Finance Minister Orders Founders of Wealth One Bank to Divest Shares
Finance Minister Chrystia Freeland has issued orders to three of the founding investors of Wealth One Bank of Canada, instructing them to divest their shares. Additionally, the bank has been ordered to comply with stringent national-security conditions to protect against the founders’ alleged links to the Chinese government. The three individuals, Shenglin Xian, Morris Chen, and Yuangsheng Ou Yang, were given 180 days to sell their shares in the bank. Wealth One Bank, based in Toronto and established in 2016, serves Chinese-Canadian clients. In April, Ms. Freeland raised concerns about potential Chinese government pressure and money laundering activities within the bank. The recent orders are unprecedented and reflect the heightened tensions surrounding Chinese interference in Canadian affairs.
The requirements imposed by Ms. Freeland are extensive and include severing all ties between Wealth One and the founding investors, implementing strict security measures to prevent money laundering and unauthorized information sharing, and ensuring compliance with national-security standards. The bank is also prohibited from using the Chinese social-media messaging app WeChat for banking activities. Furthermore, Ms. Freeland has ordered the appointment of an independent third-party monitor and the hiring of two compliance officers to oversee security and anti-money laundering efforts.
Wealth One Bank’s president and CEO, Paul Leonard, stated that the bank has worked collaboratively with the government and supports the implementation of these measures. However, it remains unclear whether the founders have divested their shares or if they will contest the orders in court. Lawyers representing the founders have not provided any comments on the matter.
These unprecedented actions highlight the Minister of Finance’s commitment to safeguarding the security and stability of the Canadian financial sector. The use of ministerial power to force the ousting of a bank’s founders and enforce stringent security measures signifies the seriousness of the national-security threat posed by the individuals involved. Former officials with finance and national-security backgrounds have emphasized the extraordinary nature of these measures and the need for such actions based on the circumstances.
It should be noted that Wealth One Bank has faced scrutiny in the past. In March, it was fined $676,500 for non-compliance with anti-money laundering regulations. The recent orders from the Finance Minister aim to rectify these issues and ensure the bank operates with intensified security measures.
The full text of the Minister’s orders and the letters of patent can be accessed [here](https://embed.documentcloud.org/documents/23935026-letters-patent-of-incorporation-of-wealth-one-bank/?embed=1&responsive=1&title=1).
As this story continues to develop, the future implications for Wealth One Bank and its operations remain uncertain.