In a Reuters report published by The Globe and Mail
, officials said that the seizure proceedings initiated at the Supreme Court of British Columbia last week by China CITIC Bank Corp. Ltd. against alleged fugitive Shibiao Yan stem from years-long negotiations between China and Canada to recover the assets of those associated with money laundering, tax evasion, and other economic crimes.
“This is a normal thing to do internationally,” Chinese Foreign Ministry spokesman Hong Lei said in Beijing, adding that the bank is acting in full accordance of the law in protecting its rights.
The bank is seeking to take hold of Yan’s suburban homes in Vancouver worth $7.3 million as repayment for a line of credit worth around $7.5 million (50 million yuan). Court records stated that the transaction was “personally guaranteed” by Yan, who allegedly fled to Canada after getting the loan several years ago.
“The person involved left China with a large debt owed,” according to lawyer Christine Duhaime, who is acting as the bank’s representative in the case.
Yan has yet to file a legal response and make a comment on the issue.
Observers have previously noted that a combination of generous exchange rates and relative stability has made Canadian real estate markets irresistible to Chinese investors, and also to unscrupulous individuals looking to park their illegal wealth in overseas assets.
Earlier this year, the federal government earmarked around half a million dollars in this year’s budget to craft methods of accurately measuring the impact of foreigners on home price growth. Various analysts have pointed at foreign money as a driving force in the unprecedented price increases seen in Vancouver and Toronto.
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A leading Chinese lender’s pursuit of a supposed defaulter via Canadian courts is well within the bounds of existing legal codes, according to national authorities.