Scientific Game

Going Legit

Last month’s release from prison of the notorious “Broken Tooth” won’t spark a return to the bad old days of triad turf wars. There’s too much at stake in the new Macau

Wednesday, 23 January 2013 13:06
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As Macau’s gray dawn gave way to sunrise at 6:50 a.m. on Saturday, 1st December, former local 14K triad boss “Broken Tooth” Wan Kuok Koi strolled out of the city’s Coloane Prison after serving a sentence of nearly 15 years for a string of gangland crimes.

More than 50 journalists had gathered outside the gates of the prison since midnight hoping to catch a glimpse of the now 57-year-old Mr Wan on his release. He headed quickly to the white Lexus and two stern-faced minders that awaited him. As the car drove away, one reporter managed to ask him whether his release would affect Macau’s law and order, and he replied from the passenger seat: “It definitely won’t happen. Nobody is causing trouble so why would there be any trouble?”

Mr Wan clearly continues to wield influence, and according to the South China Morning Post, his “gangland brothers had reportedly prepared a 100-table feast” on the night of his release to celebrate his freedom. Still, he made sure to first make a brief public appearance to dismiss concerns he would return to his old ways. Saying he was no longer young, he stressed: “I don’t want to affect the stability of Macau. There’s absolutely no way I want to do that. I want to be left alone.”

The smart money is on Broken Tooth staying out of trouble.

“I don’t anticipate a return of Macau’s violent past, as Macau casinos are growing and the pie is getting bigger,” said Au Kam San, a lawmaker who grew up in the city. “The Chinese government has made it clear that it wants stability in Macau. It can take away everything it granted if these guys don’t behave.”

Indeed, according to the Post, “Sources said officials from the central government’s Macau liaison office visited Mr Wan [before his release] to tell him to stay out of trouble.”

At the top of Beijing’s agenda is the maintenance of social stability following the appointment of the Communist Party’s new leaders in November. While Mr Wan was able to run rings around Macau’s colonial administration for years, he is no match for the Chinese government, which would have no qualms about throwing him back behind bars if there was any public hint of him disturbing the peace.

Also, in a pre-emptive strike a month prior to his release, a sting operation resulted in the arrests of a number of his former associates on suspicion of planning to commit murder. Among those picked up was Artur Chiang Calderon (also known as Chan Yuet Bo), a former police officer and Mr Wan’s right-hand man.

Yesterday’s Man

“Wan Kuok Koi is yesterday’s man,” said Steve Vickers, who runs Vickers and Associates, a Hong Kong-based risk consultancy. “Whilst he remains connected with his previous gang members, there is just no room for the ‘Wild Bunch’ in Macau anymore.”

The owner of a leading Macau junket operator added: “The world has changed for Macau. The new world requires brains, not fists. We all have to adjust ourselves accordingly. Furthermore, we need to follow the directives from Beijing, or follow those who went to jail.”

During his incarceration, Mr Wan missed out on most of the spoils of Macau’s casino boom, which saw his former triad rivals become vastly more wealthy and powerful thanks to their close connections to the city’s leading junket operations that dominate the VIP gaming business, which constitutes around 70% of Macau’s total casino revenue. According to a former police officer with close ties to the industry: “If you look down the list of licensed junket operators in Macau, sure, you will not find one known triad among them. But I can assure you, none of the big junket operators in Macau could operate unless they were connected to the triads.

“We are talking the traditional triad operators in Macau, plus the Sun Yee On and Wo Hop To from Hong Kong, and others. There’s just too much money washing about for them not to be involved. It’s a proxy system, so it’s no surprise that there is quite a degree of concern about the release of Wan Kuok Koi.”

One of the principal reasons is mainland China’s currency controls, which limit the amount of cash citizens can take out of the country to 20,000 yuan—US$3,210—a day. According to one investment analyst, “It’s not possible, in practical terms, to do away with the triads when it comes to Macau’s casino industry, where dubious money transfers are commonplace. They do all the dirty work the casino operators can’t do. Another reason you need them is that you sometimes need to go hard to collect debts, especially when it comes to players from mainland China, where the courts don’t recognize gambling debts.”

He adds, “You have to give [the triads] some credit for the contributions they have made to the gambling industry and to Macau.”

Mr Wan’s interests were not completely left behind during Macau’s boom, however, with members of his family, and possibly members of his old crew who have either avoided imprisonment or been released, exerting their influence on some of the city’s VIP operations. Reports are that Mr Wan may be seeking to get involved in under-the-table side-betting in certain of the private high-roller rooms—a practice, never acknowledged or officially verified, that allows the circumvention of the government’s burdensome 39% effective gaming tax rate.

War and Peace

Mr Wan’s imprisonment marked the cessation of the triad turf wars and escalating gangland violence that wracked Macau in the latter half of the decade leading up to the handover of sovereignty from Portugal to China at the end of 1999.

The turf wars were exacerbated by Macau’s economic stagnation in the latter half of the ’90s, leaving competing gangs to scrap over a diminishing pie of gambling money.

In Mr Wan’s heyday, Hong Kongers constituted the vast majority of visitors to the city, and triads made money through loan-sharking, running illegal gambling operations and other vice activities. Following Mr Wan’s imprisonment and Macau’s reintegration with the motherland, mainland Chinese visitors began featuring more prominently in the visitor mix, especially following the central government’s progressive easing of travel restrictions on its citizens wishing to visit Macau and Hong Kong from the second half of 2003. Demand from mainland China—now by far the city’s main source of visitors—has underpinned Macau’s stratospheric casino boom and grown the pie to such an extent that there should theoretically be enough for all the competing triad groups. The triads, in turn, have reinvented themselves through their interests in junket and VIP operations, earning wealth and legitimacy far beyond what they could have imagined when they were waging war in the ’90s.

Mr Wan’s release is unlikely to spark a return to the bad old days. “There’s too much money at stake,” according to Credit Suisse Group analyst Gabriel Chan. “If I were another junket, I’d do my best to stop him messing things up.”

Chinese are known for their pragmatism, especially when it comes to business. The other groups will likely find a face-saving, behind-the-scenes accommodation that provides Mr Wan a livelihood sufficient to maintain his flashy tastes. After all, the pie, measured in terms of Macau’s gross gaming revenue, stood at US$38 billion in 2012. Any temptation Mr Wan may face to seek a bigger  share will be tempered by the understanding he was absent while that pie grew to its current level, as well as his awareness of Beijing’s track record of executing gangsters that get out of line.

The Godfather of South China

broken tooth

At the height of his power in 1998, 14K triad boss Wan Kuok Koi graced TIME magazine and was tipped— audaciously—by the publication as being “set to become one of the world’s top crimebosses”

It has been a long time since Antonio Marques Baptista, director of the colonial Judiciary Police, watched his car explode in flames as he went jogging with his dog on Macau’s Guia Hill on 1st May 1998.

Hours after the car bomb went off, Wan Kuok Koi, then the leader of a faction of Macau’s 14K triad society, was behind bars. He was never charged in connection with the bombing, but it was the final straw for the Portuguese authorities.

In the weeks prior to the attack, six murders were linked to triads—including a Marine Police officer, a gambling inspector and the chauffeur of the territory’s most senior crime fighter.

Mr Wan was eventually jailed for a string of gangland crimes. The litany of charges against him included a plot to import a vast arsenal of weaponry, including anti-aircraft missiles, hand grenades and automatic weapons from Cambodia. In the end, his boasts about being the head of a criminal clan and related racketeering saw him sent up for nearly 15 years.

Of course, there was more to Mr Wan’s downfall than a simple police investigation and highly publicized trial. Internecine underworld warfare also played its part in taking down the brash and boastful gangster known as “Broken Tooth”.

There is no doubt he was a larger than-life character, but he could also be less than smart. In Mr Wan’s old Heavy Club disco, an effigy of a uniformed Macau police officer used to hang over the middle of the dance floor.

There’s also no doubt he had a significant and committed following within his faction of the 14K. This muscle was obvious after his imprisonment, which sparked a furious response as his gang went on the rampage. A wave of fire-bombings ensued. One particularly spectacular attack damaged almost 100 vehicles. Shop fronts were gutted in 24 separate arson attacks. Senior government prosecutor Lourenço Nogueiro and his pregnant wife were gunned down in a motorcycle driveby shooting. Both survived.

At the height of his power in the mid-’90s, Mr Wan raked in tens of millions of patacas  from his loan-sharking and illegal gambling operations as casino tycoon Stanley Ho Hung Sun’s franchise system for running VIP rooms spun out of control.

Mr Wan saw himself as the “Godfather of South China,” and such was his overdeveloped sense of self-belief that at one stage he thought he could unify the 14K and become “boss of bosses”.

Perhaps he was just a talented spin doctor, nothing more than a common hoodlum suffering from megalomania and delusions of grandeur.

Much of his approach to gangsterism can be put down to his limited schooling, a common problem among a whole generation of Macau youngsters that also was a factor in enabling him to command such a large army of foot soldiers.

He also had a strange nickname, but he’d earned it.

He cut his teeth—and lost several—in vicious street fights as a young tough. One veteran crime reporter recalled Mr Wan being rushed to hospital as a teenager, “blood dripping from half a dozen stabs”.

In 1998 he produced a 14 million pataca (US$1.7 million) autobiographical film called “Casino,” a tacky tale of triad mayhem. Hong Kong star Simon Yam Tat Wah—the brother of top Hong Kong police officer Peter Yam Tat Wing—starred as Mr Wan, and the film’s premiere took place in Hong Kong just five days after his arrest.

“He is a good boss and I respect him as a friend. Films often exaggerate things,” Simon Yam said at the premiere. “I spent time with him when we were filming and he is like a kid. Everyone in Macau respects him.”

Indeed, during his trial Mr Wan claimed to be a bona fide promoter (he organized several Canto-pop concerts), real estate investor, gaming chip trader and high-stakes gambler. Yes, he knew about the 14K, but he was not a member, never mind a leader. No one bought it.

After the sentencing at the Court of First Instance, he flew into a rage and jumped onto a bench, screaming at officials: “You’ve taken dirty money! ... This is the worst verdict of the century!”

Asked to calm down by police and court officials, he glared hard at the officers, put his fingers menacingly like a gun to his own temple and screamed an obscenity. Whether that rage has subsided may be a deciding factor in how he decides finally to live his life as a free man.

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