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Chinese-Canadian mogul says 'erroneous' high-level security leaks have made his life 'unlivable'

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Chinese-Canadian banking mogul Shenglin Xian is demanding the RCMP find the source of national security leaks that used "manufactured intelligence" and "erroneous embellishment" to portray him and his company as potential conduits of foreign interference. 

The leaks alleged he was the target of a CSIS probe and that Wealth One Bank of Canada could be susceptible to pressure by the Chinese government and used for money laundering.

Xian’s call for an investigation thrusts the internal efforts of the national spy agency to stop leaks back into the spotlight. Both the Canadian Security and Intelligence Service (CSIS) and the Mounties began their search for the perpetrators within their ranks as foreign interference dominated debate in Parliament, ultimately triggering a public inquiry. But more than a year after launching investigations, no one has yet been held accountable.

CTV News obtained a letter addressed to the Chief Superintendent of the RCMP national security sector. In it, Xian, the founder of Wealth One Bank, calls for a criminal investigation into two unnamed employees or contractors with CSIS and a third "John Doe" who works for the Mounties.

The news comes as inquiry commissioner Justice Marie-Josée Hogue tries to balance transparency with the safeguarding of national secrets as she determines the impact of foreign interference on Canada’s democratic institutions.

Xian is not testifying at the inquiry but considers himself a "victim of a crime" by intelligence operatives who leaked what he calls partial and unsubstantiated information about him to the media. 

Public servants who break their oath of protecting state secrets can be charged under the Security of Information Act.

Accuracy of Intelligence questioned

Scrutiny of Wealth One intensified in December 2022 after Finance Minister and Deputy Prime Minister Chrystia Freeland warned in a letter to Xian and the bank's two other founding shareholders – Morris Chen and Yuangshen Ou Yang – that they could be susceptible to coercion by the Chinese government.  The minister ordered them to dispose of all their shares in Wealth One.

Their continued ownership "would pose risks to the Bank and the broader financial system of Canada," Freeland said last year. 

The contents of Freeland's letter were leaked to the Globe and Mail. They alleged that Xian, Chen and Ou Yang had been under investigation by the Canadian Security Intelligence Service (CSIS) since 2021.

In his letter, dated March 19, 2024 Xian implies that Freeland acted on bad information.

"Corrupted intelligence and false intelligence provided to the Minister of Finance resulted in an unprecedented first ever order of disposition," he wrote.

In his letter to RCMP, Xian attached two independent audits of Wealth One, which he says found no exposure of the bank to foreign interference. CTV News had previously reported on the contents of the audits. The first audit, by legal firm Bordner Ladner Gervais, found “no basis in fact to suggest the Bank had been compromised,” but could not completely rule out Xian’s susceptibility to interference because he still had family and business interests in China.

The second investigation, conducted by accounting firm Price Waterhouse Cooper, dug into Xian’s election contributions and found that he had donated federally to both Liberal and Conservative candidates.

The reports were sent to Freeland’s office but did not appear to impact her decisionto order to the primary investors, Xian, Chen and Ou Yang to divest.

Lives in tatters

Xian's lawyer, Joel Etienne, confirmed his client had filed a criminal complaint with the RCMP to stop what he calls a new form of "McCarthyism" that is against the law and harmful to democracy.

"Shenglin firmly believes that critical Canadian government and media institutions have been co- opted by a few complicit rogue individuals who have lied, embellished and manufactured false intel, leaving the reputation of many prominent Canadians, some in private, some in public lives, in complete tatters," wrote Etienne in a text message statement.

Etienne declined to answer why they believe the three individuals are involved in intelligence leaks about Wealth One. However, in a brief interview, Xian said he had also served the Globe and Mail with a notice of intent to sue. 

The newspaper did not respond to CTV’s request for comment before publication of this story.

Since the leaks about him were published, Xian says can’t open a bank account, get a credit or a debit card.

"You can’t imagine the damage to my reputation and to my business…This makes my life unlivable," he said.

RCMP spokesperson Robin Percival said in an email that as "per the Privacy Act, the RCMP cannot release any personal information, nor will we confirm or deny any investigation in which charges have not been laid."

Deliberately incomplete information?

When Xian was ordered to divest his shares in Wealth One in early 2023, the Liberal government was enduring daily fire from critics accusing them of not doing enough to counter Chinese interference. 

It is unknown if the leakers in Xian’s case are the same who have been releasing classified information regarding election meddling.

The political pressure for a public inquiry was driven primarily by leaks to the Globe and Mail and Global News, which alleged that the Chinese government attempted to influence the 2019 and 2021 federal elections.

"CSIS continues to investigate the unauthorised disclosure ("leaks") of classified CSIS information to the media, in parallel and in coordination with other Government organisations as well as the RCMP criminal investigation," wrote CSIS spokesperson Eric Balsam in an email to CTV News. He says the agency is limited in what it’s able to share, due to the ongoing investigation.

"What I can tell you is that CSIS takes any allegations of security breaches, including the unauthorised disclosure of classified information, very seriously," he wrote.

"The compromise of information not only threatens the integrity of our operations, but it also puts the physical safety and security of our human sources and employees at risk," the email continued. "It can also erode the trust of our international partners."

Before he stepped down as special rapporteur last June, David Johnston found that media reporting on foreign interference raised legitimate questions. However, he accused media of misconstruing the intelligence because they did not have the full context.

Dan Stanton, a former CSIS executive manager, says intelligence is open to interpretation. He believes the leaks are partisan in motivation and that the culprits are deliberately "not providing the full picture - but a particular slant."

Although the leaks have led to a public inquiry, Stanton does not consider the leaker a whistleblower.

"Legally, a whistleblower has to determine that a law was broken. You can't just be a whistleblower because you don't like the government," Stanton said. 

National security expert Wesley Wark, who works at the Centre for International Governance Innovation, agrees that there should be consequences for leaking classified information. But Wark isn’t convinced CSIS and the RCMP are doing all they can to find the source.

"I’m sorry if this sounds cynical - but does the government really want to find the leakers? If they find them, what do they do with them?"

Wark says putting the leaker on trial could create a political circus and expose sensitive information the government wants to keep secret.

"It’s always a two-fold question. Can we find the leakers, and do we want to find them?"

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