Here comes the bride - and jail



August 24, 2005


 

US authorities said they were startled at the syndicate's brazen ambition and its level of sophistication smuggling in vast quantities of contraband and virtually undetectable counterfeit US$100 bills. AFP

After their wedding guests had streamed into Atlantic City, New Jersey, for the festivities Sunday on board the yacht Royal Charm, the happy couple surprised them all - by having them arrested as part of an alleged international Asia-based organized crime syndicate.

Unbeknown to the attendees, many who came from China for the occasion, the bride and groom were undercover FBI agents. The US government said Monday that the pair had spent four years investigating a sophisticated racketeering enterprise suspected of smuggling into America vast quantities of black-market cigarettes, high-tech weapons, Ecstasy, counterfeit Viagra and virtually undetectable counterfeit US$100 bills.

The wedding, US Justice Department officials said, was part of an elaborate trap designed to entice alleged members of the crime syndicate into America so they could be arrested and charged.

Several dozen of them were taken into custody while on the way to the dockside ``wedding ceremony,'' dressed in their wedding finest and apparently shocked at the turn of events, according to one Justice Department official.

``They were literally being taken out of their limos and into custody,'' one Justice Department official said. ``Some of them were bearing gifts, expensive ones like Rolex watches.''

By Monday morning, at least 59 individuals were arrested in Atlantic City, Los Angeles, and nine other locations in the US. Authorities were searching for at least 28 other individuals indicted by federal grand juries on both coasts.

The Justice Department official said most of the alleged ringleaders of the syndicate had been taken into custody, including members of the Hsu family of China, whom federal authorities contend in court documents organized and ran the global operation.

The Justice official and other US authorities said they could not discuss many aspects of the case because it is ongoing and involves sensitive relationships with various overseas law enforcement agencies, including in China and Canada.

But authorities said they were startled at the syndicate's brazen ambition and its level of sophistication, even in comparison to other Asia-based organized crime groups that have long operated in the United States.

Of particular concern, Secret Service officials said, was the group's apparent ability to generate counterfeit US currency that can fool even the most sophisticated detection devices.

The group also used factories in China to churn out as many as one billion counterfeit cigarettes for sale in the US, some under the Marlboro and Newport brands.

They also engaged in levels of money laundering and drugs and weapons trafficking that far outpace traditional Asian and European organized crime groups, top federal law enforcement officials said.

There was no indication that the smuggling ring had terrorist ties, officials said. But Homeland Security officials are concerned about inbound shipping containers hiding explosives.

``This was a one-stop-shopping criminal organization that had the will and the means to smuggle virtually every form of contraband imaginable. For those reasons alone, the organization posed a serious homeland security threat that we are happy to close down today,'' John Clark, deputy assistant secretary for US Immigration and Customs Enforcement at the Department of Homeland Security, said.

Deputy FBI Director John Pistole said the group was active in at least a dozen US cities, in Canada and elsewhere overseas. ``Asian criminal enterprises pose a unique and complex law enforcement threat due to the fluid nature of their enterprises,'' Pistole said.

The arrests followed two parallel undercover law enforcement operations, dubbed ``Royal Charm'' in New Jersey and ``Smoking Dragon'' in Los Angeles. In the investigation, the FBI was joined by agents from the US Secret Service; Bureau of Alcohol, Tobacco, Firearms and Explosives; Customs and Border Protection; Postal Inspection Service and the Department of Labor's Inspector General.

Canadian authorities also participated, the US officials said.

Pistole confirmed that some of those indicted and arrested in recent days are US citizens. But he and other authorities declined to say how many of the suspects were Americans, or whether any played leading roles in an alleged conspiracy dating back five years.

The Justice Department unsealed 11 indictments in the case on Monday. They describe in hundreds of pages the alleged illegal activities of the China-based syndicate, from the alleged leadership of the Hsu family to the international network of buyers, sellers and manufacturers of illegal goods.

Most of those arrested, including Bruce Hsu and people identified as members of his extended family, face federal charges of racketeering, smuggling, counterfeiting and fraud that could bring them dozens of years in federal prison if convicted, authorities said.

Authorities would not disclose the identities of the two undercover agents who had posed as the bride and groom. But they added the pair had spent years gaining the trust of dozens of alleged co-conspirators operating at the highest levels of the smuggling operation.

Their cover story worked so well, said Christopher Christie, the US attorney in Newark, that authorities decided to incorporate the two agents' ``relationship'' into their plans to take down the syndicate. Six of the indictments, including three racketeering indictments, were returned in New Jersey and charged 57 individuals with smuggling the counterfeit US currency into the United States in containers with false bills of lading for toys, furniture and other goods.

In October 2004, one container loaded with about US$338,000 (HK$2.64 million) in counterfeit currency arrived in Newark, New Jersey; two months later another contained nearly US$3 million in counterfeit currency, the indictments allege.

Undercover agents ordered a third shipment of nearly US$2 million before the operation was shut down.

Syndicate members used the same strategy to smuggle US$2 million in counterfeit cigarettes; 36,000 Ecstasy pills, and more than 454 grams of methamphetamine into the US, the affidavits allege.

The indictments also allege that two defendants, in conversations with undercover federal agents, entered into a US$1 million deal to provide silenced pistols, rocket launchers, silenced sub-machine guns and other weapons to undercover agents.

The US attorney for Los Angeles, Debra Wong Yang, said Operation Smoking Dragon had resulted in four indictments and the seizure of nearly US$1.2 million in counterfeit currency, US$40 million in fake cigarettes, 9,100 Ecstasy pills, methamphetamine and large amounts of counterfeit Viagra and other pharmaceuticals.

LOS ANGELES TIMES

 


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