Canada : We want only clean money !
Exclusive: Canada plans forensic audits of millionaire migrants’ finances
PUBLISHED : Tuesday, 09 December, 2014, 11:27am
UPDATED : Wednesday, 10 December, 2014, 1:36am
Ian Young in Vancouver [email protected]
Would-be immigrant investors stage a press conference in Beijing in March to express their disappointment after the Canadian government shut down its immigrant investor programme. A replacement scheme will subject applicants to tougher scrutiny. Photo: Simon Song
Applicants to Canada’s new millionaire migration scheme will have their finances subjected to an intensive forensic audit by private-sector accountants, government tendering documents have revealed.
This document posted on a government procurement website outlines the intense scrutiny millionaire migrants will face under Canada’s Immigrant Investor Venture Capital scheme. Source: Public Works and Government Services Canada
The auditors will also be required to investigate whether applicants have any criminal past or whether they are “politically exposed”.
The unprecedented scrutiny could act as a deterrent to some wealthy mainland Chinese, who made up a large majority of applicants to the now-defunct Immigrant Investor Programme, which is soon to be replaced by the Immigrant Investor Venture Capital (IIVC) scheme.
Details of the IIVC programme have yet to be officially unveiled by Ottawa, but documents on a government procurement website reveal that Citizenship and Immigration Canada is seeking private-sector expertise to ensure that all applicants meet the scheme’s wealth requirements, and that their fortunes have been legally obtained.
Among the mandatory requirements of those seeking the auditing tender, which closed on Friday, the documents list “expertise in conducting integrity and due diligence checks on individuals”, and “expertise in accounting (including forensic) and business/asset valuation”.This document posted on a government procurement website outlines the intense scrutiny millionaire migrants will face under Canada’s Immigrant Investor Venture Capital scheme. Source: Public Works and Government Services Canada
The auditors will also have to confirm whether an applicant has any history of criminal activity and whether they are a “politically exposed person”. The documents did not elaborate on who this might include.
A Canadian immigration industry source said the audit “would present certain problems to certain individuals, from certain countries”.
Although applicants to the old IIP were also required to confirm that their wealth was legally obtained, the scrutiny was much less rigorous than that promised under the new scheme, said the source, who was consulted by Citizenship and Immigration Canada on its plans.
“Now they are talking about a third-party, private-sector, accountable audit, as opposed to an immigration officer looking at a bunch of numbers and trying to come up with a sound rationale for whether the funds were obtained illegally or not,” the source said.
“Presumably one of the large accounting firms, or two or three large accounting firms, will qualify to perform these [audits], and I believe that their structural understandings will be more formal and less subjective than those employed by immigration officers in the past.”
The old IIP was shut down in June, resulting in about 60,000 rich applicants and their dependents being axed from the immigration queue, including some 45,000 mainland Chinese. That scheme had required immigrants worth a minimum of C$1.6 million to loan Canada C$800,000 interest free for five years, in return for permanent residency. It was widely criticised for allowing immigrants to buy their way into Canada.
The government promised that the scheme would be replaced with the IIVC programme, but immigration industry sources recently told the South China Morning Post that the new scheme would be tiny in comparison, only approving about 50 applications per year.
Beijing has long complained that Canada’s immigration system has played a role in harbouring Chinese criminals. Last month, Xu Hong, director-general of the Chinese foreign ministry’s department of treaty and law, told a press conference that Canadian and US judges were “prejudiced” against mainland courts and thus reluctant to repatriate businessmen and officials who were fugitives from Chinese law.
According to an account by Reuters, Xu said Canada and the US were the two immigration destinations most favoured by Chinese economic criminals. Neither Washington nor Ottawa has an extradition treaty with China.
Under the tender criteria for the IIVC scheme, applicants will have to submit documentation that allows auditors to finalise their checks in three weeks. This could be extended if required by the auditors. “If the reason for not being able to conduct the required work within the established timelines is the lack of cooperation from the Applicant, this should be indicated in the report,” CIC warns.
The report would be initially submitted by the auditors to the applicant, who would then pass them on to CIC with their completed application. This would apparently give applicants whose audits reveal criminality or other dubious activity the opportunity to abort their applications.
CIC has declined to reveal the financial details of the IIVC scheme before its official launch, which is expected within weeks. However, two immigration industry sources told the Post they were consulted by CIC about the scheme and were told applicants would get permanent residency in exchange for investing C$2 million in a venture capital fund. The applicants would get no say in how their money was invested by the fund’s managers.
A report in the Wall Street Journal last month said the investment per applicant would be C$1 million to C$2 million, and that the target size of the fund would be C$120million, suggesting 60 to 120 applicants would be accepted.
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