By Greg Stejskal
ticklethewire.com
Last week in Jupiter, Florida, the Orchids of Asia Day Spa was raided and closed allegedly for being a prostitution business, a brothel. Making it a prominent story on national news was the identity of one of the spa customers, Robert Kraft, the billionaire owner of the New England Patriots. Kraft has been charged with soliciting prostitution.
Surprising to me was the reaction of law enforcement and the media. It reminded me of that iconic scene from the movie, “Casablanca:”
The local police chief, Captain Louis Renault (Claude Rains) is closing Rick’s American Café. When asked why he’s closing the Café, Renault replies. “I am shocked – shocked – to find that gambling (think prostitution) is going on here!” After delivering that line, the croupier hands Renault a stack of bills and says, “Your winnings sir.” Renault thanks the croupier and quickly walks away.
I find it hard to believe that the media and law enforcement like Capt. Renault didn’t know that many storefront Asian spas/massage parlors are in fact brothels. The story that follows was posted in 2009 on the federal law enforcement website, ticklethewire.com.
In 1999, the Ann Arbor (MI) Police Department came to me with a proposal. AAPD wanted to know if the FBI would be willing to help investigate Asian spas/massage parlors in Ann Arbor, and prosecute them federally. There were five Asian spas in Ann Arbor, and they strongly suspected that the spas were fronts and were actually brothels. At the time I was the senior agent in the local FBI office and knew next to nothing about Asian spas.
I consulted with US Attorney’s Office (USAO) in the Eastern District of Michigan and FBIHQ. I got the go ahead and learned there were other similar cases being pursued elsewhere in the country. We would coordinate our investigation with those other cases. Further, there were national implications involved, e.g., organized crime, indentured servitude, immigrant smuggling, human trafficking and sexual exploitation which the then US Attorney General had made a priority. The Asian spa/brothel seemed to be a national phenomenon.
I went back to AAPD and told them we could pursue the spas federally, but only if AAPD was willing to commit to a long-term investigation. To AAPD’s credit it made that commitment.
At the outset of the case, we understood the spas could be shut down like the speakeasies of the prohibition era, but to have any lasting impact the owners had to be identified and prosecuted. It was relatively easy to show there was prostitution occurring in these spas, the trick (no pun intended) was to prove the owners had knowledge that prostitution was occurring, and they were profiting from it.
All the spas in Ann Arbor were run by Korean Americans. (We code-named our investigation Seoul Provider.) Surveillance and telephone pen-registers indicated some interaction between spas in Ann Arbor and all over the country. All the spas we became aware of in Michigan and Ohio were run by Korean Americans, and they all had very similar operating procedures.
The working girls were almost exclusively Asian and lived on the premises and seldom left. They moved from one spa to another after six weeks to two months often in other parts of the country. The spas were usually managed by older Asian women, who were in effect madams. Often the spas would have the working girls sign agreements making them independent contractors, thus giving the owners plausible deniability as to knowledge of sexual activity. The working girls were in almost all cases uncooperative with law enforcement and could not be relied upon as potential witnesses. Despite the women being exploited, most had very limited skills, little English language capability and were in an indentured servitude status. Many were told the expenses that were incurred to get them to and into the US was a debt and had to be repaid.
The spas operated seven days a week with very long hours, e.g., 10 AM – 2 AM. (not the kind of hours of operation in legitimate massage parlors and probably a clue). The spas would set fees such as $45 for a half hour and $60 for an hour massage. Generally, these fees went to the house. The money for sex was added to the initial fee and was negotiated based on the agreed sexual activity. The money for sex was split between the house and the girls. All the spas we investigated accepted credit cards. This turned out to be a key element in proving the owners’ knowledge.
The owners would establish merchant accounts to enable them to accept credit cards. Thus, all proceeds from the credit cards went directly to the owner. So, if a customer were to pay initial fee with a credit card and then within 10-15 minutes have a second charge in excess of $100 made on his card, it was obvious what was occurring and difficult for the owner to argue they had no knowledge of sexual activity. (All the credit transaction information was obtained by subpoena.)
This coupled with physical surveillance, which included “trash pulls” (The trash pulls revealed among other things, used condoms and daily business records showing customer charges.) and evidence obtained when we ultimately executed search warrants. This resulted in all the owners being convicted of federal felony charges and over a million dollars of assets being forfeited. The investigation did not ever use undercover police officers soliciting sex acts in the spas which was a standard technique in prostitution cases but wasn’t necessary in our strategy to prosecute the owners and not the working girls.
Most of the charges were based on Interstate Transportation in Aid of Racketeering (ITAR) – Prostitution statute (18USC1952), tax violations and there were immigration statutes that were applicable as some of the owners were not citizens. None of the working women were prosecuted and help was offered to them through local social services.
During the investigation, we identified many of the spa’s customers, “Johns,” they weren’t prosecuted. We did interview some of them as potential witnesses. In the recent Florida case, the authorities are prosecuting the Johns for solicitation of prostitution including Robert Kraft. They obtained evidence of prostitution using surreptitiously placed video cameras.
Although prosecuting Johns may be a deterrent, I think a better long-term solution would be to prosecute the owners/purveyors and institute forfeiture of the assets attributable to the spas. I’m not sure they have the evidence to do that.
To the best of my knowledge there are no Asian spas/massage parlors currently operating in Ann Arbor nor have there been since our investigation concluded.
