One of the nation's largest sex-trafficking prosecutions yielded its second indictment Thursday, when federal authorities in Minneapolis announced charges against 21 leaders of a conspiracy that allegedly trafficked hundreds of Thai women throughout the United States.
The new indictment, which grew out of a Minnesota investigation, brings the number of people charged in the "Bangkok Dark Nights" case to 38. Officials hope it will deal a blow to the organization's leaders, who allegedly laundered millions of dollars in illicit proceeds from the scheme.
"Our every intention is to … cripple this organization to a point where they aren't going to be able to reconstitute again," said Alex Khu, special agent in charge of Homeland Security Investigations' local office.
Khu said agents arrested all but one of the new defendants on Wednesday at locations in California, Texas and the Chicago area. During a sweep in Los Angeles, Khu said, agents seized $300,000 in cash and multiple firearms, including an AK-47 rifle.
The probe identified seven Minneapolis-area locations used as houses of prostitution during the conspiracy, which began in 2009, according to federal prosecutors. The group's ringleaders, who are still in Thailand, personally scouted some of the Minnesota locations, through which at least a dozen victims were trafficked, prosecutors said.
Announcing the charges at a news conference in Minneapolis, Acting U.S. Attorney Greg Brooker described the conspiracy as "an elaborate web of criminal activity where the members were making tens of millions of dollars" by exploiting vulnerable women, often from impoverished backgrounds and who spoke little to no English.
The total number of women trafficked by the organization could reach the thousands, authorities said. After being promised a better life in the U.S., the women were forced into working at all hours of the day, up to seven days a week, to pay down "bondage debts" of up to $60,000 apiece.
Like the original indictment, the new charges describe a mafia-like enterprise with members playing multiple roles — from traffickers who owned and sometimes traded victims' bondage debts, to "house bosses" who ran daily operations at houses of prostitution, "facilitators" who fraudulently married some high-level members of the conspiracy to help them gain immigration status, and money launderers who helped keep the business afloat.
MSP airport tip
The case grew from reports of Thai women being flown into the Twin Cities and shuttled between apartments. A Minnesota-based federal agent pursued the tip, and eventually former U.S. Attorney Andrew Luger expanded it to include the alleged leaders around the globe. Departing from his prepared remarks Thursday, Brooker recognized Luger's imprint on the investigation, which included traveling to Thailand alongside Minnesota officials to seek collaboration from officials there.
"It's unfortunate that he cannot stand behind this podium today … but mark my words, this continues to be a top priority of this office: aggressively prosecuting all forms of human trafficking," Brooker said.
The Criminal Division of the Internal Revenue Service also helped investigate, alongside state and law enforcement agencies in the Twin Cities and Chicago areas.
Prosecutors have described the victims as modern-day slaves whose services were advertised online. They weren't allowed to leave the apartments, hotels or spas where they worked unless they had an escort, and some were encouraged to undergo breast augmentation. According to charges, the women were forced to submit to abusive sex buyers and had to service up to 10 or more "Johns" per day.
"At times, customers would be physically and sexually abusive with the victims, including acting out 'rape fantasies,' " the indictment said.
One of the women told authorities she discovered she had been recruited into the sex trade after being taken to a store to buy intimate clothing, according to Panida Rzonca, directing attorney for the Thai Community Development Center in Los Angeles, who spoke at Thursday's announcement. The woman was one of two who received help from Rzonca's office, and both said they were told that they had to pay down massive debts after they reached the U.S.
"I didn't dare say anything because I was afraid of being killed," Rzonca said one woman later told her. "My traffickers are so well-connected and I didn't think I could ever escape."
Massive money laundering
The ring's money launderers have proved to be among the most elusive targets because most had no history of contact with law enforcement, authorities said. According to the charges, the ring dealt largely in cash and used a number of methods to conceal proceeds, including "funnel accounts" opened by victims but controlled by conspirators who controlled the bank accounts.
The group also allegedly smuggled cash in bulk, wired funds and used a "hawala-based system" to transfer money overseas. Under that system, a person is paid in one location and instructs an associate elsewhere to pay the final recipient.
A trial has been scheduled for Oct. 2, with both indictments assigned to Senior U.S. District Judge Donovan Frank.
Three defendants charged in the first indictment — including two Minnesotans — have since pleaded guilty and have agreed to forfeit $39,000 to $75,000 each at sentencing. The two Minnesotans, John Zbaracki and John Ng, admitted to joining the conspiracy after first being customers. They were considered "runners" who drove victims to and from airports and accompanied them to trips to the bank or to buy condoms and lubricant. The men admitted to being paid both in cash and in sex with the women. Another defendant, Andrew Flanigan, admitted last week to marrying a co-defendant who was first trafficked by the organization but eventually rose to the level of "house boss" in Atlanta.
Stephen Montemayor • 612-673-1755
