Zhao Long, the same Chinese who was unmasked as one of the heads of Lucky South 99’s illegal scamming hubs during a September 17 Senate hearing, is the same person who headed the Lapu-Lapu City Chinese guild that had been donating computers to the city government since 2019.
No other than Presidential Anti-Organized Crime Commission (PAOCC) spokesperson Winston Casio confirmed during the Senate hearing of the Committee on Women, Children, Family Relations and Gender Equality joint with the committees on Migrant Workers, and Public Order and Dangerous Drugs, that Zhao Long owned and operated one of the Lucky South 99 illegal scamming hubs.
Rappler reviewed documents from the Securities Exchange Commission (SEC) that belonged to Zhao’s businesses and found that he had also been the chairman and president of the Lapu-Lapu City Philippines Tourism Ethnic Chinese Guild since 2019.
The guild’s articles of incorporation revealed that it was formed on August 16, 2019. To recall, Lucky South 99 was set up in July 2019, according to business records — only a month apart from each other.
The incorporators of the guild include Long’s father, Zhao Shouqi, Chinese nationals Yingpin Lin, Yangbao Wang, Yunyun Chang, and a Filipino citizen named Wilson Santos Chua.
Shouqi was designated the guild’s chief financial officer.
What’s interesting is that the purpose of the Cebu-based Chinese guild is something as innocuous as “to promote the Philippines as a tourism destination to the Chinese market.” This is exactly what is stated in the guild’s articles of incorporation.
However, authorities were unconvinced.
“These companies are suspected of being fronts to conceal scam operations conducted on the premises,” PAOCC’s video presentation narrated during the Senate hearing.
Tourism in Suwu
The “Suwu” in “Royal 1 Suwu KTV Corporation” stands for Cebu.
The KTV is just one of the many businesses inside the controversial Tourist Garden Hotel that was shut down on September 2 by Lapu-Lapu City Mayor Junard “Ahong” Chan right after 169 foreigners were caught on August 31 in the hotel compound running scam hubs.
Affidavits from rescued Indonesians and an “administrator” pointed out that more than a hundred trafficked workers moved to the hotel compound months after the June 4 operation at the Lucky South 99 hub in Porac, Pampanga.
But this particular KTV was already used as a site where malicious individuals could purchase women and bring them out for lascivious activities.
A 2023 judgment by Regional Trial Court Branch 73 in Lapu-Lapu City detailed the events of an entrapment operation conducted by the National Bureau of Investigation (NBI) at the KTV lounge.
On August 2, 2019, NBI operatives went undercover at the Royal 1 Suwu KTV. There, Chinese Zeng Dan and Quan Yi Qing offered the undercover operatives a selection of nine Chinese women whom they could “take out” for P30,000 each.
Zeng and Quan were arrested immediately at the scene. The court ruled that Zeng and Quan were guilty of attempted trafficking and sentenced them to 15 years of imprisonment and a fine of P1 million.
At least 34 Chinese women were rescued during the operation. During the Senate hearing, PAOCC officials revealed that these women had been lured from China with offers of legitimate employment in a Philippine offshore gaming operator (POGO) hub but were subsequently forced into sex work.
‘But they operated again’
“At that time, it happened in the KTV Bar. It was closed but they operated again because I think the case was dismissed,” the Lapu-Lapu City mayor told reporters in a press conference on September 2.
Chan was present on August 6, 2019 at the hotel compound where the KTV is located. He personally conducted an inspection and found no reason to close the business establishment back then even when trafficking activities were being conducted onsite.
According to the mayor’s office, the Royal One KTV was issued a business permit on February 26, 2020. A business permit pasted on the wall near the counter of the KTV showed that they were able to renew their license to operate on May 27, 2024.
The mayor affirmed during the September 2 press conference that the city did its part in inspecting the hotel compound thoroughly and saw no anomalies.
So when he shut down the KTV and other businesses at the hotel in September 2024, it was justified because “there were illegal activities conducted there.”
“The permits they got from [the city], they used for these illegal activities,” Chan said during the press conference.
Modus operandi
The guild’s base of operations — Tourist Garden Hotel — started accommodating more than a hundred trafficked foreigners from Lucky South 99 on August 2, 2024, according to an administrator’s affidavit.
“When we double-checked the Tourist Garden Hotel, it was still in booking websites…but it no longer had available rooms when we double-checked because all of it was used by the [POGO workers],” Casio told Rappler on Friday, September 20.
The preferred modus operandi of the POGOs now, according to the PAOCC spokesperson, is to “disintegrate” into smaller units by spreading themselves to the provinces to lessen suspicion from residents and authorities.
He explained that these hubs are able to “hide in plain sight” because of their sense of impunity.
From 2019 to 2024, the guild, its connected businesses, and the hotel regularly paid taxes to the city government, according to the mayor. Now-deleted social media posts showed that the guild had also been a consistent donor of computer units to the Lapu-Lapu City government between 2019 and 2020.
“I would like to believe that they’ve gotten complacent because they feel that they can bribe anybody and just about anybody in the Philippines…Organized crime will never be able to thrive in the Philippines without public corruption,” Casio said.
While the “smaller units” continue to spread out to the provinces, the PAOCC spokesperson told Rappler that they’ve started working on “catching the bigger fish.”
On Thursday night, September 19, authorities arrested Chinese businessman Tony Yang, also known as Yang Jian Xin, as he landed in Manila from Cagayan de Oro (CDO). Yang was caught on the basis of a mission order against an undesirable alien.
He is the elder brother of former president Rodrigo Duterte’s economic adviser, Michael Yang, also known as Yang Hongming.
During a congressional hearing on Thursday, Santa Rosa, Laguna Representative Dan Fernandez said that Yang Jian Xin owns Golden Citi Development Incorporated, which also owns the Yangze Building in CDO — the location of a POGO hub named Oroone Incorporated.
The CDO city police confirmed at the hearing that Oroone Inc. had shut down operations in July 2023 before police got there.
“By apprehending Tony Yang in Manila, that means to say we’ve alerted his managers in Cagayan de Oro so we would expect that the people in Cagayan de Oro are packing their bags now,” Casio said in a mix of English and Cebuano.
As of this writing, authorities have managed to bust one POGO in the Visayas — to be precise, a part of the Lucky South 99 POGO from Porac, Pampanga.
It’s small fry compared to the big fish that’s waiting in the vast Philippine archipelago, but as Casio put it, “We prefer to get the big boss rather than the small fries because we can get the small fry later on.” – Rappler.com