ICAC Early Classic Cases - Rich Pickings at the Fruit Market

A Corruption Network Dissected

After being convicted of drug offenses, the three key figures of the drug racket - Ah Biu the Mastermind, Ah Hung the Manager and Ah Chu the Assistant - agreed to testify for the ICAC and revealed how they managed to bribe so many law enforcement officers in the district to turn a blind eye to their booming heroin business in and around the Yau Ma Tei Fruit Market.

The three were placed in isolation ward in Siu Lam Prison and were barred from mingling with other inmates. Investigators Tony Lui, Louis Cheung and another colleague were assigned to take witness statements from them.

Note:All names and nicknames given to the defendants and suspects in the story are fictitious. The restaurant and corner store referred to closed long ago.

Bread, Water and Hard Labour

On 10 August 1976, the Police Narcotics Bureau raided 23 locations in Kowloon and the New Territories, arresting seven men and one woman, including Ah Biu at the Tai Loy Restaurant and Ah Hung near the Tai Fat Store. About $20,000 worth of heroin was also seized, along with five accounts books detailing the drug racket’s transactions for the past three months. Other accomplices were netted one after another and charged with drug trafficking.

Ah Biu had thought bribes could buy him immunity from the law - and for some time he appeared to be right. But the raids and arrests began to unravel his corrupt world. Realising the helplessness of his situation, Ah Biu decided after careful consideration to reveal the shocking extent of law enforcement corruption and asked for a meeting with ICAC officers.

Note: All names and nicknames given to the defendants and suspects in the story are fictitious. The restaurant and corner store referred to in the story were closed long ago.

Louis Cheung’s Sound Bite

Life was easier for the prisoners than we ICAC officers during that time. They did all the talking and we were to jot down everything they said. We had to go there every morning. They got meals and fruit every day. We didn't bother to go out for lunch because the journey out and in was so time consuming, not to mention the meticulous security checks we might have to go through. It was really complicated and troublesome. Therefore we could only bring our packed lunch. We wouldn't wish to be seen having a sumptuous meal ... or make the prison staff feel we were making a fuss either ... we only brought a simple lunch - only bread and a bottle of water.

Statements piling up[ to 400-odd pages (Photo from the archive)

Transcription ‘Penance’

Ah Hung was Ah Biu’s right-hand man responsible for negotiating the amount of “squeeze” to be paid and dispensing the payment. He was a constant presence at the first floor of the Tai Loy Restaurant, seated at a table for 12. No one coming to collect bribes departed empty-handed. As business picked up dramatically after the Kowloon City crackdown in June 1976, Ah Hung felt the need to find a better way of reporting the higher turnover to his boss - Ah Biu. He started systematically recording the drug racket’s daily expenses and squeeze payments using secret codes to denote the collectors’ identities and the units to which they belonged. These accounts provided important clues - and evidence - in the coming investigation of the corruption syndicate.

The drug racket crumbled and all the corrupt activities came to a halt following the arrests of its key members. It was some months later that the ICAC investigation got into gear. Said Tony Lui: “There was no way we could conduct any on-site inspection or examination.’’ However, the account books seized by the police offered information aplenty of the how the racket operated between 1 June to 9 August 1976. In the books, 2,610 entries told of more than $700,000 in bribes was handed out, an average of $10,000 a day.

When the ICAC interviews with Ah Biu and his two accomplices finally came to an end, as many as 400 pages of witness statements, or roughly 400,000 words in Chinese, were taken. The statement-taking job lasted three long months, a task Tony likened to copying tracts of textbooks as punishment set by a teacher.

Note: All names and nicknames given to the defendants and suspects in the story are fictitious. The restaurant and corner store referred to in the story were closed long ago.

The cost of living in the mid-1970s (Reference prices at 1976 - 1977)
Average selling price of a Wan Chai residential flat	$316.00/sq.ft
Average daily wage of an unskilled labour	About $25.00
Starting monthly salary for government typists	$830.00
Single journey fare for tram	$0.30
Retail price of a Chinese newspaper	$0.30
Sources: GRating and Valuation Department, Hong Kong Year Books and Civil Service Master Pay Scale

A Life Wasted

While Ah Biu might be the de facto head of the drug racket, Louis Cheung felt that his deputy Ah Hung was very much the brain of the outfit. “Digging out information from Ah Hung was a test on my investigation skills and perseverance,’’ Louis said. “At first, he would only provide information that he thought would favour him in court and might give him a reduced sentence for drug trafficking. I tried different tactics and methods to convince him that concealing the truth would backfire and not in his interest. Finally he agreed to explain every entry in the account books, as well as details of the corruption syndicates, including their organisational structures, members, the amount of bribes received, and succession plans and so on. The codes were his invention.”

Despite a lapse of 30 years, Louis cannot help but feel sorry for Ah Hung. To Louis, Ah Hung was witty and composed, and with a clear head. He loved his family. He went to great lengths to cover up his illicit track from his family so as to shield his wife and children from worrying. He kept a regular schedule every day, just like an ordinary workman. He led a normal life and did not smoke. Heroin was forbidden. To this date, Louis still laments how Ah Hung had wasted his life and talents by associating with drug trafficking and corruption. He was sentenced to jail at the age of 30 and died of illness not long after his release.

Coded Identities (original code words are in Chinese)
Code	Unit represented
Chung	Kowloon Police Headquarters
Lo Kwok	Kowloon District Special Duties Squad
Hak Chai	Triad Society Bureau, Kowloon Police Headquarters
Chung Ching	Criminal Intelligence Bureau, Kowloon Headquarters
Chung Ching	Criminal Intelligence Bureau, Kowloon Headquarters
Ching	Criminal Intelligence Squad on district level
Pun C	Yau Ma Tei Criminal Investigation Department
Pun P	Yau Ma Tei Uniformed Branch
Beat	Yau Ma Tei policemen on street patrol
Y	Yau Ma Tei Vice A and B Squad
Chai	Sergeants and Station Sergeants of Yau Ma Tei UB
Dog	Yau Ma Tei Dog Unit
Chap	UB policemen on plain-cloth duty
PT	Police Tactical Unit
E	Patrol vehicles of the Emergency Unit
Homicide	Homicide Squad
A	Yau Ma Tei Auxiliary Police
Yat Kee	General Crimes Investigation Bureau
Kung	Preventive Service, Commerce & Industry (C&I) Department
Kung Kee	Staff working at the 10/F of the C&I Department

All names and nicknames given to the defendants and suspects in the story are fictitious. The restaurant and corner store referred to in the story were closed long ago.

Coherent Witness Statements

It came as a shock to learn from the account books just how many law enforcement units and officers had been on the take in Yau Ma Tei.

“In our separate interviews with the three witnesses, we found that their recollection of people and events tallied strongly with only minor variances,’’ Tony Lui noted. “Even the appearances of the bribe-takers, their nicknames, the police units they worked for, staff identity numbers and the amount of bribe money they received were consistent. This affirmed that many officers from the police and other agencies had close associations with key members of the drug ring. It was also a telling fact that criminals were able to maintain a close relationship with law enforcement officers in such a frank and unreserved manner. We therefore considered the witness statements highly credible. We then set about to verify and substantiated the claims.”

Suspects were idenified by Photo Identification Parade (Photo from the archive)

The Photo Parade

Under normal circumstances, witnesses are asked to identify suspects following arrests from a line-up of similar looking people.

“Occasionally, the more preferred way is to positively identify the suspects ahead of an arrest operation by conducting a photo identification parade. This was what we did in this case. We took statements from three witnesses, then identified the suspects for in-depth investigation before proceeding to arrests,” Tony said.

However, since the syndicate members and bribe takers were used to referring to one another by nicknames such as ‘Nut,’ ‘Gardener Chan,’ ‘Lanky Cheung’ and ‘Mountain Dog,’ it was difficult to make out a suspect’s true identities with no reference to their real names. Who really were ‘Lanky Cheung’ and ‘Mountain Dog’? Was ‘Lanky Cheung’ really tall or was he being ridiculed for being short? Did Mountain Dog get his name because he really was a mountaineer? To minimise the risk of arresting the wrong persons during subsequent operations, the investigation team finally settled on a photo identification parade.

Louis Cheung noted: “To carry out a photo identification exercise was not difficult in itself, but the accompanying procedures were complicated. Since there were frequent contacts between members of the drug ring and the bribe collectors, it should be a simple matter to ask witnesses to identify the right persons from the photos. However, principles of fairness and established procedures required us to find eight other ‘look-alike’ photos of a suspect for the identification exercise. With the assistance of the senior management of the Police, we were provided with photos and basic personal particulars of nearly all serving police officers. On the strength of the witness statements, we selected, labelled and pasted the ‘look-alike’ photos on a single piece of paper for detailed examination by the witnesses.

“Every tiny detail of the identification process had to be recorded. If an alleged suspect was identified, the witness would be asked to write down the relevant number on the statement and signed his confirmation. Due to the great number of photographs involved, the process was extremely labour-intensive and time-consuming.”