Liberal donor ordered to pay millions
Businessman ‘mastermind’ of fraud: BCSC
The B.C. Securities Commission has levied millions of dollars in penalties against a high-profile businessman who touted his political connections to investors before regulators ruled he was the mastermind of a large-scale fraud.
Paul Se Hui Oei used his various companies to divert 63 investments totalling more than $5 million, a securities commission panel found in December. And in a sanctions decision handed down Wednesday, the commission ordered Oei and his Richmond-based company Canadian Manu Immigration and Financial Services to pay penalties totalling $5.5 million and to repay $3.1 million to investors. Oei was permanently banned from acting in various capacities in the securities markets.
“Oei was clearly the mastermind of the fraud perpetrated on the investors,” the panel wrote.
Postmedia has reported extensively on Oei’s case, including how he gained the confidence of Chinese investors by promoting his connections to top Canadian politicians such as former B.C. premier Christy Clark and Prime Minister Justin Trudeau. Last year, the securities commission heard Oei had investors transfer money into a legal trust at Peschisolido & Company, a Richmond law firm that was then directed by lawyer Joe Peschisolido, now the Liberal MP for Steveston-Richmond East. Peschisolido was not available for comment Wednesday, but in legal filings he and his firm have denied wrongdoing.
Records show Oei was a donor to both the B.C. Liberals and the federal Liberals. The B.C. Liberals have decided to give away funds donated by Oei, but no decision has been made about where or how to distribute the money, a party representative said Wednesday.
B.C. Liberal spokeswoman Meghan Pritchard said the party has asked the securities commission to help it determine how to handle the donations. “We will continue our efforts to ensure that all the contributions in question are dispensed with appropriately.”
The $5.5 million in combined penalties for Oei and his company rank among the highest handed out by the commission in the last two years. However, the commission’s record for collecting fines has come under scrutiny recently. Over the last decade, it collected less than two per cent of $510 million in fines and orders to refund proceeds of fraudulent activities, Postmedia reported this year.
The Vancouver Sun’s series on securities regulation failures also reported investment frauds in B.C. rarely face criminal prosecution.
RCMP Staff Sgt. Annie Linteau said Wednesday she could not comment on Oei as the RCMP does not confirm investigations unless they result in criminal charges. But speaking generally, Linteau said the RCMP’s financial integrity section shares information with other agencies “to identify individuals in the capital market industry that are believed to be violating either regulatory or criminal” laws.
“Each case is based on its own merit as to whether or not the RCMP would entertain investigating it,” Linteau said. “Some of the criteria would include, but are not limited to, public interest, if the integrity of the Canadian economy or capital markets was at risk, the number of victims, the amount of losses.”
Before Oei’s sanctioning by regulators, he was a prominent figure in Metro Vancouver, mentioned in both the New York Times and the New Yorker magazine in 2016 stories about Chinese elites in Vancouver known as “fuerdai,” a term described as a “Mandarin expression, akin to trust-fund kids, that means ‘rich second generation.’
“For fuerdai seeking to establish themselves in Vancouver,” the New Yorker reported in 2016, “(Oei) is the go-to fixer and an unofficial ambassador.”