CBI, Telegram and Corruption in Canada
As an immigration lawyer, I regularly get offers from shady agents and unscrupulous consultants. “We are an agency based in Dubai with connections with millionaires and BILLIONAIRES. We propose a partnership with your esteemed firm and we will give you access to our wealthy clientele.” (For some reason, these agents love caps.) I was reminded of these scams when I read that arrested Telegram CEO Durov is a citizen of no less than four (4) jurisdictions: France, Russia, UAE and Saint Kitts and Nevis. I had to wonder if he was a client of one of those shady agents.
Saint Kitts and Nevis stood out. I gave a presentation at a conference in Las Vegas and one of the panellists was trying to sell the CBI (Citizenship By Investment) program in Saint Kitts and Nevis. For billionaires, I imagine the $250k “donation” to their government in exchange for citizenship must be quite cheap.
I have to wonder if Mr Durov may be one of those billionaires who likes to collect passports. The Saint Kitts and Nevis CBI program is completely transparent and well-advertised. They have nothing to hide. (You can look up the details on your own. I’m not going to drive any more traffic to their shady websites.) CBI programs in other countries, however, can be quite secretive and heavily in the “pay to play” model. The corruption is below the surface. In Vegas, I remember a conversation with a wealthy gentleman from Vietnam who had a goal of 7 passports.
The French Connection
On the French side, it seems Mr Durov obtained French citizenship in 2021 through a special procedure and, possibly, “special” connections. French President Macron has defended the decision to “fast-track” Mr Durov’s citizenship application. According to The Associated Press, Durov “sought French citizenship via a request to the French Foreign Ministry”. Other reporting provides additional details on how the Russian-born billionaire used his influence at the highest levels of the French government:
According to Le Monde’s report, Durov became a French citizen through a special procedure under which “a French-speaking foreigner who contributes through his or her outstanding work to the influence of France and the prosperity of its international economic relations” can be awarded citizenship at the government’s initiative.
What led Durov to obtain this status was not made public, and his French linguistic skills are unknown.
A spokesperson for the French presidency told POLITICO that the call to grant Durov citizenship had been made by the foreign affairs ministry. The foreign affairs ministry said it “does not communicate on individual citizenship procedures.”
My guess is that after the recent arrest of Mr Durov on French soil, there will be more questions on how he obtained his French passport. In my mind, it seems clear Mr Durov used his power and influence at the highest levels of the French government for his personal gain. That smacks of corruption.
Canada does not have a CBI program; however, we have had programs at both the federal level and at the provincial level with corruption scandals. From 1986 to 2014, Canada had the Immigrant Investor Program (IIP) which was fraught with issues and denounced as a way for wealthy foreign nationals to purchase Canadian citizenship. On the provincial side, the PEI PNP program was mired in scandal and abuse. Recently, Spoke Media made an amazing video that outlines many of the issues of potential corruption from PEI.
At the conference in Vegas, while my panellists were selling CBI programs, I used my time to review the MPNP BIS program – currently, one of the only programs focused on wealthy investors. This program, however, has very strict requirements and takes significant effort on the part of the applicant. Mr Durov, for example, would not have a hope of getting a Canadian passport through MPNP BIS. (The fact that MPNP BIS applicants must spend the majority of their time in Manitoba while the application is in process is often a deal breaker.) Nonetheless, our panel was extremely popular at the conference – standing room only.
Government corruption vs Private corruption
Transparency International (I love their work) defines “corruption” as “the abuse of entrusted power for private gain.” It is not, therefore, limited to government actors or officers. In Canada, our immigration system seems to have rampant corruption on the private side – and it is getting worse.
“On the black market, LMIAs used to cost somewhere between $10,000 to $15,000,” Sierah said. “Now, these workers are paying $70,000 to $80,000 to consultants and employers for LMIAs — and when they come to Canada they realize the job doesn’t exist.”
Let me explain what has been happening on the black market on the private side. A foreign national (FN) pays $$$ to a shady immigration consultant who has connections with a shady business in Canada. That consultant helps the business with the requisite advertising and recruiting, files a Labour Market Impact Assessment (LMIA) on behalf of the business. Once approved, the LMIA gives the business permission to hire the FN. The FN applies for a Closed Work Permit (CWP) and comes to Canada as a worker. Sometimes, the FN will pay the Canadian business $$$ which they can get back (in part) in the form of “income” which will help them apply for PR status. The Canadian business (eg. Tim Hortons, Subway, etc) runs as normal, adding the FN to payroll and providing documents to show Canadian work experience (even if the FN never actually shows up). In the alternative, the FN may be issued the CWP upon entry, not even go to the business and just apply for an Open Work Permit from inside Canada.
These schemes are not new. I have heard of these schemes for many years. I remember back in 2014, CIC (now IRCC) conducted a “comprehensive overhaul” of the system, taking the LMO (now LMIA) away from the immigration officers and handing the reins over to Service Canada (ESDC) Officers. It took a while for the shady agents to adapt. (BTW – if you followed the link above, you can see that in 2014, Canada allowed ~83k TFWs were allowed to enter Canada. In 2023, that number exploded to ~240k TFWs. That increase is crazy!)
Over the years, I have met with many victims who have paid $30k, $35k or $40k to a shady agent as part of the above scheme. From I have heard, that seemed to be the going rate. To date, I have never met a victim who has paid $70k to $80k for an LMIA/ CWP. I also consulted with a colleague and she has had the same experience. I suppose they will be coming…
From my perspective, IRCC & CBSA & ESDC are not doing nearly enough to curtail the rampant corruption among shady agents and immigration consultants. Recently, Mark Holthe went on a rant on this topic and suggested that any Canadian employer who is caught participating in this scheme be severely punished. Indeed. Typically, the owners of these businesses are immigrants themselves and one of the purposes of their business is to help bring family members, neighbours or members of their community. The financial incentive ($80k!) is clearly very strong and, therefore, punishment must be commensurate.
Who is the Victim?
The recent UN’s report on the Canadian TFW program pulls no punches. Nor should it. The system is in dire need of change. These schemes are both sophisticated and well-baked into certain communities. The workers who are seen as the victims often do not want to take any action against their agents. Agents wield significant power with their communities, often operating outside the jurisdiction of Canadian authorities.
I remember meeting a Chinese actuary (!) who was working at Tim Hortons in one of these schemes. She paid $40k for the LMIA/ CWP and she knew that she had to wait to get the Canadian “work experience”. But she was bored. As the Chinese agent promised, she was on track to get PR status, but she wanted a Study Permit so she could take high-level math courses while she was “working”. We had a conversation about the scheme and she was fine with it. (Actually, I think she was annoyed that I was asking her about it.) I reviewed the procedures to get a Study Permit application (yes, temporary residents can have both a Work Permit and a Study Permit at the same time, depending on their circumstances). Was she a victim?
Another gentleman came to my office and wanted my help with a Vulnerable Worker’s Open Work Permit (OWP). He paid $30k for an LMIA Closed Work Permit to work as an agricultural worker in BC but he decided not to go. Instead, he was told by his agent to just fly to Canada and apply for the OWP. “Based on what?”, I asked. “I don’t know. Isn’t that your job?” Ahem. No, it isn’t. Was he a victim?
I do not have a good solution. As I have said many times, here are my suggestions:
- Publish the names of shady agents online, after a proper investigation. To quote SCOTUS Justice Brandeis, “sunlight is the best disinfectant”;
- Stronger punishments for Canadian businesses who are caught;
- More resources for IRCC Officers to vet & screen these applications;
- Adopt a collaborative approach with immigration lawyers (seriously, many of us just want to help!).
Currently, the government publishes the names of employers who were found non-compliant with the TFW program. Yet, for some reason, the government does not do enough to investigate the shady agents and consultants. Many of these agents have been the target of CBSA investigations and they are regularly reported in the news. Often it is the consultants who are behind the scheme. Many shady agents are operating in other countries, out the reach of Canadian investigators. For those agents and consultants who have violated our laws, there seems to be little to no punishment.
I also want to be clear that I am not advocating for making representatives responsible for their client’s actions. Obviously. If the agent was simply trying to help the client navigate the Canadian immigration system, not knowing the nefarious intentions, they are likely not in violation. From my point of view, the agents who are facilitating these schemes, akin to the Government of Saint Kitts and Nevis, are out in the open and quite easy to find. Unsophisticated FNs have to be able to find them, after all.
I am also acutely aware that corrupt practices are common in many countries. It is just part of daily life. For applicants applying to enter Canada, they need to understand, at the onset, those corrupt practices are not acceptable within our shores.
Parting Thoughts
Stamping out corruption is difficult. Very difficult. To this point, I will share a story from many years ago. In 2002, I had the privilege of working at the Canadian Embassy in Washington DC. One of my projects was to organize an anti-corruption conference for the OAS in Miami. The 34 member states of the OAS wanted to improve their image and show they were against corruption. So I went to various meetings to set the agenda, find speakers and, of course, to secure funding. I remember meeting with a representative from Colombia. We gave our pitch for the anti-corruption conference. His reply was something like this: “I like this idea. My brother would be very interested. OK. Tell you what. You put my brother in charge and we’ll pay for the whole thing. You can give him the title of Vice Chair or something.“ Yeah. That happened.
Start the discussion!