‘I wanted to kill myself’ : Chinese investor testifies his family destroyed in alleged B.C. immigration-investment scam


Chinese investor Jiang Yicheng sobbed violently while telling a B.C. Securities Commission panel that his family has been ruined by disastrous financial losses in a fraud allegedly perpetrated by prominent B.C. immigration businessman Paul Oei.

Jiang is one of about nine Chinese investors scheduled to testify in the three-week Securities Commission hearing for Oei, who is a prominent figure among ultra-wealthy Chinese immigrants in Vancouver, and also a big donor to the B.C. Liberals.

Jiang’s testimony Wednesday asserted details about “black market” bank transfers that his investor group allegedly sent from China and into the legal trust of Richmond politician and lawyer Joe Peschisolido. 

In hearings so far this week, counsel for B.C. Securities Commission has accused Oei of perpetrating “a fraudulent scheme” to invest in a proposed Metro Vancouver recycling plant. The plant was planned for Port Coquitlam but never completed, and the alleged scam involving a number of Oei’s companies took place between 2009 and late 2012. Oei was supposed to invest $13.3 million raised from Chinese investors for the plant, but less than half went to the start-up company, Cascade, according to allegations. Oei used $6.9 million on expenses unrelated to Cascade, including transfers to his personal bank accounts, luxury car rentals, donations to charities, expenses for his immigration business, legal fees and commissions related to the project, and funding of beauty pageants, according to the allegations.

“He impressed by driving expensive cars and rubbing elbows with politicians,” a securities commission lawyer said this week, describing the context in which investors were allegedly cheated by Oei.

Teresa Tomchak, counsel for Oei, said he denies using investor funds that were meant for Cascade for his own purposes. Tomchak said Oei set up investments for the project as recommended by his legal counsel at the time, which was Peschisolido and Co.

Jiang and his group invested $4 million that went through Peschisolido’s law corporation, and through to Oei and Oei’s companies, the panel heard. Jiang said he and his investor group lost everything.


After a day of testimony, he was asked to tell the panel how he has been impacted in the case. He said his family’s and his wife’s parents’ life savings were lost to “swindlers.”

Jiang said his wife attempted suicide because of the loss. She was resuscitated, but when she recovered, she had lost all hope, Jiang said. He said she insisted on a divorce and he was left to father their two young children alone. Jiang said that business has now slowed down in China, and he has no hope that he can recover his losses and pay back those that he owes. He said he can’t even pay his children’s medical or school fees.

“At times I wanted to kill myself,” Jiang said, as he shook with loud sobs. “It is just because of the two children that I can’t die. Even my son said to me, ‘Didn’t you say Canada is a country ruled by law?’ I don’t know how much longer I can continue like this.” 

Oei instilled confidence in the investors — many of whom did not speak English or understand Canadian investment laws — by having them transfer funds into the legal trust of Peschisolido and Co., the panel heard this week.

Commission counsel Nicholas Isaac asked Jiang what he was told about Peschisolido and Co., prior to his investment.

“Paul Oei talked to us about this trust account and he told us this lawyer is a very famous lawyer in Vancouver and Canada. … We wired our investment funds into the trust account of this lawyer, and because we did that, we would be protected by Canadian law.”

Jiang testified on details about “black market” bank transfers used in order to wire $4 million into the Richmond politician’s legal trust for the Cascade project.

Jiang said his group had to use underground “community channel” banking methods because Chinese citizens are barred from sending more than $50,000 in U.S. dollars abroad, per year.

“This is equivalent to what the Hong Kong people call the U.S. dollar black market exchange transactions,” Jiang explained. “This is high risk, and in the beginning we were not aware of the routes. So after we exchanged a certain amount, the person in the community ran away with the money, so we incurred a loss.”

Jiang said he learned that “according to the rules in the community” his group had to pay “black market insurance” fees of from 15 to 25 per cent per transaction, in order to ensure that their investment funds were not lost in the transfer process from China, to Hong Kong or Korea overseas bank accounts, to his HSBC account in Canada, and finally into the legal trust of Peschisolido and Co.

Jiang said that because Oei wanted to continue receiving funds from Chinese investors, he agreed to reimburse the investors with a payment of “insurance premiums” of hundreds of thousands of dollars, to cover the black market fees they incurred.

This week, the panel heard that Oei used bank accounts for his company, Canadian Manu Immigration and Financial Services Inc., to receive funds from Cascade investors. And he used the numbered companies 0863220 B.C. Ltd. and 0905701 B.C. Ltd. to issue documents, “which purportedly entitled investors to Cascade shares.”

Many investors thought that based on their investment agreements they owned shares in Cascade, but the numbered company shares they actually owned had no value, the panel heard.

It was Peschisolido and Company that advised Oei to create 0863220 B.C. Ltd. and 0905701 B.C. Ltd. for the purpose of holding funds from Chinese investors, Oei’s counsel Tomchak said, and the law firm was also involved in preparing documents and agreements for investors. 

The panel was also shown in one exhibit the flow of funds from Chinese investors to Canadian Manu bank accounts, and the final use of the funds. In one line item, the panel was shown that $21,732 went from Canadian Manu accounts to Peschisolido and Co., in fees.

In separate but related B.C. Supreme Court civil actions, some of the Chinese investors involved in the case allege losses and have sued Oei and his wife, Loretta Lai, as well as Peschisolido and Peschisolido’s law firm. 

In legal responses, Peschisolido and Co. have denied that the law firm did anything wrong in the case. Lai and Oei have also denied any wrongdoing.

Oei and his wife have donated over $67,000 to the B.C. Liberals. Oei and Lai have donated $8,477 to the federal Liberals since 2014. In July 2015, Oei’s company Organic Eco-Centre Corp. sponsored a pre-election luncheon in Richmond featuring Justin Trudeau. The company was named in B.C. Securities Commission allegations against Oei. 

According to Jiang’s separate but related B.C. Supreme Court claim in the Cascade case, investors were told Oei and Lai “had connections with high-level officials in the government of B.C.” and that any person investing $1 million in Oei’s recycling plant project would be granted Canadian permanent resident status.

‘They told us that Cascade was an environment and immigration project strongly supported by the B.C. government, and there will be no problem absolutely in getting our immigration status,” Jiang said on Wednesday. “They made a promise about our immigration, that if in the event our immigration was not approved, Cascade would …  return us our money.”

By Sam Cooper

Vancouver Sun


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