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Scott McGregor: Inside CCP Hybrid Warfare Operations in Canada, From Election Interference to Money Laundering

“Canada is at war with China, certainly. Canada just doesn’t realize it,” says Scott McGregor, a former Canadian military intelligence officer.

McGregor is co-author of the new book “The Mosaic Effect: How the Chinese Communist Party Started a Hybrid War in America’s Backyard.”

We discuss the full extent of Chinese communist infiltration into Canada—from large-scale money laundering operations to fentanyl production to recent reports of election interference—and how this impacts the United States.


Jan Jekielek:
Scott McGregor, such a pleasure to have you on American Thought Leaders.

Scott McGregor:
Thank you for having me. I’m looking forward to the interview.

Mr. Jekielek:
Scott, first of all, welcome from Vancouver, Canada. We’ve been hearing a lot here in the U.S. about election interference in Canada and Chinese Communist Party involvement. What’s going on over there?

Mr. McGregor:
The public has now seen that the Chinese United Front is influencing a lot of what’s happening politically. Our intelligence agency, CSIS, the Canadian Security Intelligence Service, has released some documents. They’ve been leaked to a reporter. Some of the politicians in writings in [inaudible] and in Montreal received donations from United Front-related entities with the money stemming back to China and the diaspora that they are attempting to control.

This has been going on for quite some time. The intelligence services and some law enforcement and certain individuals have been trying to raise awareness around the issues with the United Front Work Department. What the intelligence agency is saying is that they’ve briefed the Prime Minister’s office on the information that is in these documents and that there were recommendations made not to have one of the politicians be backed.

Han Dong is the name of the individual, and it’s really starting to cause concern that people knew about this. The intelligence service knew about this. In fact, one politician went so far as to say we should actually have an inquiry into the intelligence agency. People are calling for a public inquiry into what happened.

The Prime Minister right now is diverting attention and saying that he’ll investigate and he will use his appointed intelligence associations and what was supposed to be like an oversight committee, but they’re appointed by the Prime Minister, to look into it. It’s basically the Prime Minister saying he’ll investigate himself, and people are not happy with that and not satisfied.

Mr. Jekielek:
You’re telling me that this is something that we’ve been aware of for some time, but somehow we’ve lost focus. Please tell me about that. This is something you actually know quite a bit about.

Mr. McGregor:
With the elements of hybrid warfare, one of the big ones is sharp power, which is political influence and leveraging, and propaganda. That’s where we see the United Front Work Department.

Mr. Jekielek:
Just very briefly, Scott, if you could just jump in and remind people what the United Front Work Department is of the Chinese Communist Party.

Mr. McGregor:
The United Front Work Department is called the magic weapon. This was how Xi Jinping titled it. It’s basically an element that is designed to do two things, intelligence and propaganda. They go out into the world and the community, and to be honest, Vancouver is ground zero in Canada, and likely in North America.

It’s there to collect information and bring it back to the CCP about what opportunities there are, technologies, and a lot of the espionage pieces. That correlates to the spy agencies within China and also the People’s Liberation Army [PLA] and others that use this information. The propaganda piece is trying to influence and leverage whatever they can, whether it’s corporately or politically in favor of the objectives of Beijing. This is a large organization.

In Vancouver, we see two components, a Cantonese-speaking component and a Mandarin-speaking component. At one time they were vying for information and leveraging and to do good for XI. Then, Xi stepped in and said, “No, you’re going to work together.” And that has happened recently.

This stuff was done overtly, and now we’re seeing a lot more done covertly. A lot of coverup is happening and this is being revealed now through this CSIS leak that information was available. Not many people knew about it, and nothing was being done. That was where the leverage took place, where you’re able to leverage the politicians, cover things up, and stop the awareness from gaining strength in Canada, but also in the United States.

Mr. Jekielek:
You also mentioned that this political influence is one component of hybrid warfare, and you also mentioned unrestricted warfare. Which is a book that was written back in 1999 by two Chinese colonels explaining that every field of interest is warfare from the perspective of the PLA, and it became a doctrine. But with hybrid warfare, what’s that relation? What does that mean exactly?

Mr. McGregor:
Hybrid warfare is almost synonymous with unrestricted warfare. They’re basically the same concept. It became a military term. When I started working with the RCMP, it was something that I visited and started to bring to prominence to see the connectivity between the different elements within hybrid warfare; sharp power, which is the political piece, and soft power, which is the economic subversion of corporate and industrial critical infrastructure.

And then, there is transnational organized crime which includes threat finance, money laundering, and narcotics trafficking, all of that type of stuff and how they interact. This is the funding of different operations that are run by the United Front and also other Chinese organizations within the target country.

Mr. Jekielek:
In your book, The Mosaic Effect, this is what you call the unholy trinity.

Mr. McGregor:
Yes. The unholy trinity is really the connectivity between the Chinese nation state sponsored activity, the business piece and tycoons that are buying up different industries and businesses, and the organized crime figures like the triads out of Hong Kong.

Mr. Jekielek:
You also mentioned the RCMP. Some of our non-Canadian viewers might not be familiar with them. In Canada we have CSIS, which is the intelligence agency, and then we have the RCMP, which is the enforcement agency.

Mr. McGregor:
The Royal Canadian Mounted Police are an agency that does municipal, regional, and federal policing. The main component to consider here is the federal piece. They’re a lot like the FBI in that sense, and they have all the powers that the FBI would have.

Mr. Jekielek:
But the intelligence piece that the FBI has been doing would be with CSIS, not with RCMP. They have to work together.

Mr. McGregor:
Correct. CSIS is a domestic intelligence agency and they look inwardly. They’re not an international spy agency like the CIA.

Mr. Jekielek:
What is the mosaic effect?

Mr. McGregor:
The mosaic effect is an intelligence technique and it’s basically looking at disparate pieces of information. You may not know what it means at the time, but as you’re collecting this information and you gather more and more, it starts to create a picture for you. That’s basically how we identify, in military intelligence, what’s going on in the battlefield. We can see a structure of what elements are out there and what they do and who they belong to.

In law enforcement, it would be different entities that were conducting drug deals, and where are they getting the drugs from? Suddenly, that starts to create a picture on how these elements are working together or have the same supplier facilitators. We can see definitively how these things are connected, and that picture is getting stronger and larger by the day.

Mr. Jekielek:
We’re going to talk about all this. Before we go there, you’ve been an intelligence guy for decades. Please give us a picture of your career span up until today.

Mr. McGregor:
Certainly. I first joined the military in 1989. I’ve served in the Army, the Navy, and the Air Force. My last position was in intelligence where you have to be selected to get into the intelligence in Canada. It’s not something you can just sign for.

I worked in military intelligence for 15 years and my career saw me in Afghanistan doing a lot of different work with counter-terrorism and that type of thing. I was a defense attache to the King of Bahrain through the Central Command’s Navy Headquarters, which is located right in the gulf there. That is really where I started to work with American agencies quite a bit.

We were asked to help develop a pilot project to prove transnational narco-terrorism. Transnational narco-terrorism at the time was not believed to actually occur, mainly because terrorists were receiving so much attention following 9/11 that no one thought these large criminal organizations would want to work with them. That makes sense because no one wants to have the heat on them when they’re trying to do these things.

But again, this was about the people that control the routes for smuggling and narcotics. Hezbollah had come out and said, “We’re going to conduct hybrid warfare. We are going to fundraise. We are going to use everything possible to make money because we have sanctions against us.” We were able to identify a vessel that had terrorists and narcotics on it. That began this new project that I believe the DEA headed up.

I left the military and moved to the RCMP, where I came in and was identified as an intelligence person, but I was under operations and not intelligence. They asked me to take a look at a few things. One of the big ones was a pilot project looking at conversions between transnational organized crime and national security.

One thing for the viewers to understand is that the Five Eyes, which is Australia, Great Britain, the United Kingdom, New Zealand, Canada, and the United States, have an intelligence agreement to share information. All of the Five Eyes have a strategy on transnational organized crime, identifying it as a threat to national security, all but Canada.

What that does is it allows the different elements within a country, like within the United States, military and law enforcement are able to share information that isn’t just law enforcement sensitive, it’s national security sensitive, and it’s classified information. We don’t have that in Canada. The ability to share that information is very limited and it’s not widespread. It’s not commonly understood even by some of the top people within law enforcement.

There was an issue there. What I was able to do was take a look at the files in the lower mainland, which is the majority of RCMP files in the entire country. We identified a lot of different elements, entities within the Chinese, Iranian, and cartels that were working together. This started to gain traction.

What I was working towards was bringing in some intelligence colleagues of mine within my network into the headquarters in Vancouver and start to understand more about the threat emanating from north of the border. The Americans were blown away by the level of corruption, criminal activity, and connectivity. A lot of this information was briefed to the intelligence community within the United States.

All of the agencies were made aware, and I believe some of this information was briefed in the Pentagon. The people that I was working with here in DC actually came to Canada to talk to the agencies in Ottawa at the national level.

That was quite the movement. We began doing some think tanks in classified areas to start to discuss what was going on and how it connected to the different parts of the Five Eyes. Australia was impacted. New Zealand we see is heavily impacted. The United Kingdom still has issues with what’s going on with the Chinese.

The other piece was how what’s happening in Canada is impacting the United States, and how this heavy presence in Canada is a threat to the United States. Those things really started to come home.

Unfortunately, this was cut short. I ended up leaving the RCMP and moving to the provincial government where I worked for the attorney general. I created an intelligence unit with my boss at the time who was overseeing it, and it was a small unit. And yes, we were looking at the gaming policy enforcement branch and gambling integrity.

The reason that’s significant is one of the big ways to identify bad guys operating in the area was what we call the soft underbelly. People like to mingle, especially in the spy world and the criminal world. One of the ways they do that is through casinos. They develop networking and relationship building, and that occurs in these locations.

The other aspect of the gambling is things like black safari, where you’re able to acquire things that are illegal. Black bear paws in a restaurant for instance, they sell for $500 a paw. We had a huge piece on the conservation side where black bears were being wiped out within the province.

There are a lot of things that are overlaid: prostitution, narcotics, and whatever gamblers wanted. Probably dominant was the Chinese diaspora, with a lot of overseas Chinese coming in. Whale gamblers are what they were calling them, and they were mingling with criminals and receiving money. This became an actual project with the RCMP, the largest money laundering case in Canadian history called E-Pirate. It took three years and a lot of effort, but the charges were stayed.

It was followed up by another project called E-Nationalize, and E-Nationalize was very similar. It was also looking at the gambling and the connections between different Chinese entities and the money; how it got there, where it went, and what it was funding. That information led to connections between the United Front Work Department and these criminal organizations.

This goes back to the hybrid warfare model where you’re fundraising and you’re using organized crime to get that money and fund different propaganda operations, from being able to give bribes, to lots of different ways to use that money.

I ran into some trouble trying to raise awareness within the government. At the time we had a liberal government. I was under the Ministry of Finance, and there was no interest, because there was about $1.3 billion a year coming into the government from drug sales such as Fentanyl. Fentanyl is one of the major concerns within the community. We were losing a thousand people a year to Fentanyl overdoses. And that really struck home.

Mr. Jekielek:
I’m going to jump in for a second.

Mr. McGregor:

Mr. Jekielek:
You mentioned that $1.3 billion worth of fentanyl sales, the money from that was coming to the government?

Mr. McGregor:
The fentanyl sales didn’t total $1.3 billion dollars. The money coming into the casinos was about $1.3 billion dollars in revenue. The portion that came from narcotic sales is unknown.

Mr. Jekielek:
You haven’t mentioned that the casinos are a major money laundering pathway, correct?

Mr. McGregor:
Correct. And the money is not necessarily laundered in the casino. The casino is a facilitator of the process. That’s something that was identified and called the Vancouver Model. The Vancouver Model is basically money coming from China, but it’s not really coming from China. It’s moved from one entity, one whale gambler, into a criminal’s account who is a resident in Vancouver.

When the whale gambler arrives in Vancouver, he is delivered drug money. This was in Canadian media, and actually in American media as well, because I was actually briefing around the country in the national gaming intelligence sharing group, which was looking at what’s going on with regards to money laundering and illegal activity.

That money was shifted to the gambler when he arrived at the casino in hockey bags; $750,000 in $20 bills wrapped in elastic bands was delivered to a gambler at the casino. This was a regular occurrence. They were bringing in suitcases and shopping bags, and it was never questioned. This money was just accepted by the casinos.

It didn’t matter if they lost the money. The concern was that the money laundering was happening in the casino. That didn’t matter. The money had already been moved. Basically, the criminal is washing the money in China and using the drug money that he’s receiving in Vancouver to fund the operation, and that connectivity between those entities is quite extensive. I do talk about it in the book at length, and that has set the stage for other agencies to start looking into it more deeply.

Unfortunately, in Canada, we haven’t had much success on the enforcement side, but we have been raising some awareness and now we’re gaining traction through this political interference piece of the hybrid warfare. It’s coming full circle.

Mr. Jekielek:
I’m trying to picture these duffle bags and hockey bags of money rolling in, and no one thinks this is odd?

Mr. McGregor:
When questions were raised about the fact this money was coming in, it was kind of explained away as being cultural—the Chinese whales didn’t like to use credit cards, and they always had cash because they were afraid of the regime coming in to take their money. Here you are in Canada, which is not China, and no one’s coming to take your money, because there’s actually no laws that allow them to do that.

They would say they own a restaurant or a shopping center or something like that, and they get a lot of $20 bills. But I don’t think anyone has $750,000 in $20 bills. It doesn’t make sense. But that was said by a subject matter expert on money laundering that was hired by the lottery commission who runs the operations of the casinos. It was kind of explained away.

The fact of the matter is that at the same time, all this money that’s coming in is benefiting the corporation that runs it, and the people that own the casinos. The brick and mortar, they’re not upset that a lot of money is coming in. The government is not upset, saying, “We have all this revenue coming in.”

Mr. Jekielek:
Because they’re getting a cut.

Mr. McGregor:
They’re getting this money. So yes, there’s a lot going on in terms of the amount of money that’s coming in and who’s involved and why there’s willful blindness to not do anything about it.

They were coached, the big whales that came in. The law enforcement was aware of who these people were that were coming in. They were interviewed and told, “Hey, you can’t do this anymore. You can’t bring these big duffle bags in.”

There was a move towards another method, and that method was bank drafts, one of the ways a lot of money was used at different levels, not just from the criminals. A major one called Silver International was run, and this is all open source now, by a fellow named Paul King Jin, and was investigated. The charges were stayed, and so he basically got away with something, in my opinion.

They were coached to go to a money service business and take their money and get bank drafts. Some of these bank drafts were third party bank drafts. It’s for somebody else, but you took it to the casino, and it’s $200,000. There’s quite a case there with an immigration and real estate lawyer named Hong Wo who had her trust account compromised by someone that worked for her.

That individual is connected to these networks and organized crime and everything else. They moved seven-and-a-half million dollars in bank drafts through the casino in two-and-a-half months. On her application, it’s saying that she’s a student. What kind of student has seven-and-a-half million dollars to go to a casino with? And no questions were asked. It wasn’t until the police got involved that suddenly there’s this interest in that kind of thing.

The bank draft issue is ongoing. While I was working with the gaming policy enforcement branch, my question was, “Why are they not doing electronic transfers? If you have to take their account information, regardless of where they’re from, they have to have a Canadian institution on their bank to have this account. Why wouldn’t they just e-transfer the money like people do every day when they’re making purchases? They are e-transferring money.”

That became an issue for them because no one wanted to have a trail, in my opinion. What they would say is, “It takes too long, because the transfer is coming from overseas. And I’m like, “There is no overseas. They have to have a financial institution, it states right in the policy, right here in Canada. There should be no delay whatsoever.”

The other thing they would say is, “They don’t want to wait. The gambler comes in, and he wants to gamble right now. He’s our VIP, we want to take him upstairs.” I’m sorry, but we’re talking about money laundering and the issues that are around it and the concerns. The public is aware, the government is aware, and law enforcement is aware. Why aren’t you doing the things necessary to put this in play? That is still not in place.

They also don’t use credit here in British Columbia, although they do in Ontario. Credit is a whole other issue of how that gets done, and how money gets moved. They are being coached on how to move that money using illicit money service businesses, meaning they’re unregistered. Sometimes money service businesses are in the back of a nail salon, and the nail salon is always closed except when somebody shows up that wants to get money, or a travel agency. These are known fronts for organized crime. That’s where this money’s coming from.

There were some rules that were put in place to make it look like something was being done about the money, and this was explained in the public inquiry. After I had briefed the attorney general and started the ball rolling, it really looked at money laundering in its totality, but it was kind of whitewashed. Everyone was trying to protect themselves when they got on the stand.

They were more concerned about being culpable than they were about finding a solution to what’s going on and doing the right thing. I was never called to the inquiry. I was never asked to testify. I don’t know how that’s possible when I was the only intelligence officer in gaming in Canada, and I’m the one that raised the alarm on this whole thing. That’s part and parcel for what’s called corruption or oversight. I’ll leave that to others to decide.

Mr. Jekielek:
In terms of a national security threat, all this type of activity, where do you rate the Chinese Communist Party and the scale of threats to Canada and to the US?

Mr. McGregor:
I would say that they’re the top of the scale. Russia is of concern, but is nowhere near the scope and scale of China. China adopted hybrid warfare and took it to a new level. That’s the difference with Hezbollah, but they also work together. This is a coalition of nation states that are conducting hybrid warfare, and that permeates downward. It involves organized crime, and it involves political leveraging.

We see this connectivity at all levels between these different elements. The cartels, the Iranians, and the Chinese work together extensively in the region that I’m in across Canada, and also throughout the United States. Those elements all work together. The evidence is there. It’s just a matter of trying to get people together to fight it.

Mr. Jekielek:
One of the things I was very surprised to learn about, and this is in the first chapter of The Mosaic Effect, is something called Operation Dragon Lord. This was a U.S. operation looking at all sorts of infiltration in Canada that was posing a threat to the U.S., and this was 25 years ago. This is news to me, so please tell me about this.

Mr. McGregor:
The document that you’re talking about was revealed to me a few years ago from an intelligence source, and it is an operation that follows a previous Canadian operation called Sidewinder. Sidewinder was a classified report that was declassified and was revealed on the open internet.

This was working in conjunction with the CSIS, the intelligence agency within Canada. That information talked about Chinese tycoons working with organized crime, the triads in Canada, influencing political entities. But it also looked at critical infrastructure and business in Canada and how it was corrupting and influencing entities therein.

Operation Dragon Lord was multi-agency under the Department of Justice, which included the FBI and the CIA and the NSA looking into the threat that was posed by Canada to the United States because of this infiltration. Like you said, this was 25 years ago. This is quite some time ago. This is remarkable. It’s never been discussed before.

The United States was looking at Canada as this major national security threat, and what was happening there has been progressing for 25 years. We now have complete saturation in Canada of these elements in every aspect of our business, our critical infrastructure, and law enforcement. It’s in everything that we’re doing right now, and it does pose a significant threat to the United States.

The United States, as we see now, is looking at decoupling from China. This political interference piece that we see being raised in Ottawa from this leak has now stirred this all up again, and we’re revisiting things that we saw 25 years ago, and that I’ve been trying to raise awareness about and gain traction on for at least the last five years.

Mr. Jekielek:
What does it mean to achieve saturation? That feels like a very strong word.

Mr. McGregor:
The saturation is really everywhere we looked. In every piece of information we saw the entities and where they were involved. It all started to come back to the same people, the same threat streams, whether they’re into the gambling piece, real estate, or espionage. All of those things started to come back and they were all connected.

These people were all intertwined, and it caused us to see that it didn’t matter where we looked. If you lifted the carpet up over here, there they were. Law enforcement is aware, but they’re very constrained in what they can do both by legislation and the laws.

For instance, in British Columbia, a police officer cannot charge someone. They can recommend charges, but the Crown Council decides whether or not those charges will be processed. This is where we’ve run into a lot of issues, where the confidence in getting things to enforcement is not something that the police feel that they can achieve. It feels like it’s biting off more than they can chew. That’s caused a lot of issues and a lot of discontent amongst law enforcement, security, intelligence, and defense.

What can we do about this? We’re just limited without a government that’s going to back those things. This is what we’re seeing with this political influence piece. That push has been held off for so long and we are not able to do it. The United States is starting to get concerned about those things, and that is raising an awareness within the United States about what’s going on in Canada and how it can impact them. And it will definitely impact them.

Mr. Jekielek:
People both in the U.S. and in Canada are kind of baffled by the level of ignorance about Chinese Communist Party infiltration through this unholy mix of the intelligence services, the triads, organized crime, and business. That mix in itself isn’t something that we discuss a lot over here. Does the same thing exist here?

Mr. McGregor:
Very much so. Those same entities are conducting the same kind of activity within the United States, and that is concerning because the scope can be that much larger. There’s that much more money to be had and support to be gained. Because the true force behind the West is the United States. The ultimate goal is to undermine the United States. That’s what China’s trying to do. They have a plan for world domination by 2049.

With the distraction techniques, we will see people being called racist. When we’re talking about political platforms, the CCP is communism, we’re not talking about race at all, it has nothing to do with that. Lawfare is another way that the CCP will come after people. They will hire the best lawyers and law firms, and we’ve seen it in Canada over and over again. We’re seeing it in the United States as well. There are these tactics, techniques, and procedures that the CCP, the United Front Work Department, and all of their allies use to undermine any efforts to call them out, subvert them, or try to stop them, and they’re doing a good job. It’s been 25 years and now suddenly people are interested again.

Mr. Jekielek:
Case in point, Sidewinder was sidelined way back then, although the full version of it was leaked later on. You had your various units along the way where suddenly there was a lot less interest in them after you got to a certain point. What happened to Operation Dragon Lord?

Mr. McGregor:
That’s a very good question, and that’s something that should be raised again to see what happened and where the initiative was lost. They’re stating in this document that there’s a war going on, and actually, there really is a war going on. We are at war with China. Canada’s at war with China, certainly. Canada just doesn’t realize it.

If we just look at the cyber attacks alone, it’s 3000 attacks per minute in the province that I’m from on government infrastructure from the CCP and from the People’s Liberation Army. The United States, I’m certain, has similar things, especially in the cyber domain. But this hybrid warfare piece is not kinetic. It is not conventional.

We don’t see the conflict. The awareness from the public is that this is corporate, this is business. They’re not wrong, but there’s intent to it. This is not organic. This is not holistic. This is a direct attempt by the Chinese to take control, and it is about control.

Follow the money is a great term when you’re looking at money laundering. But when we’re talking about hybrid warfare, it’s about control, controlling the narrative, controlling industry, and controlling trade agreements. All of it is about control. That is my greatest fear, because I see that control getting stronger every day.

Mr. Jekielek:
It’s very interesting that Dragon Lord basically identifies the fact that the U.S. is at war. That’s amazing because that was way ahead of its time. We have this documentary called The Final War, and The Final War is exactly about what you talked about. It’s the CCP’s plan to dominate ideally without firing a shot, but using all the different forms of persuasion, influence, propaganda, money and military.

Here in the U.S. it has taken people quite a bit of time to grasp that all these different tools like the lawfare that you mentioned, these many different tools are actually warfare and not just business.

Mr. McGregor:

Mr. Jekielek:
Or something like that. This is what General Spalding has been advocating for the past few years.

Mr. McGregor:

Mr. Jekielek:
It’s obviously the same in Canada from our discussion here. Does it feel to you like we’re remotely ready to face this at this point?

Mr. McGregor:
The infiltration is so large and so great, and the scope and the depth of that infiltration is difficult for people to understand. The concept of boiling the frog slowly so he doesn’t jump out is exactly what has been taking place. The Chinese work on a much longer cycle than we do, like 30-year cycles.

We’re just looking at the next election, and we’re focused on a lot of things to try to keep us in power. When you have that kind of control, and Xi has consolidated power, they have time. And this has been sped up considerably.

As a matter of fact, some people have actually told Xi, this isn’t the right time, you’re not supposed to do this. But the analyst that I’ve been speaking with feels that it’s not just ego, but he feels that in his legacy, he wants to achieve these things. He wants to surpass Mao. He wants to be this figure that China will remember, that he’s made this change globally. It’s his time and he’s rapidly moving towards it.

But in the West, it’s business as usual. We have a quality of life that is great. In Canada, it has to start to impact us, and this is part of the reason why this awareness is coming. Canada is now starting to feel the crunch with recession, and with our economy struggling. China was there to support Canada in this economic sense.

Unfortunately, Canadians believe everyone has good intentions, and we don’t think that someone would have ill intent towards us, not realizing Canada’s sitting on a vast natural resources reserve from oil, LNG, forestry, and freshwater. I believe we have the most freshwater in the world. Why wouldn’t a country want to come here?

China’s looking at having 20 nuclear icebreakers being made, and they’ve laid claims to the Arctic for mineral resources and other things. Why? Why would they do that? They don’t have a need for any icebreakers. There is definitely a plan for Canada and North America, when you have a population that needs those resources.

The illegal fishing piece is because China imports most of its food. There’s a lot of strategic pieces at play. The South China Sea is one of the largest choke points in the world. By choke point, that is where the flow of goods comes through, namely oil and gas that comes from Iran and the Gulf region through the Malacca Straits. That is coming to China and Japan. Not as much comes to the West, but it’s a necessary piece. Controlling that is vitally important.

But in the West, Canadians and Americans aren’t as concerned about these things, because they’re not touching them at home in that sense. Canada’s starting to feel it, though. Canada’s starting to realize we can’t afford real estate.

Vancouver is the most expensive place in the world for real estate. People cannot afford to live there. They have to leave to be able to afford real estate. They’re moving to provinces that are ice-cold because they’ve had to go north.

People are starting to go, “Hey, why? Why is that? Is that the government? What’s the cause of this?” The root cause is now being unveiled, if you will, and they’re looking for those answers. This is really the start of an awareness within North America about where the real threats are.

Mr. Jekielek:
You mentioned the illegal fishing, so very quickly, certainly this is kind of a profoundly massive thing that’s happening that the CCP is engaged in. Why don’t you just briefly tell me about that?

Mr. McGregor:
This is an interesting topic, because it’s actually something that came up. I mentioned the think tanks I was holding on a military base, and I brought in the Five Eyes intelligence groups to discuss these things. New Zealand really brought forward some concerns. Although all of the Five Eyes have been concerned about this.

China has a massive illegal fishing fleet that goes around the world collecting and grabbing all of the fish that they can find. They surrounded the Galapagos Islands. It was reported on, and it was a blip in the news. But this happens everywhere. They’re going around and they’re illegal fishing, and not much can be done about it.

It’s probably, in my estimation, in the trillions of dollars. It’s the largest illicit activity in the world, they’re getting away with it, and they can do it. If we can’t figure that out, then we’re in some deep trouble.

Mr. Jekielek:
Talking about hybrid warfare and unrestricted warfare, we’re also very aware that these fishing boats also are equipped to support the Chinese Navy, with the idea that they may need to be called upon at any time. They act like a reserve military.

Mr. McGregor:
They’re a militia, yes. They actually bring their uniforms in their fishing boats. This is extensively used in the South China Sea. The Philippines and other countries are experiencing having their fishing vessels surrounded. But then they put their vests on and they call the Chinese military, the People’s Liberation Army Navy, and they’ll come.

They have fired on vessels. They’ve forced them to flee the area. They’ve captured their cargo, and lots of different things and incidents that have occurred with that. They’re a militia. They are operating in both areas, both the civilian world of fishing, and then in order to control that area, they throw on their militia uniform and have the backing of the CCP.

Mr. Jekielek:
One thing that is a very devastating element of this asymmetric hybrid warfare is Fentanyl.

Mr. McGregor:

Mr. Jekielek:
Something that you told me was that 25 to 35 percent of the Fentanyl coming to the U.S. is actually coming through the Canadian borders, coming from the north through Vancouver, and not from the South. You typically only hear about the Mexican border.

Mr. McGregor:
Yes. The threat from Mexico has been highly publicized. There are movies about it, the Sicario movie and that kind of thing. It’s the El Chapos and it’s almost romanticized in a sense. There has been some documentary filmmaking that explained there’s a connection between China and Mexico, and they’ve taught them how to do certain things, like how to create Fentanyl.

What really isn’t known is that the epicenter for fentanyl is Vancouver. We were having, like I mentioned earlier, 900 deaths a year from Fentanyl overdoses. We are the direct shipping lane from China to North America, the shortest route coming into Prince Rupert, which is just north of Vancouver. We are having massive quantities of precursors being sent to individuals that we know are connected to illicit activity in the creation of Fentanyl.

Vancouver is known as a trans-shipment point across the Pacific to Japan, Australia and others, but also to the United States. Being able to create something in Canada with a border that is the largest undefended border in the world with our largest trading partner makes it quite easy to get that product into the U.S. There’s starting to be a little more awareness, but again, enforcement in Canada, stopping it before it can get there is just not happening.

Mr. Jekielek:
Knowing everything you know, what’s the worst case scenario here?

Mr. McGregor:
The worst case scenario is that after gaining traction and getting people aware of the threat from China, we put our head back in the sand, and it’s brushed off as conspiracy theory. What keeps me up at night is that we are going to lose our ways, our means, and everything.

Mr. Jekielek:
Our sovereignty.

Mr. McGregor:
Our sovereignty. That is all in jeopardy right now. The United States is in just as much jeopardy as Canada, especially with the fact that we have this saturation that I’m talking about in Canada.

What are we going to do if we go kinetic? If something happens in the South China Sea or Taiwan, and suddenly the United States goes to war, which means the allies go to war, now we’re in an actual conflict and we have had all of our critical infrastructure compromised. Our politicians have been leveraged. Every aspect of our society has been touched.

How are we going to reverse that? In what timeframe will that take place? We’ve had 25 years of someone trying to raise awareness, and it’s been shut out in the name of, “I’d like to make money.” It’s more greed than anything. Hopefully, we can make a difference and change that.

Mr. Jekielek:
In the building behind you there’s a committee that is set up to deal with strategic competition with communist China. There’s actually a number of committees that are looking at the China threat as we speak. What is it that you would hope you can accomplish with your information while you’re here?

Mr. McGregor:
I’m hoping that the traction that we’re starting to see in Canada lights a flame, and that flame can be fanned by the rest of the Five Eyes, mostly the United States, because the United States is really the powerhouse within the Five Eyes, especially in the intelligence world. They have the most resources, most collection assets, and the greatest power of influence.

They have to grade that information, and have the understanding of how impactful all of these different levels are, and that there’s a concerted effort to do that. It’s not just that some scientist has collected some information and has sent it back to China for dual-use technology, all of those pieces are there. But that it’s a concerted effort, it’s coordinated, and that information is going back to the motherland, back to where it’s being consolidated and exploited, like intellectual property. All those things are impacting the private sector, but also the public sector.

Knowledge is being sucked out of the West. Innovation is being sucked out of the West in exchange, most of the time, for money. We need to start to look inward at how we can defend against all of those efforts. Part of it is this decoupling piece that I’m not against. You have to take a stand at some point, and I think that stand is starting to form now.

Mr. Jekielek:
Scott McGregor, it’s such a pleasure to have you on the show.

Mr. McGregor:
Thank you for having me. I really appreciate your time.

Mr. Jekielek:
Thank you all for joining Scott McGregor and me on this episode of American Thought Leaders. I’m your host, Jan Jekielek.

This interview has been edited for clarity and brevity.

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