Asian Criminal and Terrorist Activity in Canada/asian
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Asian Organized Crime
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Unlike traditional organized crime groups such as the Italian La Cosa Nostra, Asian organized crime groups, including both those groups that were established in Canada and those that originate abroad but have members operating in Canada, lack a set structure at the operational level even if a hierarchy exists at the organizational level. This is true of Chinese tongs, gangs, and other organized crime networks. The traditional Chinese triad societies, originally secret societies, some of which have existed for centuries, also operate in this fashion at the operational level. The Chinese triads, which have offices, ranks, and oaths, use this hierarchical structure to bond members, but not to dictate their activities. However, if a parent organization exists, these groups still maintain certain loyalties to that organization. This loyalty 28 Canadian Embassy, “Canada’s Actions Against Terrorism Since September 11th,” Washington, D.C.: 2003. <http://www.canadianembassy.org/border/backgrounder-en.asp> 29 Berlau. Page 14 Library of Congress – Federal Research Division Asian Criminal and Terrorist Activity in Canada 10 is often expressed in terms of assistance to members who are relocating and in pursuit of profitable ventures for members, when it is convenient. Even when part of a specific well-known group, such as the Big Circle Boys, for example, members often operate in small, cell-structured groups or partnerships, if not independently, when engaging in illegal activities. Subsequent to the achievement of a particular goal, these partnerships often are dissolved. As documented by the 2002 annual report of the Criminal Intelligence Service Canada (CISC), these groups demonstrate “structural fluidity and flexibility.” 30 It is not at all uncommon for members and associates of these groups to conduct numerous dissimilar criminal activities, often with different groups simultaneously, be they ethnically homogenous or heterogeneous. 31 It is because of this decentralization that specific details on individuals and groups are often unavailable, at least in open source research materials. In contrast to the Cosa Nostra, which is organized in a pyramid structure, making it possible for law enforcement to trace the organization to its highest level, Asian organized crime groups are organized more as autonomous mini-pyramids, with small cells and mini-bosses dictating the actions of only their particular cell. More sophisticated organized crime groups include individuals who engage in frequent travel, both domestically and internationally, often for the purposes of evading law enforcement. 32 Established groups routinely use youth and street gangs as a labor resource as well as a means to expand their activities. Canada’s Asian crime groups are more complicated to combat than groups such as the Italian Cosa Nostra because of historical and geographical factors. Asian organized crime groups place high priority on ethnicity for membership in their organizations. This fact is especially true for the more traditionally oriented Chinese triads. There are few, if any, accounts of non-Asian members being accepted in their networks. Hence, given the lack of Asians in U.S. and Canadian law enforcement, the networks are difficult to infiltrate. U.S. and Canadian law enforcement authorities presently are unable to strike at the core of many triads, which often are located in countries where broad cooperation between law enforcement officials currently does not exist. And in many cases, the independent and cell- structured nature of most Asian organized crime groups makes it unlikely that destruction of the 30 Criminal Intelligence Service Canada, Annual Report on Organized Crime Canada (Ottawa: 2002) <http://www.cics.gc.ca> 31 Ibid. 32 Yiu Kong Chu, The Triads as Business (New York: St. Edmundsbury Press 2000). Page 15 Library of Congress – Federal Research Division Asian Criminal and Terrorist Activity in Canada 11 central authority of the more organized triad groups would have any substantial detrimental effect on operations in Canada and in the United States. The presence of various cells from the same organization in different cities or countries also gives these groups contacts that they can trust and do business with. These cells have proven to be of great advantage to a criminal group like Big Circle Boys, for example, allowing the group to combine its various assets and expertise for the perpetration of transnational crimes. In recent years, some experts have noted that non-triad groups constitute the majority of Asian organized crime activities. Since 1994, three years before the return of Hong Kong to Chinese rule, crimes perpetrated by triads have not risen above 3.8 percent in Hong Kong as a result of the efforts of law enforcement. 33 Organized crime groups may exaggerate their links with triads in order to inspire fear. As a result, it has become increasingly difficult to determine whether triads or more contemporary syndicates commit transnational crime. Therefore, law enforcement’s view regarding triad involvement at all levels may need to be reexamined. 34 Furthermore, the formal links between the triads in Hong Kong and their members abroad are becoming increasingly questionable. The links may be only temporary and exist to facilitate taking advantage of certain opportunities, rather than being institutionalized. 35 However, triad societies do play vital roles in transnational organized crime activities. Types of Crime Heroin Trafficking Background The United States-Canada Border Drug Threat Assessment of December 2001 estimates that 95 percent of all heroin entering Canada originates in Southeast Asia. 36 Chinese organized crime groups in Canada almost exclusively traffic heroin produced in Southeast Asia, primarily originating in parts of Burma, Laos, and Thailand, known as the “Golden Triangle” region. 33 John Hill, “Triad Societies Seek Increased Opportunities as China Opens Up,” Jane’s Intelligence Review, January 1, 2003. <http://www.janes.com> 34 Chu, 119. 35 Hill. 36 Criminal Intelligence Service Canada, Annual Report on Organized Crime Canada ( Ottawa: 2002). <http://www.cics.gc.ca> Page 16 Library of Congress – Federal Research Division Asian Criminal and Terrorist Activity in Canada 12 Canadian intelligence additionally suggests that Burma is becoming a major source of ecstasy and that Asian organized crime groups soon will move to exploit the situation. 37 According to the Criminal Intelligence Service Canada (CISC), all major heroin seizures in 2000 and 2001 involved Asian organized crime groups, although these groups may link with other groups to facilitate their activities. The report further found that Southeast Asian heroin usually enters Canada through Vancouver, Toronto, or Montreal via international airports and major British Columbia marine ports. The CISC also reports that Asian organized crime groups use the northern half of Saskatchewan for the importation of heroin and cocaine from British Columbia and Alberta. In addition, the CISC reports that Chinese and Vietnamese drug syndicates based out of Edmonton, Alberta, and Calgary now have established a permanent presence in these regions and that Ontario groups are continually involved in the large-scale importation of heroin. 38 The presence of these groups in Canada is a threat to the United States. The groups that smuggle heroin into the United States often operate on both sides of the border and control distribution. 39 Furthermore, several organized crime groups overseas are involved in shipping heroin to Canada for the very purpose of exploiting the porosity of the U.S.-Canadian border. 40 Heroin trafficking, in particular, involves the cooperation of various groups at different levels to get the product to its final destination. For example, street gangs often act as enforcers who are, in turn, supported by more established and powerful groups. 41 These trafficking groups are independent and diverse, composed of both triads and other criminal organizations. Although individual triad members reportedly are involved in trafficking heroin to the United States through Canada, the triads as organizations do not control the trade. 42 Triad membership is more a prerequisite for sellers to gain permission to sell drugs at the street level. No such membership seems to be required for entering the international drug market. The October 2001 discovery of a highly organized Asian syndicate with direct links to Canada 37 United States Department of Justice, National Drug Intelligence Center, Heroin Distribution in Three Cities (November 2000). <http://www.usdoj.gov/ndic/pubs/648/intro.htm> 38 Criminal Intelligence Service Canada, Annual Report on Organized Crime Canada (Ottawa: 2001). <http://www.cics.gc.ca> 39 Royal Canadian Mounted Police, Criminal Intelligence Program, “Drug Situation in Canada – 1999” (Ottawa: 2000). <http://www.rcmp-grc.gc.ca> 40 Ibid. 41 Ibid. 42 Chu, 119. Page 17 Library of Congress – Federal Research Division Asian Criminal and Terrorist Activity in Canada 13 exemplifies the lack of triad control over the drug trafficking industry. Approximately 430,000 tablets of ecstasy with a value of US$30m were discovered heading toward Australia; this cache was the second largest seizure of amphetamines ever recorded. 43 Although one of the men arrested reportedly had links to the Sun Yee On triad, the ecstasy movement was not a triad operation. From the magnitude of this seizure it is apparent that international crime syndicates have real power in the drug trade, despite only tangential identification with a major triad. It is not uncommon for a member of one triad to team up with another triad member and work for the leader of a heroin smuggling group who is not a member of any triad at all. 44 The situation is viewed as a private business transaction. Still, triad membership can be essential for purposes of networking and the development of criminal relationships based on trust. It should also be noted that no consensus exists on the degree of triad involvement in the Canadian drug trade, and some officials believe that the triads control the market. 45 Heroin-Related Activity Affecting U.S. and Canadian Interests: 1999-2002 Heroin from Southeast Asian and China has been entering Western Canada for many years on its way to North American markets. In January 1999, The Vancouver Sun reported the Royal Canadian Mounted Police’s (RCMP) seizure of 70 kilograms of heroin in Richmond Country and two Mercedes Benz automobiles, one in Toronto and one in Vancouver. Five people connected to the seizure were arrested in Toronto, Richmond County, British Columbia, and Hong Kong. According to the report, the police claimed that those arrested were part of a major organized crime group that was stockpiling Golden Triangle heroin in Vancouver before shipping it out to points throughout North America. 46 In June 1999, the RCMP broke up a global drug smuggling syndicate that was controlled out of Hong Kong and trafficked heroin from the Golden Triangle. With profits estimated in the multimillions, the group shipped narcotics to Vancouver, where triad groups in Canada then transported the heroin to the rest of the North American market. The drug smuggling syndicate was discovered in December 1997; Vancouver detectives reported that it had been in operation for a number of years prior to its discovery. 43 Neil Mercer, “$30 M Drug Seizure Cracks Crime Syndicate,” The Sydney Morning Herald, October 18, 2001. (Lexis Nexis Document) 44 Chu, 110. 45 “Wa Link to Triad Confirmed,” The Bangkok Post, December 22, 2000. 46 David Hogben, “Warehouse in Richmond Yields 70 Kilos of High-Grade Heroin: Arrest of Five a Major Blow to Organized Crime, Police Say,” The Vancouver Sun, January 20, 1999, B1. (LexisNexis Document) Page 18 Library of Congress – Federal Research Division Asian Criminal and Terrorist Activity in Canada 14 Over 30 Hong Kong residents were arrested in Canada and the United States. 47 A number of individuals belonging to the syndicate also were charged with being linked to extortion and credit card fraud and were suspected of links to Macau triads. 48 Law enforcement officials in the United States and Canada cooperated in numerous police actions to curtail illegal narcotics activity. In June 1999, Project E-PAGE resulted in the arrest of 28 members of an Asian organized crime group active in British Columbia and various cities within the United States, Thailand, Hong Kong, and Burma. Law enforcement authorities in the United States recovered 6.3 kilograms of heroin and thwarted several planned conspiracies to import additional heroin to North America. 49 In August and September of 2000, a year-long investigation, named Project Occlude, resulted in the seizure of 57 kilograms of heroin and other narcotics in Toronto; the estimated street value of the seized narcotics was US$142.5 million. After arriving in Vancouver from China’s Guangdong province, the heroin had been shipped by rail to Toronto. According to an article in the Ottawa Citizen, no link was made to any of the triads at the trial of the apprehended suspects, but the volume of the narcotics in question suggested that a large network was involved. 50 In 2000, the RCMP also seized 99 kilograms of heroin in Vancouver with an estimated street value of approximately US$104m. A Hong Kong resident named Chak Nam Chan was found guilty and sentenced to 14 years in jail. 51 The RCMP Drug Situation in Canada-2000 report notes that the importers of this heroin engaged in criminal enterprises other than drug trafficking while waiting for the price of heroin in Canada to rise to profitable levels. Narcotics dealers in China do not limit themselves to heroin dealing. On April 12, 2001, according to the RCMP Drug Situation in Canada – 2001 report, 48.7 kilograms of Southeast Asian heroin were discovered in two containers of pineapples that arrived in Vancouver. One of the containers was scheduled to be shipped on to Markham, Ontario. The containers were loaded 47 “Canadian Police: Huge Heroin Deals funded From Hong Kong,” Hong Kong South China Sunday Morning Post in English, June 27, 1999 (FBIS Document CPP19990628000046). 48 Lori Culbert, “Poolhall Operator Linked to Heroin Ring: A Vancouver Man Is Among 32 People who Have Been Charged in Connection with Two Cases that Span Several Continents,” The Vancouver Sun June 24, 1999. 49 Royal Canadian Mounted Police, Criminal Intelligence Program. “Drug Situation in Canada – 1999.” (Ottawa 2000). <http://www.rcmp-grc.gc.ca> 50 Shannon Kari, “Mother, 50, Sentenced to 17 Years for Smuggling Heroin, Amphetamines: Son, 22, Confesses to Lesser Charge,” The Ottawa Citizen, June 1, 2002. (LexisNexis Document) 51 Andy Ivens, “14 Years for Trafficker Nabbed in Heroin Bust, “ The Vancouver Province, February 2, 2001. Page 19 Library of Congress – Federal Research Division Asian Criminal and Terrorist Activity in Canada 15 in Hangpu, China. The shipment also contained 250 packets of phenyl acetone, a precursor chemical for the preparation of amphetamine and methamphetamine. 52 In November 2000, The Vancouver Province reported that two couriers employed by a heroin trafficking family living in Canada were sentenced in Hong Kong for laundering $35 million in drug money. Also in custody in Hong Kong is Helen Tan Jian-ping, who lived in Richmond County, British Columbia, and was, according to an Asian organized crime investigator in Ottawa, in charge of running the family’s finances. Vancouver police files indicated that Helen Tan’s husband was wanted in Canada and was believed to be hiding in China. According to the article, the syndicate to which Helen Tan is linked is one of the top 10 groups in the world, with possible links to the Big Circle Boys. The groups routinely used couriers to transport the proceeds of their narcotics sales to Hong Kong for laundering. 53 Breaking the pattern of traditional organized crime groups, the major Chinese crime groups do not seek monopolies on drug trafficking activities or illicit financial transactions. Rather, members, especially those located in mainland China, play their most important role in brokering deals and facilitating the shipment of illegal contraband through Hong Kong to destinations abroad. 54 Trafficking of Women Background Trafficking of persons, both for sexual exploitation and labor, is the fastest growing form of organized crime. It has been increasing dramatically in Canada, aided by the ruling of Human Resources and Development Canada in April 1998, that foreign nationals employed as “exotic dancers” were not displacing Canadian workers. This ruling created a legal avenue that was quickly exploited for illegal activities. 55 Trafficking became illegal only in 2001 after the 52 Royal Canadian Mounted Police, Criminal Intelligence Program. “Drug Situation in Canada – 2001.” (Ottawa 2002). <http://www.rcmp-grc.gc.ca> 53 Fabian Dawson, “Drug Couriers Linked to Vancouver Jail,” The Vancouver Province, November 10, 2002. 54 “Asian Organized Crime,” International Crime Threat Assessment, 2000. <http://www.fas.org/irp/threat/pub45270chap3.html#r14> 55 Susan McClelland, “Inside the Sex Trade: Trafficking in Foreign Prostitutes Is One of the Fastest-Growing Illicit Activities in the World. Welcome to a Hidden Canada—and Lives of Quiet Desperation,” Maclean’s [Toronto], December 3, 2001. (Library of Congress InfoTrac OneFile) Page 20 Library of Congress – Federal Research Division Asian Criminal and Terrorist Activity in Canada 16 passage of the 2001 Immigration Act; prostitution, however, remains legal in Canada. 56 Traffickers subsequently have found ways to exploit the system to provide sexual services. For example, foreign women can enter Canada legally as students, visitors, domestic workers, or mail-order brides. 57 Human traffickers also make use of the Chinese smuggling network, known as “snakeheads,” which often moves aliens into the United States in maritime vessels. Some gangs charge immigrants as much as US$40,000 for passage to the United States. The United States government estimates that 30,000 to 40,000 Chinese were smuggled into the United States in 1999, although reliable estimates of the number of Chinese who enter through Canada are not available through open-source materials. 58 Canadian officials currently estimate that more than 50 immigrant-smuggling groups are in Toronto alone. 59 Human smuggling operations in Canada, whether confined to that country or intending to transport persons to the United States, are as varied as other illicit activities conducted by Asian organized crime groups. They may involve significant resources and the assistance of a well- established triad such as 14K, or they may be the work of a few individuals with no connections to well-known organized crime groups but having the proper connections to engage in human trafficking. Generally, trafficking networks reportedly are loose alliances among various groups that join forces to take advantage of existing opportunities. The success of the business is the primary motivating factor, and the triads do not hold a monopoly on the industry. 60 The trafficking enterprises, however, usually are well structured. Responsibilities such as recruitment, document forgery, transport, and employment are subcontracted out. 61 For example, a woman in one of the countries typically involved in trafficking may respond to an advertisement for a seemingly legitimate job, only to be deceived into agreeing to be transported 56 United States Department of State, Country Reports on Human Rights Practices, 2002 (Washington: 2001). <http://www.state.gov> 57 Lynn McDonald, Migrant Sex Workers from Eastern Europe and the Former Soviet Union: The Canadian Case (Toronto: Center for Applied Social Research, University of Toronto), November 2000. <http://www.swc- cfc.gc.ca/pubs/0662653351/index_e.html> and United States Department of State. Country Reports on Human Rights Practices, 2001 (Washington: 2001). <http://www.state.gov> 58 “Asian Organized Crime,” International Crime Threat Assessment, 2000. <http://www.fas.org/irp/threat/pub45270chap2.html#r14> 59 Susan Martin, “Dreams Ending in Nightmares,” Newsday, March 11, 2001. 60 Amy O’Neill Richard, International Trafficking in Women to the United States: A Contemporary Manifestation of Slavery and Organized Crime (Center for the Study of Intelligence), November 1999: 13. 61 Ibid. Page 21 Library of Congress – Federal Research Division Asian Criminal and Terrorist Activity in Canada 17 to Canada. 62 The groups engaged in trafficking often are involved in other related criminal activities. 63 INS raids on brothels operating in Toronto have uncovered the involvement of groups trafficking in heroin and counterfeiting. To date, it is unclear whether the more organized crime syndicates are the predominant traffickers of Asian women to the United States, although it is believed that they are not. 64 The coercive tactics of trafficking groups continue to make themselves apparent. Women, often deceived or enticed with false promises to travel abroad and be employed in legitimate enterprises, may have their travel documents taken from them upon arrival in Canada. They also may be threatened, raped, or beaten if they protest their treatment. Another practice is to simply kidnap women off the streets of their home towns. Asian organized crime groups engaged in trafficking routinely make use of Asian street gangs as the muscle behind their operations, employing them as guards of the crime groups’ “prisoners.” 65 Asian organized crime groups use a number of approaches to facilitate their trafficking operations. For example, they make frequent use of fake travel documents, often by recycling previously valid passports with legitimate visas and then making the necessary alterations by incorporating the recruit’s picture, or trying to pass off the recruit as the person represented by the travel documents. As a way of saving money, they also have used Asian travel agencies that fail to verify all their visa applications. 66 Asian organized crime groups also use the technique of having a person, known as a “jockey,” accompany a woman on a flight from Asia in order to lend legitimacy to her travel. 67 Still another common practice is for passengers on a flight destined for Canada to leave the airport and miss the remaining part of their flight when making a stopover in the United States. Canada’s visa waiver program, unlike that of the United States, includes women originating in South Korea, providing a useful loophole. 68 Profits from trafficking of women are remarkably high. Smugglers may receive between US$5,000 and US$15,000 for every person successfully smuggled into the United States, be that 62 McClelland. 63 Richard, 1. 64 Lora Jo Woo, Asian American Women: Issues, Concerns, and Responsive Human and Civil Rights Advocacy (New York: Ford Foundation), 2002. <http://www.fordfound.org/publications/recent_articles/asian_american_women.cfm> 65 Congressional Research Service, CRS Report for Congress. Trafficking in Women and Children: The U.S. and International Response, March 18, 2002. <http://fpc.state.gov/documents/organization/9107.pdf> 66 Richard, 7. 67 Richard, 8. 68 Richard, 7. Page 22 Library of Congress – Federal Research Division Asian Criminal and Terrorist Activity in Canada 18 person a woman or a minor. This fee includes payment for travel documents, the recruiting agents, and payment for the use of a “jockey” if one was used. Trafficked women subsequently are required to pay back their debt to the brothel in which they work; often the debt is as much as US$50,000. Chinese trafficking groups in Malaysia reportedly receive US$5,000 to US$7,000 for each Malaysian woman successfully delivered to the United States. 69 This industry may provide annual revenues of several million dollars to smugglers. In the past, the Canadian system was unsuccessful in providing a real deterrence to those individuals or groups engaged in trafficking of persons. In many cases, the Criminal Code did not provide for harsh jail sentences for traffickers, and fines were often the only punishment available. Considering that the sex trade is so lucrative, most traffickers were willing to take the risk. In 2000, the federal government amended the Immigration Act to include fines up to CDN$1,000,000 and the possibility of life imprisonment for someone convicted of trafficking activities. 70 The control that traffickers exercise over the persons they traffic also mitigates against effective deterrence. In Canada, trafficked women are generally required to testify against their employers in order for the latter to be convicted. However, cooperation with Canadian or U.S. authorities may expose the individuals or their families to great harm at the hands of the organized crime group in their native country. Because victims fear such reprisal, and hence refuse to testify, many criminals have been successful at avoiding jail time. This type of case was documented in October 2001 when law enforcement uncovered a prostitution ring that was transporting women from Malaysia to Vancouver. After their arrest, none of the eleven women involved would testify against their employers. 71 Trafficking Operations Between 1999 and 2002 In February 2001, a raid of 20 brothels in San Francisco and Los Angeles uncovered a sex slave ring run by Asian organized crime gangs. According to Matthew Jacobs of the United States Attorney’s Office, the investigation began in Toronto, which is believed to have been the transit point between Malaysia, Thailand, and Laos, and the eventual sale and transferal of women to brothels in California, using fake documents. Investigators determined that a number 69 Richard, 20. 70 McClelland, 4. 71 McClelland, 4. Page 23 Library of Congress – Federal Research Division Asian Criminal and Terrorist Activity in Canada 19 of the prostitutes detained had been arrested in September 1997 during RCMP raids of Canadian brothels. It is believed that many of the women were transferred regularly to different brothels around the United States and Canada as a way to avoid detection and bring customers new women. 72 In March 2001, the RCMP infiltrated a prostitution ring estimated to have earned millions of dollars in illicit profits. Based in Ontario, the ring had succeeded in smuggling around 280 Korean women to Michigan on boats via the St. Clair River in Sarnia in just over a four-month period. Smuggling rings often use the St. Clair River for transport of illegal migrants as well. From Michigan, the women were moved to various locations, including massage parlors in various American cities, such as New York and Los Angeles. Investigators estimated that this ring, which had been in operation since the early 1990s, had moved as many as 1,200 Korean and Chinese women and immigrants who had been smuggled into the United States in 2000. Many of the women were under the age of 20. 73 Financial Crimes Major financial crimes tied to Chinese organized crime groups include credit card forgery, software technology piracy, and other high-tech crimes. The groups also pursue more traditional crimes such as vehicle theft, money laundering, and gun running. The Organized Crime Agency of British Columbia (OCABC) has singled out Asian organized crime groups as leaders in the counterfeit credit card business throughout North America. The Lower Mainland of British Columbia has experienced a disproportional outbreak of these crimes. 74 Since 1999, credit card fraud has remained at extremely high levels in Canada, although there has been a recent decline. According to the CISC 2001 report, the total loss figure in 1999 was CDN$226.7 million and in 2000 it was CDN$172.5 million. In 1999, the value of forged credit card activity was CDN$123.6m; in 2000 it was CDN$81.1m; and in 2001 it was CDN$182.7m. The CISC report obtains its data from the Payment Card Partners, which represents the collective interests of Visa International, MasterCard, and American Express in 72 Tom Godfrey, “Hookers Pipeline Through Canada to the U.S.,” The Toronto Sun, February 17, 2001. 73 McClelland, 3. 74 Organized Crime Agency of British Columbia. Annual Report – 2001. < http://www.ocabc.org/> Page 24 Library of Congress – Federal Research Division Asian Criminal and Terrorist Activity in Canada 20 Canada. Asian organized crime groups have worked with East European, East Indian, and Nigerian-based organized crime groups in this counterfeit card industry. 75 Although South America and Mexico are emerging as centers for producing counterfeit credit cards in the Western Hemisphere, ethnic Chinese crime groups with operations in major commercial centers in East Asia, particularly Hong Kong and North America, are most often identified with fraudulent credit card activity. In 1999, police raided a counterfeit credit card manufacturing syndicate in southern China; the raid resulted in the seizure of thousands of fraudulent cards, uncut blank credit cards, magnetic strips, issuer holograms, encoders, laptop computers, and extensive manufacturing equipment. Investigations revealed that the scheme stretched to Hong Kong, Macau, Taiwan, Bangkok, Canada, Honolulu, and Buffalo, N.Y. 76 On January 12, 2001, Canadian authorities uncovered one of the largest counterfeit credit card operations in Canadian history. Police located an “entire operational credit card factory,” which had been in operation in Vancouver residences since 1994, and had the potential for fraud estimated at over CDN$200 million dollars. 77 Surplus counterfeiting equipment located at the “factory” would have potentially produced over CDN$1 billion worth of counterfeit credit cards. Authorities determined that equipment for the factory had been brought in from California, and that information “skimmed” from legitimate credit cards was being transferred to Vancouver by fax and subsequently sold to the counterfeit credit card factory. Twelve people with connections to the Big Circle Boys subsequently were charged with multiple offenses. The technique of skimming has become widespread in recent years. 78 Asian organized crime groups in Calgary and elsewhere in Alberta also are involved in the production and distribution of counterfeit credit cards via networks throughout North America. In early 2002, a 15-month operation disrupted a huge Asian-based counterfeit credit card ring with connections in 34 countries. Eight counterfeit card factories were identified in Toronto, Calgary, Edmonton, and Vancouver. Authorities determined that the Big Circle Boys 75 Criminal Intelligence Service Canada, Annual Report on Organized Crime Canada (Ottawa: 2002). <http://www.cics.gc.ca> 76 “Asian Organized Crime,” International Crime Threat Assessment, 2000. <http://www.fas.org/irp/threat/pub45270index.html> 77 Organized Crime Agency of British Columbia. Press Release, 1.5 Million Dollars in Counterfeit Credit Cards Recovered, January 25, 2001. <http://www.ocabc.org/> 78 “Twelve People Charged in Major Fake Credit Card, Drug Smuggling Ring,” Canadian Press Newswire, July 3, 2002. (LexisNexis Document) Page 25 Library of Congress – Federal Research Division Asian Criminal and Terrorist Activity in Canada 21 was involved in the Toronto portion of the operation. 79 A December 2002 article in The Vancouver Sun describes the police crackdown on an international crime ring that operated three credit card factories in the Lower Mainland of British Columbia for upwards of 10 years. The group had enough material in the factories to commit over CDN$200 million in fraud. Electronic data were stolen from legitimate credit cards at 116 retail outlets in North America. Fake cards then were sold around the world for between CDN$400 and CDN$800 each. The crime ring solicited the help of employees in gas stations, retail outfits, and restaurants, paying CDN$20 to CDN$40 for each card they scanned unnoticed by the cardholders, in palm-sized scanners. The supposed mastermind of the operation was Peter Liu, a Canadian citizen born in China. Reportedly, evidence established a connection between the Vancouver base of the crime ring and a member of the Big Circle Boys, who was sentenced in October 2002 for trafficking in counterfeit credit cards. 80 Large-scale manufacture and distribution of pirated software, CDs, and DVDs are also common financial crimes that continue to affect U.S. businesses. In January 2002, the largest seizure of counterfeit DVDs in Canadian history took place in Vancouver. Police seized 6,700 DVDs at two locations in Chinatown. The estimated value of the items seized was approximately CDN$125,000. The DVDs were manufactured in Asia and then shipped to North America for sale. 81 Chinese Organized Crime Groups Operating in Canada Big Circle Boys The Big Circle Boys had its origins in Guangzhou, the capital of Guangdong province, in the late 1960s. Its presence was detected in Canada in the late 1980s, and by the early 1990s it had established criminal cells throughout Canada where it has come to dominate the heroin trade within the country. Although not a traditional triad group, Big Circle includes substantial numbers of triad members and has secret membership rites. 82 The gang has cells active 79 “Police Say Calgary Headquarters of Counterfeit Credit Card Operation, Canadian Press Newswire, January 31, 2002. (LexisNexis Document) 80 Linda Slobodian, “Card Fraudsters Ripping off Banks for 10 Years,” The Vancouver Province, December 13, 2002, A3. (Lexis Nexis Document) 81 “Counterfeit DVD Seizure Sets Record: The 5,000 Fakes Nabbed in Raids on Two Vancouver Stores are Worth as Much as $125,000,” The Vancouver Sun, February 2, 2002. 82 Huston, 108-109. Page 26 Library of Congress – Federal Research Division Asian Criminal and Terrorist Activity in Canada 22 worldwide, especially in Hong Kong and New York, and operates more as a loosely associated group of gangs than a centrally led organization. 83 The gang also makes use of sophisticated technologies such as counterfeiting machines to evade law enforcement investigations and is currently the most active Chinese organized crime group operating in Canada. The Big Circle Boys’ greatest concentration is in Toronto. 84 By the late 1990s, the group had approximately 500 members in Toronto and 250 in Vancouver. 85 Ex-mainland Chinese criminals comprise much of the organization. Following the pattern of most Asian organized crime groups, Big Circle has been known to cooperate with Vietnamese gangs and Laotian, Fukienese, and Taiwanese criminals, as well as non-Asian groups, such as the Italian mafia and the Hells Angels. The group essentially cooperates with any criminal organization able to facilitate its activities. 86 The Big Circle Gang is primarily responsible for much of the exportation of Southeast Asian heroin that enters the United States, although its members also have been involved in the trafficking of other illegal narcotics, including South American cocaine and marijuana produced in Canada. They are known to work especially closely with Vietnamese gangs in drug trafficking. 87 In addition to involvement in the heroin trade and other narcotics, the gang is extensively involved in alien smuggling, prostitution, gaming offenses, vehicle theft and trafficking, and various financial, intellectual property rights, and high-tech crimes. Big Circle has been connected to sex slave rings based in the United States that had apparent links to such activities in Toronto. Big Circle also have been linked to other groups that engaged in the trafficking of women. In regard to credit cards fraud, most open-source information suggests that the gang is responsible for a relatively high percentage of the counterfeit cards used in North America. 88 The group’s members have established cells in New York, Boston, Seattle, San Francisco, and 83 Jennifer Bolz, “Chinese Organized Crime and Illegal Alien Trafficking: Humans as a Commodity, Asian Affairs, an American Review, 22, no. 3 (1995). <http://www.csuohio.edu/polisci/courses/PSC422/Chinesecrime.htm> 84 “Asian Organized Crime,” International Crime Threat Assessment, 2000. <http://www.fas.org/irp/threat/pub45270chap3.html#r14> 85 Mark Heinzl, “Organized Crime Begins Using Canada as a Base for Operations Ranging From Drugs to Car Theft,” Wall Street Journal, July 6, 1998, A12. 86 Bill Wallace, “Chinese Crime Ring Muscles In,” San Francisco Chronicle, December 1, 1997. 87 Nathanson Centre for the Study of Organized Crime and Corruption, “A Quarterly Summary, January to March 2002” [Toronto]. Website: <http://www.yorku.ca/nathanson/> 88 Criminal Intelligence Service Canada. Annual Report on Organized Crime Canada (Ottawa: 2002). <http://www.cics.gc.ca> Page 27 Library of Congress – Federal Research Division Asian Criminal and Terrorist Activity in Canada 23 Los Angeles. The gang was first identified in California in the early 1990s, when investigators uncovered a sophisticated high-tech counterfeit credit card operation supplying hundreds of credit cards. Police in San Francisco believe that the gang also is involved in the bootlegging of microchips and computer software, as well as prostitution and fraud in cooperation with the United Bamboo gang, the Four Seas Triad, and the Wah Ching. 89 In the city of Regina, the capital of the province of Saskatchewan, local individuals with links to the Big Circle Boys in Vancouver have been actively involved in counterfeiting, drug trafficking, and auto theft. 90 United Bamboo Gang The United Bamboo Gang (UBG) was established in Taiwan by ethnic Chinese individuals following World War II, and after the Kuomingtang party fled mainland China to avoid the communist takeover. It is currently the largest Taiwanese-based triad, with an estimated membership of 20,000. The group maintains criminal relationships with less organized gangs, including the Black Dragons, the Vietnamese V-Boys, and Hung Pho. In Canada, the group is believed to be involved in heroin trafficking and alien smuggling, which likely involves the trafficking of women as well. It is believed the gang is active in several U.S. cities, including Chicago, Honolulu, Houston, Miami, Phoenix, and various California cities. The UBG has built up a sophisticated network capable of supplying members with guns, narcotics, and fraudulent identifications. 91 The alleged leader of the UBG is Chang An-lo, who has been one of the most wanted men in Taiwan for the past four years. He lives in China, apparently without fear of being extradited to Taiwan. It has been suggested that Chang might have government support because he advocates reunification of China and Taiwan. Chinese authorities, however, have claimed that they merely lack the evidence to prosecute him. 92 Another official has said that the issue is one of guanxia, meaning that Chang has connections with authorities in China who guarantee his safety. Chang’s connections in China have raised the issue of possible collusion between organized crime figures and the Communist Party. The investigation of several high-ranking 89 Wallace. 90 Criminal Intelligence Service Canada. Annual Report on Organized Crime Canada (Ottawa: 2001). <http://www.cics.gc.ca> 91 Kirsten Lindberg, “Emerging Organized Crime in Chicago,” International Review of Law, Computers & Technology, July 1998. 92 John Pomfret, “Made Man in China Has Gangland Ties, Party Pals,” Seattle Times, January 21, 2001, A16. Page 28 Library of Congress – Federal Research Division Asian Criminal and Terrorist Activity in Canada 24 communist officials in 2000 supports this suggestion. The mayor of Shenyang, a major city in northeastern China, was under investigation because of supposed links with the triads, but his case was subsequently dismissed. Shenyang’s deputy, Ma Xiangdong, however, was arrested on bribery and smuggling charges. 93 14K The 14K, formed after the Second World War by Nationalists fleeing Communist China, is one of the most powerful triad organizations in Hong Kong, with over 30 sub-groups, more than 20,000 members, and a well-dispersed leadership. 94 The triad maintains a chapter in Toronto, and operates from New York and other U.S. cities. 95 Individual chapters operate autonomously. At times, this independence has led to competition and turf wars among chapters. 96 14K is currently the fastest-growing triad in Canada. Prominent members have emigrated from Hong Kong and Macau to Canada. 14K’s global network has allowed it to steal credit card data from all over the world, including the United States and Canada, by installing magnetic recorders in credit card terminals. Criminal investigations have determined that the group has had dealings with other Asian organized crime groups in New York and other U.S. cities. 14K activities appear to be expanding in Japan and Thailand, especially in connection with the trafficking of women into Japan. 97 Credit card forgery is also an expanding and very profitable activity for 14K in Canada and elsewhere. Additional Groups Several other Chinese triads and gangs are involved in criminal activities that affect both U.S. and Canadian interests. Open-source information provides little relevant data on these individual groups, however. 93 Ibid. 94 John Arquilla, In Athena’s Camp: Preparing for Conflict in the Information Age, RAND, MR-880-OSD/RGI, 1997: 324. 95 August Gribbin, “Global Crime Syndicates Target U.S. From Canada,” Insights on the News, February 19, 2001. 96 Arquilla, 324. 97 The Protection Project. A Human Rights Report on Trafficking of Persons, Especially Women and Children (Washington, D.C.: 2002). < http://www.protectionproject.org/> Page 29 Library of Congress – Federal Research Division Asian Criminal and Terrorist Activity in Canada 25 Kung Lok The Kung Lok triad was founded in Toronto by Lau Wing Kui and has approximately 450 members in Canada as well as a number of connections in the United States. 98 According to a March 2000 article in the Manila Standard, the RCMP has identified Stanley Ho, a Macau gambling tycoon active in Canada and linked to several illegal activities, as having links to Kung Lok. 99 A man identified as Sonny Kwan, an associate of a former Kung Lok leader, was one of three men arrested in December 2002 following the kidnapping of a daughter of a Hong Kong businessman and her boyfriend. 100 Sun Yee On Members of the Sun Yee On triad have settled in Toronto, Edmonton, and Vancouver, although they are active in Alberta and British Columbia as well. 101 They are involved in the trafficking of heroin and methamphetamines, as well as alien smuggling, credit card fraud, and trafficking of women to the United States. The triad appears to have ties to New York’s Tung On gang. 102 Evidence suggests that Sun Yee On is involved with independent smuggling operations to traffic women and is becoming increasingly active in Japan in the furtherance of this activity. 103 Members of the triad exhibit a strong group identity, exhibit great caution in admitting new members, and adhere to a relatively strict command and control structure in comparison to other triads. 104 Wah Ching Gang The Wah Ching Gang, which originated in California, has engaged in the smuggling and trafficking of Asian women; it is also is involved in gambling, robbery, murder, drug trafficking, and loan sharking. The gang has connections to other Asian organized crime groups in Boston, 98 Bolz. 99 “PNP Hit for Slow Probe of Ho,” Manila Standard [Manila], March 22, 2000. (Lexis Nexis document) 100 Rob Lamberti, “Accused Linked to Asian Gangster,” The Toronto Sun, January 1, 2003. 101 “Asian Organized Crime,” International Crime Threat Assessment, 2000. <http://www.fas.org/> 102 Ibid. 103 The Protection Project. A Human Rights Report on Trafficking of Persons, Especially Women and Children (Washington, D.C.: 2002). < http://www.protectionproject.org/> 104 “Asian Organized Crime,” International Crime Threat Assessment, 2000. <http://www.fas.org/> Page 30 Library of Congress – Federal Research Division Asian Criminal and Terrorist Activity in Canada 26 Dallas, Los Angeles, New York City, Seattle, Toronto, and Vancouver. The Wah Ching is known to employ Asian street gangs such as the Black Dragons and Koolboyz for protection at brothels. 105 Wo Group The Wo Group has 10 sub-groups and approximately 20,000 members worldwide. 106 Little specific information is available on the Wo Group’s activities in the United States and Canada. It is known, however, that the Wo Hop To sub-group is involved in both heroin trafficking and alien smuggling in the United States. The leader of the Wo Hop To is Peter Chong; it is believed that the group has undergone significant expansion on the West Coast, and in San Francisco in particular. 107 Vietnamese-Based Criminal Groups Vietnamese criminal groups range from street gangs engaged in drug trafficking to highly sophisticated groups. The groups are known to be very violent, and some members are reported to have been trained in the use of weapons and explosives. The groups are expanding in the area of high technology crimes and have engaged in the theft of computer parts, which they sell on the black market to third world countries. Vietnamese groups also are believed to be involved in the trafficking of women. Vietnamese groups, especially the street gangs, are generally less formal in structure than many other organized crime groups. This lack of organization often has meant that they are extremely mobile and able to cooperate with other organizations. Quite often, Vietnamese groups lack ties to any one community and, therefore, may travel to various cities to set up temporary operations. These networking activities have led to fear that they eventually will organize into more formal and structured groups. 108 Vietnamese organized crime groups also are known to work with the Hells Angels, mainly in British Columbia, for the large-scale cultivation and exportation of marijuana. These activities have been expanding eastward across Canada to Ontario. It is estimated that there are 105 Richard, 14. 106 Bolz. 107 Nikos Passas, Transnational Crime (Dartmouth: Ashgate, 1999), 82. 108 Lindberg. Page 31 Library of Congress – Federal Research Division Asian Criminal and Terrorist Activity in Canada 27 approximately 15,000 to 20,000 marijuana-growing operations in the Lower Mainland with an estimated sale value of CDN$6 billion. 109 Current estimates in British Columbia are that Vietnamese crime groups, in concert with their Hells Angels counterparts, control roughly 85 percent of marijuana production and distribution in the region. 110 CISC reports that Chinese organized crime groups have purchased marijuana from Vietnamese groups with the intent of transporting it to the United States for sale. In January 2000, the Vancouver Police Department Gang Crime Unit of the Organized Crime Agency of British Columbia (OCABC) began an investigation known as Project Coconut regarding the involvement of members of the Big Circle Boys in a major counterfeit credit card fraud scheme. 111 Upon investigation, police discovered that the suspects also were allegedly smuggling significant amounts of marijuana into the state of Washington by boat from a marina on Vancouver Island. In this particular operation, Vietnamese marijuana producers were providing marijuana to Chinese exporters, who then arranged for transport by ship and delivery to distributors in Bellingham and Seattle, WA. Interdiction efforts resulted in the interception and seizure of shipments totaling approximately 555 pounds of marijuana. 112 Interdiction efforts in January, February, and June 2001 by OCABC in Vancouver and Richmond again resulted in significant seizures. In the raids, police seized 825 pounds of British Columbia marijuana valued at approximately US$2m, 3,000 ecstasy pills, and U.S. and Canadian currency valued at approximately CDN$300,000. 113 In another raid, using information obtained from the Project Coconut investigation, Canadian Customs Inspectors at the Pacific Highway commercial truck border crossing seized 49.5 kilos of cocaine and a large sum of U.S. cash that had been hidden in the sleeping compartment of a tractor-trailer entering Canada. 114 In January 2002, police across Canada initiated Operation Green Sweep, a cross-country crackdown on hydroponics labs used for the cultivation of marijuana plants. The operation resulted in the seizure of 47,000 plants estimated to be worth approximately CDN$47 million. 109 Criminal Intelligence Service Canada. Annual Report on Organized Crime Canada ( Ottawa: 2002). <http://www.cics.gc.ca> 110 Ibid. 111 Organized Crime Agency of British Columbia, Press Release, Counterfeiting of Credit Cards and the Smuggling of Hundreds of Pounds of Marijuana into the United States Halted, July 3, 2002. <http://www.ocabc.org/> 112 Ibid. 113 Ibid. 114 Ibid. Page 32 Library of Congress – Federal Research Division Asian Criminal and Terrorist Activity in Canada 28 One hundred thirty-six people, mostly of Vietnamese origin, were arrested in connection with the operation. The majority of the seizures took place in Ontario. 115 According to a CISC report, Vietnamese groups control approximately 80 to 85 percent of the heroin trade in the Kamloops area of British Columbia. Vancouver also is used as a trans- shipment center for trafficking heroin into the United States, and is reported to have approximately 10,000 marijuana growing operations. Vietnamese gangs are reputed to be controlling much of this activity. 116 Vietnamese crime groups import heroin directly from the Golden Triangle region, almost always through Vietnam or China. Typically, couriers bring in body packs that contain less than five kilograms per person per trip. 117 The West Coast Players The Immigration and Naturalization Service has discovered a Canadian group in Canada, called the West Coast Players that has ties to Asian organized crime groups in British Columbia. 118 According to an article in The Vancouver Sun, the group recruits underage girls in the Lower Mainland of British Columbia and traffics them to the United States, and Los Angeles in particular, to work as prostitutes. 119 The group supposedly is also active in the city of Coquitlam, British Columbia.