December 17, 2008

Houston woman pleads guilty to 'structuring' prostitution proceeds

DENVER - A Houston, Texas, woman who operated a business for prostitution, pleaded guilty here before U.S. District Court Judge Marcia S. Krieger on Tuesday to illegally "structuring" the proceeds of her business to evade currency reporting requirements. This plea was announced by: Troy A. Eid, U.S. Attorney, District of Colorado; Christopher M. Sigerson, special agent in charge, IRS Criminal Investigation; and Jeffrey Copp, special agent in charge, U.S. Immigration and Customs Enforcement (ICE).

Yong Gates, 70, is scheduled to be sentenced by Judge Krieger on June 9, 2009 at 3 pm.

Gates was charged by Information on May 28, 2008. According to the facts contained in the original charging document and in the plea agreement, from December 2001 through Aug. 6, 2003, Gates employed prostitutes at her business, Sun Health Spa, located at 10763 Turner Blvd. in Longmont, Colo. She admits that Sun Health Spa generated much of its revenue from acts of prostitution.

From June 30, 2003 through Aug. 14, 2003, Gates concealed prostitution proceeds totaling $26,050. She deposited the prostitution funds in amounts less than $10,000 into her business bank account in an attempt to evade currency reporting requirements (also known as structuring).

Gates faces up to five years in prison, and not more than a $250,000 fine, for structuring her deposits.

In addition to pleading guilty, Gates has agreed not to contest a civil forfeiture action, where she will forfeit assets valued at no more than $125,000, as well as seized assets, including: $550 in currency seized from Sun Health Spa in August 2003; $4,069.33 seized in December 2005 from a bank account in the name of Sun Health Spa; $2,050 in currency seized from Sun Health Spa on Dec. 15, 2005; and $6,000 in currency seized from Gates' residence.

"'Structuring' funds so that they are hidden from the IRS is a crime," said U.S. Attorney Troy A. Eid.

"IRS Criminal Investigation investigates potential structuring violations to ensure the integrity of the Bank Secrecy Act and to combat illegal activities like prostitution," said Christopher M. Sigerson, IRS Special Agent in Charge of the IRS-Criminal Investigation, Denver Field Office.

"Using our unique law enforcement authorities, ICE investigates the critical financial aspects to crimes," said Jeffrey Copp, special agent in charge of the ICE Office of Investigations in Denver. "For many crimes, the money that's involved is the hardest to hide from authorities. These illegal money transactions may be the only evidence available to pursue prosecutions." Copp oversees a four-state area which includes: Colorado, Montana, Utah, and Wyoming.

This case was investigated by the IRS's Criminal Investigation Division and U.S. Immigration and Customs Enforcement (ICE). The case is being prosecuted by Assistant U.S. Attorney Joseph Mackey. Assistant U.S. Attorney Tonya Andrews of the U.S. Attorney's Office's Asset Forfeiture Unit is handling the forfeiture.

-- ICE --

U.S. Immigration and Customs Enforcement (ICE) was established in March 2003 as the largest investigative arm of the Department of Homeland Security. ICE is comprised of five integrated divisions that form a 21st century law enforcement agency with broad responsibilities for a number of key homeland security priorities.

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