Tell Us from Whence Your Riches Derive: Manitoba’s First Unexplained Wealth Order

Author: Professor Michelle Gallant*

Manitoba obtained its first unexplained wealth order early in November. In a case alleging the theft of cash offerings from a religious organization, the province successfully exercised its power to compel someone to disclose their source of wealth. The tool is designed to deal with criminal assets and the financial dimensions of crime. A failure to meet the terms of an order has perilous consequences.

Those who follow developments in this area are apt to find the context of this first deployment a bit unusual. By the same token, unexplained wealth orders spark vexing arguments about their compliance with the rule of law. It may very well be that the initial Manitoba venture settles before stirring much dust. Still, receipt of the first order launches Manitoba into the unexplored terrain of unexplained wealth law. For that reason alone, it elicits interests

Unexplained Wealth Orders

An unexplained wealth order compels someone to explain the provenance of their wealth. Aptly named, unexplained wealth connotes the notion that a person’s wealth is disproportionate to their lawfully sourced income: for example, someone in receipt of social assistance who drives a Bentley, inhabits a pricy home and maintains a hefty bank balance. The palpable disconnect between possessions and sources of lawful income, so to speak, begs for an explanation.

If an adequate explanation is not provided, unexplained wealth law typically assumes that the wealth derives from crime. The disproportion may be the result of an inheritance or the product of some previously unknown lawful income source. If the provenance is legitimate, it can be fully explained. If not, if an order is not complied with, then an unlawful derivation is presumed.

There is swelling global interest in using such orders to help harvest assets tainted by criminality. This is because to divest unlawful wealth, the resource must obviously be traced and tied to some underlying crime. However, to follow the wealth, forensic experts must typically unravel byzantine – often global - financial structures. To track and connect a source of wealth to crime, they must unpack complexities that the wily criminal entrepreneur inserts to blur the asset trail. Axiomatically, the wealth holder is ideally poised to ‘explain’ the wealth’s derivations: they know the source. Unexplained wealth orders solve the tracking problem. Assets can be readily reaped if an adequate explanation is not provided.

Obviously instrumental, they equally breed controversy. While they are popular because they help the harvest, they invert, using presumptions, conventional legal ordering. Law generally maintains that he who alleges must prove. If someone alleges that wealth emanates from an unlawful source, the alleger bears burden of proof. To discharge that burden, the alleger must overcome the threshold, in a civil proceeding, of a balance of probabilities. Unexplained wealth law classically provides that the alleger receives an order based on some suspicion, or very low proof threshold, that the origins of the wealth connect to crime. Once an order issues, the wealth holder must explain that this is not so - must demonstrate lawful provenance - at the risk of the presumption of an unlawful root. Helpful to the project of divesting criminal assets, unexplained wealth law burdens wealth holders with proving lawful origins rather than those who allege an underlying criminal acquisition.

Manitoba Unexplained Wealth Law

Prompted by concerns about organized crime, gang activity and criminal assets, Manitoba chose to enact an unexplained wealth regime.1 For the province to obtain an order, a court must be satisfied that there are reasonable grounds to suspect a respondent’s (the wealth owner or possessor) known sources of lawfully obtained income would be insufficient to enable the acquisition of certain property and that the respondent, or someone closely connected to them, has been involved in unlawful activity.2 If these criteria are met, the court must issue the order unless if, in the court’s discretion, the order would not be in the interests of justice. A failure to comply with an unexplained wealth order triggers a rebuttable presumption that property constitutes the proceeds of unlawful activity.3

The orders are functionally integrated into Manitoba’s civil forfeiture law, an apparatus that permits the forfeiture of the proceeds, or instruments, of unlawful activity. ‘Unlawful activity’ denotes crime and offenses of less severity.4 The apparatus enables the forfeiture of property upon proof, in accordance with the civil legal standard of a balance of probabilities, that it derives from unlawful activity. Unexplained wealth orders are sought within this mechanism. Non-compliance with an order triggers a rebuttable presumption that property is the proceeds of unlawful activity for the purpose of forfeiture.

The November Order

In September 2024, a Manitoba religious organization reported alleged thefts to police. Their head pastor of over a decade was allegedly stealing from the donation box. The organization had installed a first camera – which was known to the pastor – and a second secret battery-operated camera in the area where the donations were kept. On one occasion, video showed the pastor turning off power to the first camera. On another, the secret camera captured the pastor turning off power to the first camera, shaking coins and currency from the donation box onto a sheet, and turning the power back on to the first camera.

Upon investigation, a search of a room on the premises exclusively occupied by the pastor found hidden batches of cash totalling over $400,000. Since 2013, he had been employed by the organization and, in return for his service, received room and board, and $1000 a month. In 2019, information revealed the pastor had bought a house for $332,000 and the associated mortgage had been fully paid.

The pastor was charged with theft. The religious organization filed a civil action recover the allegedly misappropriated donations. The province commenced civil forfeiture proceedings and, within that action, applied for an unexplained wealth order. On November 3, 2025, the court granted the first Manitoba unexplained wealth order.5

A New Field of Legal Inquiry

The November order marks Manitoba’s entry onto untilled terrain. Of the Canadian provinces, only Manitoba and British Columbia have enacted unexplained wealth order regimes. BC received its first order in the August of 2025.6 Analysis of compliance with the rule of law awaits.

In a way, the first Manitoba exercise surprises. A pastor allegedly siphoning from a religious entity is not a context that might have been predicted for an unexplained wealth order. There are no hues of profitable organized crime, the likes of associations with Manitoba gang activity. The money trail appears to be reasonably clear, not unduly cluttered by complex cross-border financial transactions. Tentative attempts in B.C. could be said to align more neatly with the contextual features apt to prompt resort to an unexplained wealth order – drugs trafficking, millions from a United States fraud, and the fruits cryptocurrency shenanigans. The Manitoba order fits – disproportionate wealth and the specter of crime. It is merely an unexpected context for a first exercise of such orders.

Notably, too, Manitoba leads in this field of law. In its inquiry into provincial money laundering, the British Columbian Cullen Commission recommended, in 2022, that B.C. enact an unexplained wealth regime. 7 Manitoba already had an initial template in place. The Cullen Commission plaintively pointed this out. BC has since enacted a regime.  Manitoba remodeled its initial template into a 2024 version. No doubt other provinces are watching Manitoban developments. It is clearly a leader in adopting a new approach to tainted wealth.

Long before the first practical Manitoba launch, tensions around compliance with the rule of law had begun to accrete. In contemplating such tensions, the B.C. Cullen Commission solicited an opinion on whether unexplained wealth orders fell within provincial legislative competence and whether they aligned with constitutional exigencies.8 While obviously not binding on future judicial ruminations, the opinion determined that such orders came within provincial competence in relation to property and civil rights. Significantly, the opinion was undergirded by a Supreme Court of Canada ruling that provincial civil forfeiture law – the regime unto which such orders fuse – lay within provincial legislative competence.9

With respect to Charter of Rights dimensions, the opinion identified problematic aspects related to information sharing between authorities charged with investigating criminal matters and those concerned with civil matters. The constitutional Charter edicts are sharper and more demanding in the context of criminal matters. Conflicts could occur if information derived from a civil matter – one not subject to the firmer rules governing criminal matters – flowed upwards.

Notably, Manitoba law specifically enjoins the use of, or any disclosures of, responses to unexplained wealth orders for the purposes of other proceedings.10

The first uses merely hint of possible challenges. The Manitoba court, in issuing the November unexplained wealth order, gave short shrift to the self-incrimination angle. The protection against self-incrimination applies to criminal proceedings, not to civil proceedings: it does not avail in a civil context. Nor did complaints about multiple proceedings – a criminal action, a civil action by the victims, and the unexplained wealth order – attract any traction. In B.C., the respondent alleged that the orders unconstitutionally presumed guilt but proffered no cogent argument. The court simply acknowledged that the Supreme Court of Canada had determined that civil forfeiture law, the setting for unexplained wealth orders, was constitutionally valid.

No doubt that the legal landscape is not settled. It will develop. Privacy rights and due process rights might feature in that development.  Whatever shape challenges may assume, a fundamental element of unexplained wealth orders merits account. The mechanics of Manitoba’s regime result in the forfeiture of property grounded on suspicion alone: suspicion leads to an order, and, if wealth is not adequately explained, a rebuttable presumption of forfeiture arises.

Tied together, the province is only burdened with establishing suspicion of crime. An extraordinarily powerful tool perhaps. Whether the urgencies of plucking criminal assets warrants forfeitures ultimately governed by mere suspicion – is a very real question.

November 2025 marks the first issuance of a Manitoba explained wealth order. The situation remains in a state of flux. Criminal proceedings are on-going as is the civil action by the victimized organization. Only time will tell of compliance with the order. In the event of non- compliance, the rebuttable presumption will be triggered. Consonance with the rule of law is a story that is unfolding. It is certainly a context worth watching.

A house with piles of riches at the frontage

Endnotes

*Dr. Michelle Gallant has been a full professor at Robson Hall Faculty of Law at the University of Manitoba since 2014, having taught at the faculty since 1999. Her areas of teaching and research focus are on Taxation, Philanthropy of Law, International Law, Dispute Resolution, Money Laundering and Terrorist Finance.

1 The Unexplained Wealth Act (Criminal Property Forfeiture Act and Corporations Act Amended) SM 2024, c. 19. The amendment replaced a previous model which spoke of ‘disclosure’ rather than ‘unexplained wealth’ orders: Criminal Property Forfeiture Amendment Act SM 2021, c. 50.

2 Criminal Property Forfeiture Act, CCSM, c C306, s 2.5(1) (hereinafter the CPF Act) The court must also be satisfied that the respondent owns, possessed or has an interest in the property and that the fair market value of the property exceeds $125,000.

3 CPF Act, s 17.1.

4 CPF Act s 1(1).

5 Director of Criminal Property vs Singh, Sukhwinder, November 3, 2025, C125001-51945.

6 British Columbia (Director of Civil Forfeiture) v Huang, 2025 BCSC 1568.

7 Recommendation 101: https://www.cullencommission.ca/files/reports/CullenCommission-FinalReport- Recommendations.pdf.

8 Constitutionality of Possible Changes to the British Columbia Civil Forfeiture Act, opinion provided by Honourable Thomas Cromwell to the Commission of Inquiry into Money Laundering in British Columbia.

9 Chatterjee v Ontario (Attorney General) [2009] 1 SCR 624.

10 CPF Act s 2.8.