Crime kingpin or businessman? h
Police say illegal gambling collected $10,000 a day
“THEY THINK I’M A GODFATHER, THEY THINK I’M A MAFIA, THEY THINK I’M A DRUG DEALER.”
is business card dubs Dung Kien Luong “manager” of Leung Ky Meat and Seafood, but authorities allege he is much more than an employee of the Forest Lawn butcher shop.
“They think I’m a godfather, they think I’m a Mafia, they think I’m a drug dealer,” Luong says during a recent interview at the store.
Luong, 47, vehemently denies he’s any of those things, saying he spends most days here carrying out a legitimate business selling wholesale and retail meats.
“I’ve been 30 years working my ass off,” he says. “In my life, I don’t have a criminal record. I don’t know why they investigate me.”
At the small business on 31st Street S.E., meat cutters whirr in the background and the distinct odour of offal hangs in the air, but police say the butcher shop is one of several fronts Luong has allegedly used to hide a fortune earned from crime.
On paper, Luong’s older sister, Mai, owns the shop with one of her sons. Dur- ing a recent visit, Mai is the one manning the meat counter in a white butcher’s coat.
Investigators, however, claim the shop belongs to Luong, and allege the office in the back was one of the places where he oversaw the day-to-day business of wholesaling marijuana and running an illegal bookmaking operation that accepted more than $10,000 in bets a day.
The spoils from those criminal businesses have allegedly been used over the years to buy, among other things, a million-dollar house in Chestermere and a small fleet of luxury vehicles.
The allegations against Luong haven’t been proven in court, but documents obtained by the Herald illustrate the lengths authorities have gone to make their case.
For more than two years, police intercepted conversations through wiretapped phone lines and listening devices planted in the butcher shop and inside Luong’s home — where investigators also rummaged through the trash to find discarded betting records.
Armed with the evidence they covertly gathered, police obtained several search warrants, which they used to raid the butcher shop, Luong’s home and nine other Calgary-area locations on Dec. 7. 2010.
Although court documents identify Luong as the investigation’s main target, police also allege his sister Mai, 51, and brother Bao, 48, have helped him launder money and conceal assets.
Police also searched Bao and Mai’s homes, which are side-by-side in the northeast Calgary neighbourhood of Monterey Park.
The next day, the RCMP took the wraps off the investigation — codenamedProjectKwadrant—announcing they had seized seven high-end vehicles and obtained court orders restraining a Forest Lawn shopping centre, four homes and two bank accounts. Police allege the restrained properties and the vehicles (two Lamborghinis, two Porsches, a BMW, a Hummer and a classic Ford Mustang) were obtained through crime or used in illegal activities. The court orders prevent the assets from being sold or transferred and are an interim step toward applying to have them permanently forfeited to the Crown.
At the time, police said the probe targeted “top level players” in a “sophisticated criminal operation,” but didn’t name them because no charges had been laid.
Four months later, Luong remains free and working at the butcher shop along with another man implicated by police: Paul Wong, the meat company’s bookkeeper.
The pair readily invite a visitor into their office, where they sit kittycorner behind aging desks.
It’s nondescript for an alleged crime den, with little more than a clock and a calendar adorning the faded yellow walls.
The allegations have been bad for the meat business, Wong laments.
“People got scared,” he says. “They don’t want to deal with us.”
Luong says authorities have cast a pall of suspicion over his family and their businesses — enterprises he says were built honestly with money inherited from their parents, who brought them to Canada from Vietnam in the early 1980s.
“That’s where the money came from: they worked hard for 30 years,” he says.
And yet, Luong adds, police haven’t laid any charges after more than two years of investigation.
“It’s nothing. They cannot charge me,” he says.
Police aren’t disclosing much about their case right now, but a senior officer says the investigation — which involves the RCMP, Calgary police, the Canada Revenue Agency and federal prosecutors — is far from finished.
“Due to the complexity of the in- vestigation, there are a number of investigative steps to be taken before it can go to charge,” says RCMP Insp. Wendell Reimer of the integrated proceeds of crime unit.
“It is anticipated we will be in a better position to comment further on the investigation and charges by this fall.”
While investigators have been reluctant to discuss the evidence against Luong and his associates, a 254-page search warrant application obtained by the Herald lays out their case in detail.
Between 2003 and 2007, Luong filed federal income tax returns claiming an average annual income of $23,000. Yet police allege he owns the Little Saigon Centre on 17th Avenue S.E., a house in Chestermere bought for $845,000 in 2009, the butcher shop, a garden supply store in northeast Calgary and several luxury vehicles.
Although registry documents list members of Luong’s family as owners, police allege a common method of concealing wealth from authorities is finding “nominee” buyers: people who agree to pose as the property holder.
Luong says he once owned shares of the butcher shop and a portion of the mall — which he and a group of family members bought for $2.4 million in 2004 — but says a costly divorce forced him to sell his interests in both.
Official records no longer name Luong as a director of the meat business. A numbered company controlled by Bao and Luong’s sister-in-law (Bao’s wife) is listed as the mall’s current owner.
The Little Saigon Centre on 17th Avenue S.E. is an eclectic mix of independent and family-owned businesses such as restaurants, specialty grocery stores and doctors’ offices.
The shopping centre was the subject of a Herald article in 2005, when Bao donated space to a charity that repaired wheelchairs and sent them to Vietnam.
Now, Bao says the publicity resulting from last December’s raid and the restraining order are scaring people away.
“Some customers think the mall was closed by police. Now my tenants suffer,” he says.
Bao is also the owner listed on the title of the Chestermere house, which he says he is renting to his brother while renovating it.
Legitimate real estate investments allowed him to buy the Chestermere house after it was put up for auction, says Bao. “It’s money from equity,” he says, adding he wants to move his family into the Chestermere house once it’s renovated.
Police say otherwise, alleging their wiretaps caught Luong and others claiming he owns the house, the butcher shop, garden supply store and the mall.
Publicly, however, Luong says child support payments of $1,500 keep him on a short financial leash and he needs “help” from family members to keep afloat after maxing out sources of credit.
Reaching into a desk drawer, he produces bank statements that showed $125,000 and $164,000 borrowed on separate lines of credit between 2007 and 2009.
Yet Luong acknowledges he spent more than $106,000 US in cash to buy a 1992 Lamborghini Diablo from an American auto dealer in 2008. Police spotted a copy of the invoice in Luong’s house last June after obtaining a warrant authorizing a covert “sneak and peek” search of the residence.
Luong doesn’t deny the purchase, saying he gets disposable income from playing baccarat at casinos.
“I try as much as I can to win my money from the casino,” he says.
Pulling more documents from his desk, Luong shows an account statement from the MGM Grand Casino in Las Vegas that shows a large portion of winnings he estimated at $180,000 over the years — just at that establishment.
Luong offers to produce more receipts showing similar winnings from other Vegas casinos like the Bellagio and Venetian, as well as the Stampede Casino here in Calgary.
When it’s suggested he must be a highly-skilled baccarat player to win that kind of money, Luong demurs. “Oh, maybe,” he says, shrugging. Back in December, police said they launched their investigation after noticing large amounts of cash moving through an unnamed local casino.
Federal law requires any cash transactions over $10,000 to be reported to federal authorities, which then look for any evidence the money is connected to illegal activity. A federal intelligence report done for local police showed Luong bought $712,807 in casino chips with cash between 2005 and 2008.
While Luong may spend — and possibly win — large amounts of cash at licensed casinos, police allege he earns money illegally by selling marijuana and running a bustling bookmaking operation that accepts $10,000 or more in bets a day.
Investigators analyzed financial records of the butcher shop and Smart Grow Inc. (the garden supply store that police also allege is owned by Luong) and found the businesses had combined cash deposits of more than $3 million between 2003 and 2008 — but no withdrawals.
Despite such large revenues, investigators who covertly entered Smart Grow on two occasions observed hardly any merchandise had been sold during the six-week interval between the court-approved searches.
“Inventory counted that was observed on March 30, 2009, still appeared dusty on the shelves on May 19,” RCMP Cpl. Travis Pereira wrote in last December’s search warrant application.
“There was no pricing on the product or the shelves for customers to know the cost of the items.”
Most of the cash deposited by Leung Ky Meat and Smart Grow was in $20 bills — another red flag for investigators.
“Based on my experience with previous drug investigations and the seizure of cash as proceeds of crime, I have found the most common denomination for drug traffickers is the $20 bill,” wrote Pereira.
During the investigation, police observed at least two drug transactions allegedly involving Luong and the bookkeeper, Wong. Investigators allege Luong was a wholesale trafficker who bought marijuana from growers for approximately $1,000 a pound, and then sold it to streetlevel dealers for a profit.
In a transcript of one intercepted phone call, Wong said he is selling “shirts” and asked Luong if he knows anyone who wants them.
“Luong asked Wong to bring one over to see if it fits,” according to the police recording.
The next day, plainclothes police officers photographed Wong arriving at the butcher shop with a white plastic bag. According to the officers’ notes, Wong left 30 minutes later, empty-handed.
Within five minutes, the officers observed two men arriving at the store. Police evidence photos show the men leaving the store with a box labelled “Maple Leaf Meats.” Police followed the men for about an hour before pulling over their van for a seatbelt violation.
The officers said they smelled marijuana and found 250 grams of marijuana inside a white plastic bag hidden in the meat package during a subsequent search.
“Based on my participation and observations, I believe that Luong has knowledge of and is actively involved in the trafficking of marihuana (sic). Luong had a discussion with Wong in which he stated that he could help Wong dispose of some product, and a couple days later, Wong was observed transporting a bag of marihuana (sic) to Luong,” Pereira wrote in the affidavit.
Luong and Wong deny supplying the man with marijuana. Luong claims the man was a contractor hired to do renovations at the house in Chestermere who stopped by the butcher shop to talk and says he doesn’t know where the marijuana came from.
“There’s nothing going on here. I don’t have drugs in here,” he says.
Having already said he’s an avid casino-goer, Luong readily offers that he also bets on sporting events through an online gaming site — but denies running an illegal bookmaking operation.
Luong says he simply placed bets with the online site on behalf of other gamblers, because he’s well-known in the community and has an existing account.
“They can find where I am, because I’m a business person,” he says, adding the site pays him a five per cent commission for the referrals.
Police, however, allege Luong spent hours every day setting odds for various sporting events and relaying them to at least two agents working for him. Although the agents could accept bets directly from gamblers, police allege they usually communicated the odds to so-called “sheetwriters,” whose job was to take wagers and pass the information back up the chain.
“These ‘sheetwriters’ are isolated from any knowledge of who Luong is, as each tier in the organization is isolated from anyone who is directly above or below them,” according to the police affidavit.
“All levels below Luong only take a percentage ‘commission’ of the betting action (total money bet for a day); after the gamers are paid Luong takes the profit.”
Police allege one of the agents relayed betting information to Luong by fax. Between April 2009 and April 2010, police say they searched garbage placed outside the Chestermere house and Luong’s previous residence in Applewood and found more than 1,000 sheets allegedly containing gambling information in the trash.
During a three-week period in December 2009, investigators tallied nearly $230,000 in bets from that agent, who allegedly employed a sheetwriter who accepted bets at a Vietnamese restaurant in Forest Lawn.
Police estimated bets from that agent alone averaged between $10,000 and $15,000 a day — at its slowest.
“Betting in the fall can be up to 10 times higher than the bets accepted in the spring as a direct result of increased betting on NFL games,” the police affidavit said.
A second agent, meanwhile, allegedly relayed bettors’ information to Luong via hundreds of text messages intercepted by police.
Bao maintains police have scapegoated his family as a way of justifying their increasing budget demands from different levels of government.
The allegations have been damning — but remain untested in court, Bao says. He’s confident his family will be vindicated.
“Time will tell,” he says.