How China Courted, Cultivated, and Cornered Ottawa
“Canada is back!” declared the country’s new leader, and so was the Liberal Party. Justin Trudeau was elected prime minister in 2015, and his declaration of Canada’s return might as well have been spoken directly to Beijing. He had campaigned on improving relations with China, making it a “top priority,” according to the Prime Minister’s Office. The next year, he made an official visit to the People’s Republic of China and began exploratory talks on a free trade deal, and—in a move that must have left Canada’s pro-democracy activists in shock—even considered an extradition treaty.
I had already heard that, historically, Ottawa took a juvenile view of intelligence. I was told lawmakers liked receiving it but not acting on it. Instead of using the insights provided by intelligence reports to help direct policy decisions, they created conditions for a uniquely Canadian iteration of plausible deniability. Instead of the government being able to deny involvement in an important decision, the Canadian version of the concept relied on denying they even knew what was happening. Adhering to a culture like this could be disastrous in the Xi Jinping era, when the new president of the PRC is seeking to make China a hegemonic power in the world and has ramped up the country’s “united front” efforts, along with espionage and cyber intrusions. (The United Front Work Department, or UFWD, is the Chinese Communist Party’s main body for engaging in overseas influence.)
By the time Trudeau’s Liberals had assumed power, veteran members of Canada’s political class were concerned about the PRC’s level of influence in the country. David Mulroney, Canada’s former ambassador to China, recalled to me how, in his dealings with Chinese diplomats during his tenure, he faced a growing arrogance.
“There was a certain pragmatism,” he said, that existed when he’d dealt with China in the past. But by the turn of the century, everything had become “zero sum.” He told me, “You begin to get this sense of a China that was infallible.” This attitude became exacerbated with President Xi and his consolidation of power. Mulroney noticed a tendency of business leaders to be “overwhelmed” by PRC officials, in that they seemed easily taken in and in awe of them. At Chinese New Year events in Canada, Mulroney witnessed how politicians at multiple levels “would be kissing the ring” of the Chinese official at the event and ceding political space and clout, which struck Mulroney as odd, given they were in Canada.
Other former diplomats I spoke to highlighted how their biggest concerns were not so much the actions of politicians while in office but their actions upon leaving: the acceptance of plum jobs in China, sometimes direct offers of assistance to the PRC government. Others told me how they’d witnessed, during sensitive government discussions, that the PRC was able to pick off members of Canada’s negotiating teams and influence them against Canada’s own interests.
Once elected, Trudeau immediately went to work detailing how he was going to deal with China differently than Stephen Harper had. At the 2015 G20 meeting in Turkey, Xi remarked that China would never forget how former prime minister Pierre Elliott Trudeau had welcomed the PRC with official recognition in 1970. In 2016, the PRC and Canada celebrated forty-five years of official recognition at a gala event, one at which the PRC ambassador, Luo Zhaohui, remarked that Justin Trudeau “carries forward his father’s legacy.” Apparently, the Canada–China relationship was coming full circle.
Trudeau’s trip to the PRC was celebrated in Chinese media with references to him as the “little potato,” as the name “Trudeau” sounds much like the Mandarin word for potato. It was a term of endearment, if not exactly a compliment. Trudeau told Premier Li Qiang how pleased and “very happy” he was to be following in his father’s path with China. Exploratory talks on free trade were set to begin, although the extradition treaty China wanted was not on the agenda. A 2014 document from the Canada Border Services Agency claimed the PRC wanted such a treaty so it could immediately apprehend Operation Fox Hunt targets with little fuss—a program to capture what China calls “economic fugitives” who have fled the country. CBSA officials appeared willing to come up with an agreement that could allow people to be sent to China in the absence of an official treaty, what one official called a “blank removal cheque.”
Trudeau was keen to figure something out. CBSA documents from the time considered the PRC one of the main sources of “irregular migration” to Canada, with substantial fraud taking place in visa applications. A portion of this fraud could likely be attributed to organized crime working with the PRC mission. Even in the absence of an extradition treaty, Canada was willing to permit Chinese police to testify at immigration hearings in Canada, and in 2016, Canada actually allowed PRC Ministry of Public Safety, or MPS, officers to meet with PRC targets to negotiate a “voluntary return.” Despite these concessions, PRC officials also met with targets without supervision and against agreed-upon protocols, pressuring them to return.
According to Global Affairs Canada documents obtained through an access-to-information request, the sky was the limit as Canada filled its cart with items from Beijing’s shopping list. On bilateral relations, Canada wanted annual meetings with PRC leaders, with 2016 slotted for free trade discussions. The Canadian government wanted to expand collaboration on green mining technologies and the development of eco-cities; it was seeking memorandums of understanding between the Canadian Institute of Health Research and the National Natural Science Foundation of China; and it wanted to expand cultural partnerships in the film industry and sports.
Apparently disregarding what Canada already knew about Confucius Institutes—a series of international schools, including eight in Canada, where what was actually being taught was the CCP’s version of China—the government also wanted to “liaise with provinces and municipalities with respect to enhancing Chinese language and Asian history curricula in Canadian schools.” Global Affairs Canada even sought to “normalize Asia-related content in Government of Canada training”—whatever that meant—as a “long-term initiative.” Then there was the memorandum Global Affairs sought between the Royal Canadian Mounted Police and China’s MPS, the details of which have yet to be revealed, though I anticipate it’s something to do with Fox Hunt.
There’s more. Canada wanted to examine the potential for the Department of Defence to allow members of China’s People’s Liberation Army to participate in Canadian “winter training” and “in each other’s military courses.” Global Affairs’ wish list even included a memorandum of understanding between the Supreme Court of Canada and the Supreme People’s Court of China, the subject of which remains unknown. A liberal democratic country like Canada was seeking a memorandum of understanding with the legal system of an authoritarian regime—the same regime that had engaged in hostage diplomacy against Canadians (and soon would again) and wanted to displace the United States as the world’s superpower.
And then came dinner.
In November 2016, the Globe and Mail reported that Trudeau had partaken in a Toronto fundraising dinner in May with a group of Chinese billionaires, what the press was calling a “cash for access” event. At $1,525 per person, attendees included a “political adviser” to the PRC government, a man named Zhang Bin, who, along with another wealthy partner, Niu Gensheng, donated a million dollars to the Pierre Elliott Trudeau Foundation in Montreal, a funding program for doctoral students, to honour the “memory and leadership” of former prime minister Pierre Trudeau. The gift would be divided as follows: $200,000 to the foundation and $50,000 to build a statue of the late prime minister, with $750,000 to fund faculty of law scholarships at the University of Montreal. Bin was also named in the story as president of the China Cultural Industry Association.
Among the other attendees was real estate developer Ted Jiancheng Zhou; Jenny Qi, an investor and president of the Canada Confederation of Shenzhen Associations; and a wealthy businessman named Edward Gong. The dinner was hosted by Benson Wong of the China Business Chamber of Commerce. One of the people behind the event was a man named Richard Zhou, who was an organizer of such funding events for the federal Liberal Party. Another attendee was Shenglin Xian, the founder of Wealth One Bank, a Canadian financial institution that catered to Chinese clients.
Xian’s attendance stirred controversy, as shortly after the dinner, the Globe reported that Wealth One Bank’s application for Schedule I status had been granted, giving it the same status as any other domestic bank in its ability to accept deposits in Canada. The Globe reported that a key investor in Wealth One was a grocery business owner named Yuansheng Ou Yang. The bio for Ou Yang on the bank’s website claimed he had served as a member of China’s National People’s Congress and was part of a policy conference that plays a role in the PRC’s united-front strategy. Representatives of the bank told the newspaper that the bio must have been a mistake, an attempt by Ou Yang to sound more impressive. Meanwhile, Xian stated to the Globe that he never discussed Wealth One Bank with Trudeau.
Trudeau defended the dinner. No ethics breaches were found, and the party claimed the fundraising complied with Elections Canada rules. Nonetheless, news of the dinner likely unsettled researchers in other Five Eyes countries and experienced China watchers. Creating opportunities for people connected to the PRC government to rub shoulders with politicians from nations China was looking to influence was a hallmark of PRC united-front interference and influence operations.
As experienced China researchers Anne-Marie Brady and Clive Hamilton have shown, community groups in service of the UFWD and united-front policies writ large are also instrumental in waging interference on the political level. This interference often begins with seeking to influence important individuals in a targeted country over time before having them engage in interference on China’s behalf. Some degree of influence peddling is acceptable in free societies, when it is overt and transparent. But united-front work very often has a far more nefarious goal, and it is covert for that reason.
Some democratic states have sought to expose UFWD tactics. While introducing legislative changes, such as foreign interference laws, to counter this activity, former Australian prime minister Malcolm Turnbull, for instance, identified this “covert, coercive, or corrupting” behaviour as “the line that separates legitimate influence from unacceptable interference.” It’s a simple distinction. The PRC would attempt to influence individuals and promote their mission abroad, much like any other country, but when China’s influence becomes secret and sustained over time, with incentives such as gifts or blackmail, the PRC could then leverage an individual to engage in interference on their behalf. That interference is a violation of the target country’s sovereignty, and the word that best describes this interference activity is hostile.
The government pressed on with its desire to improve Canada–China relations until December 1, 2018, when even the appearance of goodwill came to a crashing halt. At the request of US authori-ties, the RCMP arrested Huawei chief financial officer Meng Wanzhou, daughter of Huawei founder Ren Zhengfei, while she was transferring flights at the Vancouver International Airport. On January 28, 2019, the US announced fraud charges and revealed that its request to arrest Meng was in response to accusations that Huawei had attempted to sell equipment to Iran and skirt American sanctions, an arrangement Meng was accused of covering up.
In essence, the case was concerned with whether she misled HSBC about the relationship Huawei had with the Iranian subsidiary, Skycom, which could have put the bank at risk of violating sanctions. She denied the charges and said there was “no evidence” she had deceived HSBC. For a state that often claimed it did not control companies like Huawei, the PRC was furious and demanded her release. On December 10, nine days after Meng’s arrest, Canadians Michael Spavor and Michael Kovrig were arrested in China. While the PRC denied the arrests were in retaliation, the connection between Meng’s arrest and theirs was patently obvious. Once again, as with Canadian couple Kevin and Julia Garratt’s detention in 2014, Canada was facing hostage diplomacy at the hands of the PRC.
Enter members of the former Jean Chrétien government, including the thrice-elected prime minister himself. Chrétien had offered to serve as a type of envoy for the government to negotiate a release, while other members of his former government suggested that the Canadian government should have tipped off Meng so she could flee arrest by Canadian law enforcement. Media reports of the detention of the two Michaels sounded eerily similar to details of the Garratts’ detention. That is, they were under constant interrogation and surveillance, with lights on at all times. Events took another strange turn when Canada’s ambassador to the PRC, John McCallum, shared his thoughts with a news reporter.
McCallum held a press conference about the arrest in Markham, Ontario, for Chinese media and told reporters that the PRC and Meng had a good chance at fighting her extradition. McCallum would end up being fired by the government and losing his ambassador post as a result. Following this conference, Canadian media highlighted that McCallum had received $73,000 in free trips to China.
McCallum’s replacement as ambassador was Dominic Barton. Barton was the global managing director of the consulting firm McKinsey & Company, where he had worked for thirty-two years. McKinsey’s marketing materials had stated, on a now-deleted web page, that it had been an adviser for the Chinese government: “McKinsey’s impact in China goes well beyond our work in the corporate sector. . . . [I]n the past decade alone, we’ve served over 20 different central, provincial and municipal government agencies on a wide range of economic planning, urban redevelopment and social sector issues.” At a glance, this connection might not seem like reason for concern, but some US lawmakers felt otherwise.
McKinsey has faced calls from some US lawmakers to be barred from any contract work for the US federal government because of its inconsistent statements on its business with China. McKinsey’s global managing partner stated in a congressional hearing that “we do not work, and to the best of my knowledge never have, for the Chinese Communist Party or for the central government in China.” He claimed the defunct website was not part of McKinsey.com and contained an “inaccurate representation of our client service.” The site was online from 2014 to 2019. Chinese state media claims the firm was commissioned as far back as 2007 to advise on health care reform. The calls to bar the company from more US consulting work stemmed from concerns that McKinsey, given its US contracts, would have knowledge of US military planning. If it was also working for China, information could leak from one country to the other.
During Trudeau’s time in office, Canadian government contracts with McKinsey ballooned. During the Harper years, they totalled $2.2 million, but from 2015 through 2024, McKinsey contracts swelled to a total value of $116.8 million. On appointing former McKinsey global managing director Barton as ambassador, Trudeau claimed it was Barton’s years of experience in Asia that would “make him a great choice to represent Canada—and Canada’s interests—in China.”
By 2021, Meng was running out of legal options to avoid extradition. At the same time, a closed hearing was held in China for Kovrig, and what then foreign affairs minister Marc Garneau called a “mock sham trial” was held for Spavor. This came after China had tried to pressure Canada’s position on Meng with trade sanctions. The two Canadians were finally released on September 24, 2021, hours after Meng made an agreement with US prosecutors to avoid fraud charges.
As part of the agreement, Meng pleaded not guilty to the charges but entered into a deferred prosecution agreement that required her to admit to a series of facts in the agreement, including that she “misrepresented Huawei’s relationship with Skycom to HSBC.” The US dismissed the charges against her on December 1, 2022. The entire time, Beijing had tried to claim there was no link between Meng’s arrest and those of the two Michaels. As Munk School China specialist Lynette Ong phrased it on CBC Radio, the connection was “totally undeniable.”
Years ago, a leaked draft of a joint RCMP and Canadian Security Intelligence Service report from the 1990s called Project Sidewinder made claims of links between the PRC state and organized criminal networks. The report ended up taking a drubbing in the media for its lack of analytical rigour. But in hindsight, how far-fetched were its conclusions?
The Hogue Inquiry into foreign interference, established in 2023, revealed that the RCMP suspected that PRC-organized crime in Canada does have links to foreign interference. In fact, the inquiry heard about how money laundering networks were being used in support of foreign interference activity. That should hardly be shocking. In 2023, India was accused of hiring assassins in the US and Canada. The Russian state has widely been known to employ the services of organized crime. That the PRC would also make use of criminal networks just makes sense.
A ProPublica investigation detailed the arrests of Chinese organized crime bosses in Italy. Investigators said the bosses who were arrested do “what the consulate doesn’t do, or [do] it better.” They have “the network, power, resources.” They “know the diaspora,” and the bosses are “feared and respected.” Individuals involved in money laundering in Europe were also behind secret Chinese police stations there, ProPublica reported, and “gangsters help monitor and intimidate immigrant communities for the regime in Beijing, sometimes as leaders of cultural associations that are key players in China’s political influence operations and long-distance repression.”
Emmanuel Jourda, a scholar on Chinese organized crime at France’s Centre for Studies on Modern and Contemporary China, stated that the CCP “takes the most powerful, richest, most successful figures overseas and recognizes them as the nobility of the diaspora. And it doesn’t matter how they made their money. The deal, spoken or not, is: ‘You gather intelligence on the community, we let you do business. Whether legal or illegal.’” In exchange, the CCP protects the gangsters.
US authorities have discovered similar trends where crime and espionage mix. US authorities tracked individuals who fed the PRC intelligence in exchange for being allowed to continue engaging in criminality. For these individuals, one former US national security official said, their “currency was influence.” The PRC selected criminals to work with based on their influence ability.
Drawing on this research, we can boil down why a state would use organized criminal elements to do their dirty work to three factors: it allows the foreign state a level of plausible deniability, giving them a degree of separation from the activity; the crime bosses know the local area better than the foreign state does; and the local criminal gangs just do some things better.
Despite what the Hogue foreign interference inquiry found and what Canada’s allies are saying, and although the government publicly named India as a nation that used crime groups to engage in criminal and interference activity in Canada, the Canadian government hasn’t said anything about China.
Excerpted from Under Assault: Interference and Espionage in China’s Secret War Against Canada by Dennis Molinaro. Copyright © 2025. Published by Random House Canada, a division of Penguin Random House Canada Limited. Reproduced by arrangement with the Publisher. All rights reserved.
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