Ottawa approved fraudster to offer visas despite whistleblower warnings of immigration and Ponzi scams

By Amy Chen

Canada’s immigration department approved an alleged fraudster to offer immigrant visas despite warnings from whistleblowers that the company was running a Ponzi scheme and committing immigration fraud.

Former employees of Istuary Investment Group claim that they warned the Immigration, Refugees and Citizen Canada (IRCC), then known as Citizenship and Immigration Canada (CIC), in 2016 that CEO Ethan Sun was asking for money from foreign workers hired in Vancouver an opportunity to obtain permanent residency under the BC Provincial Nominee Program (PNP) in exchange for “investments” into Istuary.

“Ethan Sun targeted recent graduates on post-graduate work permits who come from wealthy families,” one former employee said. “Sun boasted about how he was friends with BC Liberal leader Christy Clark. He showed them Christy Clark’s hand-written notes thanking him.”

BC provincial nominations became highly prized after Clark’s government exempted provincial nominees from the foreign property buyer tax^[1]https://news.gov.bc.ca/releases/2017PREM0037-000677.

The employees reported Ethan Sun and Istuary to the department using the citizenship fraud hotline.^[2]http://www.cic.gc.ca/english/information/protection/fraud/report.asp

Despite the warnings, the Minister of Citizenship and Immigration designated Istuary Idea Labs Inc, part of the Istuary Group, as a designated incubator for the startup visa program on August 19, 2017, even while litigation against the company was pending^[3]http://www.gazette.gc.ca/rp-pr/p1/2017/2017-08-19/html/notice-avis-eng.php.

When asked for comment, IRCC claimed that Istuary was recommended to the department by Canadian Acceleration and Business Incubation Association(CABI).

“Upon receiving a designation recommendation, IRCC conducts additional due diligence by reaching out to governmental partners and others who may have knowledge of or contact with the organization,” IRCC spokesperson Nancy Caron said. “In the case of Istuary Innovation Group, IRCC found no reason to reject the designation recommendation at that time.”

However, reviews on employer rating site Glassdoor shows that employees have been raising red flags about Istuary being a Ponzi scheme as far back as 2015.

“Yes, this is indeed a very “innovative” form of fraud! At least in Canada!” one reviewer claims^[4]https://www.glassdoor.ca/Reviews/Employee-Review-Istuary-Innovation-Group-RVW8961376.htm. “They take advantage of well-known political and business organizations to boost their reputation.”

So far, four investors have filed claims alleging that Istuary Investment Group CEO Yi An “Ethan” Sun and his wife Yulan “Amy” Hu have defrauded them of $4.2 million, most of which was allegedly used by Sun and Hu for speculating in real estate in the lower mainland^[5]https://drive.google.com/file/d/0B-G2xjXkuEpCM0RLY3MwMVJBMHM/view?usp=sharing^[6]https://drive.google.com/file/d/0B-G2xjXkuEpCaktBbk9fZDdiUE0/view.

All of the investors allege that Ethan Sun promised to return them five times the principal within two years.

Current employees of Istuary Innovation Group are complaining that they have not been paid since May ^[7]https://www.linkedin.com/feed/update/urn:li:activity:6317362533829353472/, and the ones we talked to allege that CEO Ethan Sun and CFO Brian Chen ^[8]https://www.linkedin.com/in/brian-chen-mba-cpa-cma-cpa-illinois-626b034/ have fled the country.

When reached by email, BC PNP sent us an automated response informing us know that “due to heavy volume” it might be 10 days before we receive an answer.

We have also reached out to CABI’s executive director Kailin Che^[9]https://www.linkedin.com/in/kailinche/, but have so far not received a response.