10 defendants who operated network of Bay Area brothels indicted on racketeering charges

SAN FRANCISCO — A federal grand jury in San Francisco has indicted 10 defendants for their alleged role in a far-reaching prostitution racketeering enterprise that recruited Asian women to work as prostitutes in approximately 40 brothels located throughout the Bay Area.

The charges, which stem from a probe by U.S. Immigration and Customs Enforcement's (ICE) Homeland Security Investigations (HSI) and the San Mateo Police Department, include racketeering conspiracy; importation of aliens for immoral purposes; money laundering; using interstate commerce to promote prostitution; using a facility in interstate commerce to promote prostitution; and transportation in interstate commerce for prostitution.

According to the indictment, from August 2002 through July 2014 the defendants operated 40 brothels in the Bay Area using apartments rented on short-term leases. As part of the scheme, the defendants allegedly persuaded women, primarily from Asian countries, to work as prostitutes in the brothels. Investigators say the defendants advertised the prostitution services on social networking websites such as MyRedbook.com, Craigslist.org, and Backpage.com. The ads, which included contact information, featured photographs of nude and partially nude women assuming provocative poses. Telephone operators employed by the enterprise directed prospective customers who called the telephone numbers posted on the website ads to a particular brothel. The prostitutes kept approximately two-thirds of their earnings and paid one-third to the enterprise, primarily through Allen Fong, the scheme's alleged ringleader.

The indictment further alleges that, from at least March 4, 2004, through Oct. 3, 2013, the defendants sent numerous wire transfers to Singapore, Thailand, China, Hong Kong, Taiwan, Vietnam and the Philippines to facilitate the prostitution scheme. That included at least 23 wire transfers totaling nearly $180,000 to Leow Wan Ru Veron, a prostitute recruiter based in Singapore. Additionally, Chonthicha Jaemratanasophin, one of the prostitutes charged in the case, funded 20 international wire transfers totaling more than $100,000 to Singapore and Thailand.

Allen Fong, 58, of San Mateo, who allegedly oversaw the scheme, is charged in all 32 counts of the indictment. The other defendants include:

• Ya Huai Hung, 53, a citizen of Taiwan;
• Leow Wan Ru Veron, 53, a citizen of Singapore;
• Robert Chun, 54, of San Francisco;
• Jie Mu, 43, of San Francisco;
• Laurence Shu Kwan Lee, 36, of San Francisco;
• Kevin Hartig, 58, of Daly City;
• Waylen Fong, 70, formerly of San Mateo;
• Angelina Chuong, 39, of San Francisco; and
• Chonthicha Jaemratanasophin, 48, a citizen of Thailand.

Defendants Fong, Chun, Mu, Lee, Hartig, Chuong, and Jaemratanasophin were arrested Thursday and made their initial appearances in federal magistrate court in San Francisco. Jaemratanasophin was detained. The other defendants were released on bonds ranging from $100,000 to $500,000.

The racketeering conspiracy and money laundering violations each carry a maximum penalty of up to 20 years in prison; the charge of importing aliens for immoral purposes and using interstate commerce for prostitution are each punishable by up to 10 years in prison; and use of a facility in interstate commerce to promote prostitution carries a maximum term of five years' imprisonment.

The case is being prosecuted by Assistant U.S. Attorney Deborah R. Douglas, aided by Assistant U.S. Attorney David Countryman, Christine Tian, and Daniel Charlier-Smith.