Canada

CSIS Warns of Chinese Influence On Canadian Real Estate…20 Years Ago

RCMP and CSIS Warns of Chinese Influence On Canadian Real Estate...20 Years Ago - Sidewinder

Remember when the RCMP and CSIS accused the Chinese government of purchasing real estate in Canadian urban centers as a method of threatening Canada? No? That’s because the recommendations from a former classified program called Sidewinder was abandoned. All documents were ordered destroyed, and buried in 1997 by the Liberal government. Turns out we were as anxious to build ties with China then as we are now. Despite our national spy services advising the government that, well…this would happen to real estate.

In a report titled Chinese Intelligence Services and Triads Financial Links in Canada, an RCMP-CSIS joint task force allege that the Chinese government is using legal and legitimate businesses to gain control over the economic levers of Canada. They also warn that the “Canadian economy is concentrated in three or four large urban centres.” Consequently, “[Canada] is more vulnerable [than other countries] because of the many legislative loopholes governing finance and the concentration of financial power in the hands of few”.

20 years ago, when people thought Barbie Girl was great music, this seemed like our top spies were spinning a far-fetched conspiracy theory. Analysts even referenced how far fetched it seemed in the actual document. They preface the report with “this document does not present theories but indicators of a multifaceted threat to Canada’s national security based on concrete facts drawn from the databanks of the two agencies involved [the RCMP and CSIS].”

The report also warns that “if you look at a single individual, the threat does not seem to be there, but because of their associations and their alliances with China, the facts analyzed lead us to believe that a gain of influence is the object of a concerted plan and that could constitute a threat to Canada.” Reading the details today, these ideas seem less far-fetched than ever.

“China remains one of the greatest ongoing threats to Canada’s national security and Canadian industry.”

Chinese Intelligence Services and Triads Financial Links in Canada

Chinese Billionaires, Gangsters, and Spies

Canada’s top spy agencies claimed that they have identified distinct groups of people that are “working with the Chinese government to gain influence through some of their ‘financial ventures’ in Canada.” They further allege that the Chinese government is using tycoons, triads, and spies to “attain influence over the economic levers and prominent Canadian figures”.

Chinese-Canadian Tycoons
Well known (and loved) Chinese-Canadian business tycoons are said to be a threat. Stanley Ho (Casino barron, former owner of Ramada), and Li Ka-shing (founder of Concord Pacific) are both named in the report for their aggressive investments in Canadian real estate, and financial institutions. At one point they estimate that Li Ka-shing and his son owned at least ⅓-⅙ of downtown Vancouver at the time. The report also notes the recent buy of 18 hectares by the CN Tower, which is over 1% of downtown Toronto.

The report claims that the two were selected by Beijing to be the unofficial leaders of Hong Kong after the departure of the British. While Sidewinder doesn’t explain why they’re concerned, the American government lays it out on the table. The US government wrote in a report that the RCMP identified Ho as having links to Kung Lok, a branch of the Triads.

Canadian analysts don’t quite say why Li Ka-shing is on their radar. They do infer that his acquisition and interest in Canadian banks is worrisome, but not why. When China launched CITIC, a state-owned investment firm, Li Ka-shing was appointed to the first board of directors. Additionally the U.S. Embassy in Beijing has claimed Li Ka-shing’s Hutchinson Whampoa is “financing or serving as a conduit for communist China’s military”. So maybe that’s it?

Hong Kong’s Triads
The report also alleges that Triads have developed large businesses in Canada, both legitimate and not-so-much. For those that don’t know, the Triads are one of the largest organized crime groups in the world. They have significant operations in Canada, mostly around Vancouver and Toronto. They’re discreet and intelligent, not street goons. Police forces around the world allege they do everything, from drug trafficking to smurfing. Although they do have much more legitimate operations, like making movies and real estate development.

The report claims Beijing is giving them a free pass in exchange for sharing influence. RCMP-CSIS analysts also claim they have identified triads, amongst legitimate immigrants, using “investor” and “entrepreneur visas” to come to Canada. They note that Canada is an “excellent place to invest in companies to launder the profits derived from criminal activities while securing a portion of their assets outside of Hong Kong and obtaining a Canadian passport.” Back then they must’ve been unaware that Canada is an excellent place to launder any money.

Chinese Spies
The report also accuses the Chinese Intelligence Service (ChIS) of using specialists, students, and shell companies to “pursue their acquisition of economic intelligence.” They additionally claim that ChIS is attempting to position themselves in a way in which they can impact the management of the country.

Real Estate, Banking, and Technology

Sure, we watch television. We know spies are sent around the world to gather military and economic secrets. What’s interesting in this report is something that’s been undiscussed for 20 years. RCMP-CSIS analysts claim China is after “soft” sectors, such as “real estate, hotels, transportation, oil companies, and travel agencies”.

Activity in “soft” sectors doesn’t attract the scrutiny of larger, regulated industries. A look at Lenovo’s rejected bid for handset maker Blackberry vs. Anbang’s successful bid for the Bentall Centre in Vancouver is an example of this. The former received great scrutiny because it was technology, the latter not so much. The analysts further noted that investments in commercial sectors “at first site do not involve any security risks and did not attract the attention of the Canadian services responsible for security.”

They go on to say “the scale of their venture or investments has now made them some of the most important figures present in the major centres [of Canada], and their decisions to invest in one place or another are not a matter of indifference to anyone. Such projects are seen by the local or national business community as a ‘favour’ or a ‘chance’ not to be missed”. Sounds vaguely familiar.

Influence In Politics

The report notes that they’re not interested in Canada because of our sweet maple booty. It’s because of our political influence. They allege that the 3 groups of people are attempting to control our political base. According to the report, there’s two methods in which they use – donations and constituency.

“The triads, the tycoons, and ChIS have learned the quick way to gain influence is to provide finance to the main political parties. Most of the companies identified in this research have contributed, sometimes several tens of thousands of dollars, to the two traditional parties, that is, the Liberal and Progressive-Conservative Parties.”

Those sentences are concerning for two reasons: First, terrible grammar. Second, politicians feel a sense of duty to repay political donors. At the very least, they often grant them favours to keep the money flowing for campaigning. We restrict foreign donations to our political parties for this reason. Unfortunately, what happens when “domestic” companies make donations to help foreign influence? We can’t do a whole lot about that, now can we?

“The triads, the tycoons, and ChIS have learned the quick way to gain influence is to provide finance to the main political parties. Most of the companies identified in this research have contributed, sometimes several tens of thousands of dollars, to the two traditional parties, that is, the Liberal and Progressive-Conservative Parties.”

Leveraging Legitimate Desire

No, the report isn’t racist and thinks the whole country should be on edge with all Chinese people. In fact, the analysts say the “great majority” of Chinese immigrants are “legitimate”. They allege that spies and triads are hiding amongst the ranks of regular families. Despite this, the report claims “Canadian authorities detected a significant presence of Chinese organized crime” using Canada’s generous immigration schemes.

Notably present in the table of contents but not included in the draft is a section on Canadian schools. A copy hosted by retired police officer Leo Knight has a section called “University of Toronto and University of Western Ontario”. The actual information was redacted unfortunately. I guess we’ll never know what mysteries our universities and student visas contain.

It’s Probably Nothing…Sidewinder Gets Disbanded

Operation Sidewinder was abruptly disbanded before the document was leaked. Apparently all copies were ordered destroyed, and the “rest were lost”. No one’s quite sure who ordered the documents destroyed. It’s believed the project died under pressure from within and outside the agencies.

The internal struggle reads like an argument between kids, then covered up by the oldest one. Senior RCMP officials say CSIS officials tried to alter information and delete materials in ways that “undermined the report’s integrity”. CSIS claims the report did not meet the analytical rigour. The Security Intelligence Review Committee (SIRC) did a final investigation into the matter, and claimed the report was “deeply flawed”. They did determine that the final draft was up to standard, but it did not present a credible threat.

They also disclosed in a second report that documents were improperly handled. One agent in Toronto had his car broken into, and files stolen. They concluded “petty thieves intent on supporting a drug habit” committed the crime. They also say the classified documents stolen were “unread”, disposed of in a dumpster, and emptied at a landfill site…but they were never recovered. Which is a lot of details considering they have no idea what happened after the burglary.

Political Response To Sidewinder

As you can guess, this report didn’t sit well with anyone in government. It alleges a powerful country is conducting a spy mission, using influential Canadians. They even scrutinized a company whose board Prime Minister Chretien’s son-in-law sat on. The company was China’s state-run CITIC, but still. Right or wrong, it wasn’t going to sit well.

The whole report went mostly silent, with a few exceptions. Once, when RCMP officers involved filed an obstruction-of-justice complaint. They alleged senior officers covered up their investigation. Another time in Parliament, when they noted that whistleblowers are punished in Canada. They used two of the CSIS agents that had their careers ruined shortly after Sidewinder as an example.

Most notable was in 2010, when then CSIS director Richard Fadden mentioned it in a CBC interview. He alleged two BC cabinet ministers are under the influence of foreign governments, but didn’t substantiate the claims. Afterall, it’s not like Vancouver’s politicians are flying China’s flag over city hall or anything. Wait, that happened? That’s six kinds of weird. Vancouver Mayor Gregor Robertson said at the time “it’s frustrating and unfortunate that local elected officials in BC had aspirations cast upon them without any justification”. Yeah, that Gregor.


Raising of China’s flag at Vancouver city hall, to the tune of Canada’s national anthem.

Seriously, WTF?

I know, bringing up Sidewinder brings up more issues than it clears. In fact, some of you might think this was a hate piece written to attack the Chinese and politicians. Completely not my intention. In fact, I receive at least a couple emails a day saying I’m too pro-China for some of my articles.

Our point was, often we sweep things under the rug because they’re uncomfortable to talk about. We do so at our own peril. Canadian politeness often gets taken advantage of by politicians, businesses, and (if we believe our top spies) foreign countries. In exchange, we seem nice but get Royally screwed. I’m just one Canadian though, what do you folks think?

Drop us a comment below, or share this with a friend and discuss. We’d love to hear what Canadians think about the Sidewinder report 20 years later. We’ll be exploring how crazy Sidewinder is over the next few posts. Like us on Facebook to be notified when the next post goes live.


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19 Comments

  • Reply
    Anna 2 months ago

    Honestly, if Canada’s spy agency writes a full report that recommends we investigate something – I don’t think we should be able to ignore it.

    These reports aren’t just a whim of a few idiots, they’re years of research with an accompanying “facting” binder with each and every line backed up by concrete evidence. Ignoring it was just plain dumb.

    • Reply
      Victor 2 months ago

      The problem is the massive number of morons that will say it’s racist to properly screen immigrants. If you’re going to move to Canada, you should expect a decent amount of screening. It takes 15 years to move to the US from China. Canada? 3 years tops.

  • Reply
    Jason 2 months ago

    I thought Harper was shitty, but the more I read about government during Jean Chrétien I’m shocked. He makes Harper look like an angel – not an easy task.

  • Reply
    Alice 2 months ago

    I would trust any four of those mounties in the photo before I trust a real estate agent.

    • Reply
      Marco 1 month ago

      That’s not very nice… im a real estate agent. Great article though, I wish it got major network news attention

  • Reply
    Paul Eichmann 1 month ago

    Its too late now they own most of the greater Vancouver area both at the high end of residential real estate and also large swaths of commercial and industrial properties throughout the downtown core, business district and surrounding areas. Its also not isolated in just in Vancouver, in the past few years thousands of acres on Vancouver Island its surrounding islands have been purchased by Chinese nationals including large business and tourist venues in and around Vancouver Island.

    • Reply
      Douglas 1 month ago

      Not too late. Find those involved in conspiracy and appropriate ALL of the real estate to the state to be redistributed in legitimate sales by legitimate buyers. The State must act in the best interest of the people and I see no problem using the heavy hand of the state to go after this type of activity and banks such as HSBC which is a notorious cartel bank. Purge the system. Down with the traitorous elites.

  • Reply
    Sum Tin Wong 1 month ago

    Dear Canadians. I am an Indian Canadian. Please dont mistake me for a white worshipper . But truth be told I really think you guys need to take your country back. You guys are being too nice. And when your too nice people take advantage off you – to their benefit.

    I think the Chinese are probably Canadas and North Americas worst enemy. Canadians are selling their souls to the devil for short term gains. Politicians and Banksters are allowing their untraceable cash to drive up real estate prices to unrealistic prices and drive out the domestic buyer. They create mini China towns that only serve their people and interests. The are evading millions in capital gains taxes through loop holes, they only get themselves rich. The issue is your banks are the ones going to be stuck with this mess when the bubble pops. Leaving Canadian taxpayers to bail out the situation.

    Also don’t say its racist when you point out the chinese for espionage activity. Its what they do best. Its how they rob your technology take it back home and create duplicates for a fraction of the cost.

    –No uncle tom

    • Reply
      Koochi 1 month ago

      Whoa.. Pot calling the Kettle black.. Have you heard of a town called Brampton and most part of Missississauga in Toronto?

  • Reply
    kai chen 1 month ago

    Of course its only a problem when someone non white is running the show. This appears to be the sentiment of all commonwealth countries.

    Us Chinese were suppressed by the west for centuries. Its our time to rise. Except we use our brains to outsmart our competition. Not like your ancestors did with guns.

    You cannot stop the rise of china. We will rule the world. We already own Canada

    • Reply
      Douglas 1 month ago

      Can’t wait to see your smug face when we become like our ancestors once again. This is nothing to do with white or non white. We have respect for legitimate rule. You try to rule as thieves, cheats, and liars. Not truth, power, ingenious or any noble characteristic.

    • Reply
      Truman 1 month ago

      In your racist dreams maybe.

  • Reply
    Brian 1 month ago

    The lower the Canadian dollar goes, the greater the foreign interest in buying Canada’s real estate, resources, and businesses is. Canada is a bargain for wealthy foreigners and their purchasing power eclipses that of Canadians. China, in particular, can take control of a country and, as it is now doing, influence politicians and business people to do what is in China’s, not Canadian’s, best interests. The Canada-China trade treaty is an example of that.

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    Kelly Ellard pregnant in jail | Modern Heartbreak 1 month ago

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    Canada: CSIS Warns Of Chinese Influence On Canadian Real Estate…20 Years Ago | Knowledge Hub 1 month ago

    […] Remember when the RCMP and CSIS accused the Chinese government of purchasing real estate in Canadian urban centers as a method of threatening Canada? No? That’s because the recommendations from a former classified program called Sidewinder was abandoned. All documents were ordered destroyed, and buried in 1997 by the Liberal government. Turns out we were as anxious to build ties with China then as we are now. Despite our national spy services advising the government that, well…this would happen to real estate. Read more on: betterdwelling.com […]

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    […] RCMP-CSIS analysts made some pretty bold claims in their 1997 Sidewinder report. The statement that Chinese Triads are manipulating real estate is one of the boldest. Back then, it seemed absurd that organized crime would focus on Canadian real estate. 20 years later, we wanted to take a look at just how crazy that seems now. […]

  • Reply
    M. Lea 1 month ago

    It’s old-fashioned Imperialism that’s been foisted on us by a currently powerful nation just like the British in India and the US in Latin America. The way it works is, a foreign government buys off local elites who facilitate the take-over of their own country. Successive Liberal & Conservative governments have sold us out for their own gain and the benefit of the elites that fund them. The real question is why Canadians keep re-electing these parties time after time when it’s clear that their policies are undermining our economy, society & environment.

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