple times, including in their latest Mutual Evaluation Report (MER). The MER notes that Canadian authorities “may be underestimating the magnitude of key risks”, such as those “emanating from tax crimes and foreign corruption.” They further note that while Canada has an Anti-Money Laundering (AML) regime, a notable exception is legal professions other than British Columbia notaries. This is a “significant loophole in Canada’s AML framework”, and “in particular the real estate sector.”

Transparency International was perplexed by the promises Canada made earlier this year at the Anti-Corruption Summit in London. Apparently we sent a delegation that made a number of promises. Over the summer, a review committee researched the promises and noted they were “not new”. This begs the question, are the money laundering loopholes there through negligence or design?

I guess if like anything like the mob, bloods, crips or MS-13 I hope the police take them out.

In general, think bigger. Read the bolded part that follows and try to imagine it, because it is pretty mind boggling.

What Are Triads?

Triads are a secret fraternal society that police forces claim engage in organized crime. They’re kind of like the Sicilian Mafia, but bigger and Chinese. It’s alleged they dominate illicit markets around the world. They’ve cornered the market on human smuggling, heroin, and money laundering. Recently they’ve transformed from a violent street gang, to favoring more discrete operations. They also engage in legit businesses like entertainment and property development.

They’re based out of Hong Kong, where membership is theoretically illegal. Despite this, two operations to crackdown on membership last year led to the arrest of 60,000 members. Yes, that number is correct. The kicker? It hardly put a dent in triad operations.