Jul 22, 2004
Money laundered through Macau casino ended up in Richmond and Vancouver banks
Stanley Ho, the undisputed gambling czar of Macau has friends in high places in virtually every corner of the globe.
In Canada, he has been feted and wooed and given medals by the likes of Jean Chretien, Brian Mulroney and several premiers of British Columbia.
Former U.S. president Bill Clinton, deposed Philippine president Joseph Estrada, ex-British premier Margaret Thatcher and China‘s top dog Jiang Zemin are just some of the names on his rolodex.
The trim billionaire has the ugliest mansion in Vancouver, that is at the entrance of Stanley Park, while his business ventures stretch from coast-to-coast.
Ho, 83, who has three wives and 17 children, is described by his mouthpieces as “a well-respected international entrepreneur.“
But there is a dark side to the casino magnate, one which is secretly recorded in Canadian, American, British and Australian intelligence files.
The intelligence data, which has been vehemently denied by Ho and his friends in high places, state the operations of the gambling king are intricately linked to Asian organized crime.
A RCMP document called the Asian Organized Crime Roster has him listed as Triad leader while a similar American report put Ho on a watchlist.
But all the alleged criminal connections are downplayed and Ho continues to build his global business empire with little hindrance and a lot of influence.
Now, however, an investigation by the Far Eastern Economic Review magazine shows that police suspicions about Ho‘s operations are not too off the mark.
A report by prize-winning writer Barry Wain alleges that Ho‘s multibillion-dollar gaming flagship Sociedad de Tourism e Diversoes de Macau (STDM) is allegedly at the centre of a money-laundering scheme moving billions of dollars out of China through Macau into Hong Kong.
Some of the laundered money has already made its way into B.C. banks and casinos.
Prosecutors in Hong Kong who are handling the Bank of China scandal say US$1.4 million of US$26.5 million allegedly embezzled by a former bank branch manager was illegally moved in the form of an STDM cheque.
The money was allegedly taken by Hui Chiu Fan who with two accomplices entered Canada via Vancouver using false identities.
The trio of fugitive bankers then deposited large amounts into accounts at the Royal Bank Canada branch on Ackroyd Road in Richmond and the Vancouver area branches of the Hongkong Shanghai Banking Corporation and the Canadian Imperial Bank of Commerce.
Hong Kong police said Hui‘s STDM cheque, looked like casino winnings and did not trigger warnings at the banks where he cashed it.
| Inside the casino Lisboa |
As part of their investigation Hong Kong police interviewed a casino manager in Macau, who said the money was handled by a junket operator, a middleman who takes gamblers to so-called VIP rooms. But the manager said he had no records.
Asian organize crime investigators in Vancouver tracking Hui and his accomplices spotted them at a house in Richmond two years ago. The house was once used as a marijuana grow operation. Later they had information that trio were hiding out in an area outside Hollywood in California.
Last April one of the three, Yu Zhendong, 41, was handed over to Chinese authorities on the condition that he not be tortured or put to death. He was arrested in Nevada where some of the alleged money he siphoned was laundered through local casinos. The other two remain at large.
| The Lisboa hotel and casino |
The Review said it sent a team of reporters to Zhuhai, the city directly across the Chinese border from Macau, where they said they had deposited the equivalent of US$12,900 (HK$100,620) with the owner of a stall in a sprawling shopping centre called Frontier Square. About 100 dealers in the centre, the report said, were willing to exchange cash on the spot or transfer it to Macau.
The Review team paid fees totalling US$232 to the stall owner.
“Hours later,“ the story said, “we collected a cheque for the full amount, on production of an identity card, at Ho‘s crown jewel, the Hotel Lisboa, STDM‘s flagship casino and heaquarters in Macau.
“Payable in Hong Kong dollars, the cheque was stamped in Portuguese for and on behalf of Sociedade de Jogos de Macau SA, STDM‘s subsidiary that operates the company‘s 12 casinos.‘‘
The cheque was drawn on the Hong Kong branch of an unnamed European bank and made payable in cash, which means the recipient cannot be easily traced. The cheque was later accepted by another bank in Hong Kong with no questions asked, according to the magazine.
The Hong Kong Standard said under Chinese law, citizens who leave the mainland as tourists or on business can take no more than US$5,800 with them. Yet, the report said, many can be seen wagering tens or even hundreds of thousands of dollars a night at the tables in Macau. Central government officials were quoted as saying billions of dollars a year are smuggled to Hong Kong and Macau.
Chinese who deposit money inside the mainland and collect it in Macau casinos are not required to gamble, according to central government officials. Indeed, the report says, the funds are available for collection in three convenient options – cash for shopping, chips for gambling or a cash cheque for easy transfer to another location, they say.
For the most part, the story said, the system does not involve a physical transfer of currency, but rather an offsetting arrangement such as the one practised by Review reporters.
It quoted Macau-based central government officials tracking the flow of funds using agents and informants working in the casinos and under cover as saying at least US$1 billion of the billions channelled to Macau and Hong Kong every year are sent abroad to North American, Europe and Southeast Asia.
Some of the money, the Review said, is the proceeds of corruption, although officials have no way to calculate how much. Funds sent abroad typically go into property in the US and Canada to pave the way for the emigration of family members, according to Chinese officials and Hong Kong police.
Ho‘s spokeswoman, Janet Wong, declined comment on the money-laundering story.
Ho‘s family, including his daughter, Pansy who had applied to open a casino in Vancouver under the administration of Premier Glen Clark, is also mired in a family feud that is shedding light on some of the casino king‘s operations.
| Winnie Ho |
Winnie Ho, one of Asia‘s most powerful women and Stanley Ho‘s sister, claims that he had forced her to relinquish her stake in the Macau gaming operations and deprived her of hundreds of millions of dollars after she provided the entire startup capital for STDM in 1962.
Documents provided to the Review by Winnie Ho allegedly indicate triad involvement in Ho‘s casinos through VIP rooms, which were originally designed to allow well-heeled gamblers to play in relative privacy and comfort. The VIP rooms, it continues, have proven a boon to both STDM and Macau.
Allegedly, the story continues, a STDM list of loans to VIP rooms in 2001 includes loans from several convicted criminals and many others identified by retired Hong Kong police and central government officials as past or present triad bosses and members or persons with triad links.
The control for the VIP rooms triggered a bloody gang war in Macau, which spilt over into the Lower Mainland. (see Casino connections in the last issue of The Asian Pacific Post)
Documents provided by Winnie Ho also allegedly indicate that STDM has historically functioned at times like a bank, although it is not an authorised financial or credit institution.
Ho has issued a blanket denial of his sister‘s allegations.
The casino czar, while having influential connections worldwide, is no stranger to controversy.
| Pansy Ho |
He has tried several times through his daughters Pansy and Daisy to apply for casino licences in B.C., Alberta and Ontario.
After withdrawing them, for unspecified reasons but following criminal checks, Ho gained entry into the Canadian gaming world by teaming up with a B.C. computer whiz to develop a virtual casino, calledDrHo.com.
DrHo.com is based in Antigua with technology designed by Vancouver-based Eyeball.com Network Inc.
Gamblers play poker, blackjack, roulette and a host of other games in real time with live dealers.
Asian Organized crime sources told The Asian Pacific Post that Ho and his connections are listed in numerous classified intelligence files.
“I am sure that our politicians know about this but he still has unfettered access to them,“ said the source, adding the issue has been raised in the House of Commons.
During another scandal involving him in the Philippines that caused the stock market to crash, Ho took out ads in Manila newspapers to defend himself from allegations that he was linked to organized crime.
Those allegations stemmed from reports in Canadian government files.
In the ads, Ho noted his “substantial investments“ in Los Angeles, San Francisco, Vancouver, Calgary and Toronto.
“I have traveled freely and been welcomed there, including to Vancouver in 1997 when I hosted delegates at my hotel (Sutton Place) in Vancouver for the APECconference, and to the United States when I met with President Clinton,“ he said.
Ho by then was named or listed in several Canadian intelligence databanks including the National Security Register of the Canadian spy agency, CSIS.
In the United States, a report prepared for the Department of Justice by Philip Baridon listed Ho as one of 27 people linked to Asian organized crime who are on an American watchlist. Ho‘s named was removed after his lawyers visited with Department of Justice.
Unlike Canada or the United States, Ho has never been able to make much headway into Australia because of extensive Australian Security Intelligence Organisation reports on his background, connections and links.
Ho does not view the country as a “friendly nation“, according to a Queensland-based China analyst.
Ho failed in his attempts to get a casino licence in Australia.
The New South Wales Gaming Licensing Board (now defunct) has a report on Stanley Ho which is stamped “never to be released.“ Its officials have deemed Ho “an unsuitable person to hold a casino licence”.
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