China Cracks Down on Immigration Firm Once Represented by Ex-Ambassador McCallum; Expert Fears Data Breach

Chinese paramilitary policemen stand guard on a street in Shanghai on Oct. 5, 2021. Hector Retamal/AFP via Getty Images

Police have reportedly arrested the president of Wailian Group, a major Shanghai-based company that helps people immigrate to Canada and various other countries. The case has sparked concerns about the potential transfer of client information to Chinese authorities.

Former Liberal cabinet minister and ambassador to China John McCallum reportedly once acted as a representative of the company in Canada.

On Aug. 10, the Shanghai Public Security Bureau announced on WeChat that it has successfully cracked down on “an illegal foreign exchange transaction case” involving an immigration services company. Five individuals have been arrested in connection with the case. The police said the illegal foreign exchange transactions involved a sum exceeding 100 million yuan.

Several local media outlets reported that among those detained is He Mei, president of Wailian Group. The company claims to specialize in helping individuals immigrate to countries such as Canada and the United States. Its official website advertises immigrant investor plans that expedite relocation to regions like British Columbia in as short a time as six months.

According to local media, Chinese authorities allege that Wailian used a strategy involving collecting Chinese yuan, or renminbi, within China and providing foreign currency overseas in a manner that police said constituted illegal foreign exchange transactions for third parties.

Additionally, authorities allege company employees engaged in criminal acts by collaborating with underground money changers to facilitate unlawful currency exchange.

While the statement from the Shanghai police did not explicitly mention the seizure of client information, some critics have voiced concerns about this possibility, including Cai Xia, a former professor at Beijing’s Central Party School, China’s top school for training Party cadres.

“Insider sources revealed that the police demanded that Ms. He provide all client information from the decades she has been handling immigration cases,” Ms. Cai wrote in Chinese in a post on X, formerly known as Twitter, on Aug. 9.

The Epoch Times reached out to Wailian Group for comment but didn’t hear back by press time.

Foreign Exchange Control

Zhang Lei, a U.S.-based Chinese political commentator, raised concerns that the alleged arrest of Ms. He signals that Chinese authorities are cracking down on the immigration business in the country.

In China, companies, banks, and individuals must comply with a “closed” capital account policy, meaning they cannot freely move money into or out of the country unless they abide by strict foreign exchange rules, according to the website of the Canadian Trade Commissioner Service in China.

Under regulations outlined by China’s State Administration of Foreign Exchange (SAFE)—the body in charge of managing foreign exchange activities in China—Chinese nationals are subject to an annual purchase limit of 50,000 renminbi (US$6,900, or C$9,300).

However, immigrant investor programs such as the U.S. EB-5 demand a minimum investment of US$900,000, a sum significantly surpassing the purchase limit imposed on Chinese nationals.

Mr. Zhang said that under such circumstances, in order to transfer foreign currency that exceeds the annual quota, immigration services companies would need to break down the remittances into transactions of smaller amounts, which constitutes illegal foreign exchange trading.

“By announcing this charge, Chinese authorities are essentially declaring that everyone involved in an immigrant investor program has violated the law,” he wrote in Chinese on X.

He added that this case also sets a precedence for law enforcement agencies in other regions of China to investigate immigration services companies and individuals engaged in foreign exchange trading.

“This has the potential to become a substantial revenue stream for the Chinese government, reaching billions,” he said.

John McCallum

McCallum, a former Liberal immigration minister and Canadian ambassador to China from 2017 to 2019, who reportedly worked as a speaker for Wailian Group, did not reply to an Epoch Times request for comment on the crackdown.

Mr. McCallum had been the subject of conflict-of-interest concerns due to his role as a speaker for Wailian. A 2020 report by The Globe and Mail revealed that the company had paid Mr. McCallum to speak to clients in five Chinese cities. In July that year, he spoke at another event organized by Wailian, during which he promoted Canada as an appealing destination for people from China.

Peter Kent, Conservative MP and his party’s immigration critic at the time, had criticized Mr. McCallum’s work with Wailian, saying that “it would seem to be a legitimate cause for the Ethics Commissioner to at least investigate the information that is publicly available now and perhaps to consider a [formal] investigation,” the Globe reported.

In January 2019, Prime Minister Justin Trudeau asked Mr. McCallum to resign from his post as Canada’s China envoy after he provided legal arguments to Chinese media in defence of Huawei executive Meng Wanzhou, who was arrested in Canada on a U.S. extradition request involving charges of fraud.

Kathy Han contributed to this report.