DOES WEALTH BUY A GOOD EDUCATION?

My School results point to some startling surprises

NEWS 6-7
PUBLISHED IN MELBOURNE SINCE 1854

MARCH 5, 2011 5

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theage.com.au

ILLEGAL BROTHELS AN INVESTIGATION BY NICK McKENZIE AND MARIS BECK

The secret world of Melbournes sex trade

For more than a decade Xue Di Jenny Yan has survived as one of the leading matrons of Melbournes illicit sex trade, building a multimilliondollar empire of illegal brothels that have deed efforts to curb their proliferation.

Why do we treat our elite women athletes as second class?

SPORT

Michael Gordon

PICTURE: MAL FAIRCLOUGH

CHINESE organised crime syndicates are running multimillion-dollar prostitution rackets across Melbourne by bribing officials and exploiting abysmal regulation. The syndicates are linked to human trafficking and arrange for dozens of Asian women to travel from interstate and overseas often on student visas to work in brothels. In several instances, figures linked to the illegal prostitution syndicates including Mulgrave woman Xue Di Yan are also licensed by the Victorian government to run legal brothels. The bribery involves a senior City of Yarra enforcement officer responsible for shutting down illegal brothels who had been receiving regular bribes from two brothel operators since 2005. But the council official, who is expected to face corruption charges

and resigned late last year, is only one factor contributing to the boom in illegal brothels. There are an estimated 300 to 400 illegal brothels in Victoria, which is around four times the number of the states legal ones. Victorias illegal sex industry has enjoyed a decade of unparalleled growth due to a systemic failure by police, Consumer Affairs, the Immigration Department and local councils, which are variously hamstrung due to

inadequate powers, legal loopholes and under-resourcing. A recent six-month police operation run by a small team of detectives from Richmond has highlighted the reach and resilience of the illegal industry. The police operation culminated in November with the City of Yarra officials arrest, raids on up to a dozen illegal brothels and the discovery of two Chinese women on student visas

and two Chinese women with no visas. Of those women, authorities say two were living in a residence being used for massage services. But the police inquiry was limited to Melbournes inner north and the crime syndicates it targeted are still operating, making thousands of untaxed dollars every week by selling sexual services in massage or relaxation premises. Some syndicate

C O N T I N U E D PAG E 2

INSIGHT

Doing well in Footscray doesnt cost $14m

B Y J E W E L T O P S F I E L D E D U C AT I O N E D I TO R
IN 2009, Geelong Grammar spent $20,452 on every student and $7.8 million on capital works. The high-fee Anglican school has a $14 million Wellbeing Centre at its Corio campus, with a swimming pool, dance studio, indoor courts and fitness centre, and is seeking donations for a $1.7 million upgrade of the equestrian centre, which allows students to bring their horses to school. In 2009, St Johns School in Footscray West spent $8503 on every student and $174,000 on capital works. The low-fee Catholic primary school has an asphalt playground, partially blocked by building works, and recently invested in some synthetic turf so students had somewhere to sit while they ate their lunch. But while the revamped My School website yesterday revealed the yawning resources chasm between schools, it also showed money does not necessarily buy better literacy and numeracy. Ninety per cent of the students at St Johns come from non-English-speaking backgrounds, and 60 per cent of their parents receive the educational maintenance allowance for lowincome families. Despite this, the year 5 students at St Johns outperformed their peers at Geelong Grammar in four out of the five NAPLAN tests, which assess reading, writing, spelling, grammar and punctuation, and numeracy. St Johns principal Jean Corr believes her schools literacy and numeracy results, which have continuously improved since 2008, are the result of quality teachers and supportive parents, and show you dont need money for a good education. An analysis for The Saturday Age into which schools performed best in numeracy and reading NAPLAN tests also uncovered some surprises. The year 3 students at Gunbower Primary School in northern Victoria topped the state in maths, while Korowa Anglican Girls School triumphed in reading. In year 5, Brunswick South primary outperformed every other school in reading and Yarra Junction primary top scored in maths. In year 7, Yesodei HaTorah College received the highest score for numeracy and Balmoral Community College for reading. By year 9, the selective-entry government schools Melbourne
C O N T I N U E D PAG E 7

Drawn to the deep. Why cavedivers take the risk

NEWS NEWS
ISSN 0312-6307

Notable performers PAGES 6-7 Editorial PAGE 22

WEATHER
MELBOURNE Mostly sunny 10 23 BALLARAT Mostly sunny 5 20 BENDIGO Sunny 7 23 GEELONG Becoming sunny 9 21 HORSHAM Sunny 6 24 MILDURA Sunny 10 26 SALE Possible shower 8 21 WARRNAMBOOL Sunny 8 19 WODONGA Mostly sunny 10 26 Details PAGE 27

MELBOURNE DAMS

A YEAR AGO: 35.3% AGO: 34.7%

54.1 48.3%

ODD SPOT
A German firm is using a British tradition to cash in on the royal wedding. It is selling KaTEA tea bags featuring Prince William and his bride-to-be Kate Middleton. The bags feature the faces and torsos of the royal couple with arms that hang over the rim of the cup.

INDEX
ARTS PAGE 26 CLASSIFIEDS BUSINESSDAY 22-34 COMICS LIFE & STYLE 53 CORRESPONDENT PAGES 11-15 CROSSWORDS LIFE & STYLE 52, 53 EDITORIAL, LETTERS PAGES 22, 23 INSIGHT PAGES 17-21 OBITUARIES BUSINESSDAY 42,43 SHARES BUSINESSDAY 19-21 TELEVISION LIFE & STYLE 54,55

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METAGE A001

THE SATURDAY AGE

MARCH 5, 2011

NEWS
WHERE TO FIND
LETTERS THE ARTS WEATHER THE NAKED CITY pages 22-23 page 26 page 27 page 28

INVESTIGATION Authorities say 300 brothels operate illegally in Melbourne.

Behind these suburban streetscapes lies a

F RO M PAG E 1

LIFE & STYLE

WHATS ON THIS WEEKEND GARDENING CROSSWORDS, PUZZLES TELEVISION HOROSCOPES pages 4-7 page 17 pages 52-53 page 54,55 page 55

BUSINESSDAY
OBITUARIES page 43

LOTTERIES

Powerball (draw 772) dividends: Division 1, no winners; division 2, $64,392.80; division 3, $6884.65; division 4, $134.65; division 5, $65.50; division 6, $25.95 and division 7, $14.05.

CLARIFICATION

In a column in Wednesdays Age, Peter Costello claimed AFL chief executive Andrew Demetriou had taken nearly two weeks to respond publicly to revelations about the relationship between player manager Ricky Nixon and a 17-year-old girl. In fact, the AFL responded on the first day that the matter was reported and officials including Mr Demetriou commented on it on each of the subsequent three days.

THE SATURDAY AGE Editor: Steve Foley Deputy editor: Margaret Easterbrook Insight editor: Duska Sulicich Art director: Bill Farr Designer: Andrew Wolf Senior editor: Warwick McFadyen Night production editor: Michael Schlechta News editor: Liz Minchin Correspondent editor: Carolyn Jones Forum editor: Roslyn Guy Arts editor: Gina McColl FOUNDED IN 1854 Published by The Age Company Pty Ltd (ABN 85 004 262 702) of PO Box 257, Melbourne, VIC 3001. Printed by The AGE Print Company Pty Ltd (ABN 36 096 607 402), Western Avenue, Tullamarine. Paul Ramadge, Editor in Chief, takes responsibility for political editorial comment in this publication. To find out more about The Age, its people, history and services, go to about.theage.com.au

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figures have even set up new illegal brothels. At least one of these syndicates is, according to a government source, suspected of human trafficking from Asia and interstate. The Saturday Age investigation can also reveal how Melbournes prostitution racket organisers are thumbing their noses at the often piecemeal efforts to combat them by state and federal authorities. Ms Yan, one of the central targets of the Richmond police operation, has run a multimillion-dollar prostitution racket in Melbourne for over a decade despite efforts by authorities to disrupt her. In 1999, the now disbanded Victoria Police vice squad told a court that Ms Yan was running several illegal brothels, including one in Nicholson Street, North Fitzroy. Ms Yan or her associates were simultaneously managing a licensed brothel, the Oriental Plums, in Thomastown. A year later, after police raided Oriental Plums, immigration authorities found at least one Chinese woman working there illegally. In late 2010 Richmond detectives found Ms Yans syndicate was still running the Nicholson Street premises as an illegal brothel. It also retains its state government licence to run Oriental Plums, which is registered in the name of one of Ms Yans relatives. Over the past three years, the Department of Immigration and Citizenship has discovered on at least two occasions several Asian women without proper visas working in brothels legal and illegal linked to Ms Yan. The Yan syndicate is also linked to one of the men caught bribing the City of Yarra official. Chinese-Australian Anton Lu, who runs an illegal brothel in Swan Street, Richmond, is understood to have bribed the City of Yarra official in return for tipoffs about raids. Mr Lu has also studied to become a licensed migration agent. Another Chinese-Australian

citizen who runs a rival prostitution racket comprising up to four illegal brothels, Tony Tang, was also bribing the official. The illegal brothels run by Anton Lu, Tony Tang and Xue Di Yan make millions of dollars for organised crime syndicates every year and freely advertise as Asian massage providers in newspapers. Ms Yan owns or has recently sold multimillion-dollar properties in Richmond, Fitzroy North and Mulgrave. Her Fitzroy North and Richmond premises housed illegal brothels until late last year. The policing and regulation of the illegal and legal sex industry is handled by a multitude of agencies, including the Consumer Affairs and Justice departments, the police and local councils. Police and council sources said that aside from some infrequent joint investigations, most agencies do not work together or share information. The sources said most agencies lacked the power and resourcing to be effective, a view backed by the Coalition when in opposition. While the Baillieu government has signalled it wants to overhaul the way the state combats the sex industry, and has acknowledged the current system is a failure, it is yet to outline in detail any proposed changes, aside from giving police a greater role. But policing experts, including Monash University associate professor Colleen Lewis, have said that any such move should be subject to strict oversight to avoid corruption. Integrity concerns led to the police vice squad being disbanded in the late 1990s, a move which industry watchers believe has contributed to the boom in illegal brothels. But putting police in charge would also contradict the recommendations of a year-long inquiry into sex trafficking in Victoria, released last June, which said the Attorney-General should have responsibility for brothel regulation.

Right: illegal brothel operator, Jenny Yan

RAIDED BROTHELS AND RESIDENCES LINKED TO YAN

Fitzroy North Melbourne West Melbourn Melbourne elb u ne Richmond Burnley Abbotsford

, EET STR ING SPR IR VO SER RE

REPORT: MARIS BECK and NICK McKENZIE

AS ONE of the leading matrons of Melbournes illicit sex trade, Xue Di Jenny Yan has done more than simply survive a decade of various, mostly failed government and policing efforts to curb the proliferation of prostitution rackets. She has prospered. Along with other senior figures in her trade, Yan has made millions by building an empire of illegal and licensed brothels. Sex always sells well. Yan is far from alone in perfecting a profession that has benefited from regulatory confusion and corruption. But her story highlights just how easily those running sex rackets can exploit the system. It was more than a decade ago that Yans name was first publicly associated with brothels masquerading as massage parlours. In 1999, the Victorian Civil and Administrative Tribunal heard that she was managing licensed brothel Oriental Plums and licence-exempt brothel Magical Touch. Also in her patch were at least two illegal brothels and three suspect massage parlours. The tribunal rejected her application for a massage centre

in Nicholson Street, North Fitzroy, finding that Yan had shown a blatant disregard for the law. Yan opened the parlour anyway. As VCAT had been warned, it offered sex on the sly. It was still operating at the end of last year, as was another brothel she was managing in an ordinarylooking terrace house in Madden Grove, Richmond. They were only two of the estimated 300 illegal brothels that authorities say operate relatively freely throughout Melbourne, along with the 100 or so legal ones licensed by the Department of Justice. Yans businesses, which have helped her amass more than $5 million worth of properties and other assets, are part of a

larger criminal network that is suspected of having links to human trafficking. Also tied to this syndicate is Anton Lu, who runs a sex den in Swan Street, Richmond, which is described in an online brothel rating site as seedy, right down to the sunken mattresses. The syndicate also runs a dozen or so legal and illegal brothel across Melbourne. They are a moveable feast, shutting down when things get a little hot only to open up around the corner. As they have moved, so do the women who work in them. Many are illegal immigrants or students from China, South Korea and Thailand who work both in Melbourne and Sydney. Federal authorities sus-

pect many are forced to work in order to pay off debts. Last year, Yans activities came to the attention of authorities once again. On November 3, detectives from Richmond led a joint operation with raids on 15 brothels and residences , including Yans Nicholson Street and Madden Grove brothels, and others in Preston, Clifton Hill and Abbotsford. Documents, cash and computers were seized and four illegal immigrants detained. Police will not comment on an ongoing investigation, but it is expected some of those arrested will soon be charged. The Madden Grove and Nicholson Street brothels were two of several closed. Madden Grove was sold and Nicholson Street

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NATAGE A002

MARCH 5, 2011

THE SATURDAY AGE

Their proliferation has benefited from regulatory confusion and corruption.

NEWS

syndicate that trades in sex

Below: Anton Lu, who runs a brothel in Swan Street

Premier acts on fathers heartache over murder

BY JOHN SILVESTER
PREMIER Ted Baillieu has intervened in one of Victorias longest-running murder cases after a plea from the victims father for help. George Halvagis, whose daughter Mersina was killed more than 13 years ago, asked the Premier to stop the man convicted of the murder from continuing to delay the case. Serial killer Peter Norris Dupas stabbed Ms Halvagis at the Fawkner Cemetery on November 1, 1997. Dupas, convicted for a second time of the Halvagis murder last year, has appealed, though he has not given any grounds for the action. In a letter to Mr Baillieu, published in The Saturday Age today, Mr Halvagis wrote: As one father to another I ask you to help us . . . we are tired of watching this man use the system to drag this case out. It had been estimated that the appeal could be delayed up to two years, but after reading the letter Mr Baillieu acted to short-circuit the process. I have spoken to the Attorney-General and asked him to request the Victorian Government Solicitor work in collaboration with the Office of Public Prosecutions to expedite having the case heard as quickly as possible, Mr Baillieu said. Dupas is serving three life sentences with no minimum terms for the murders of Miss Halvagis, Nicole Patterson in Northcote in 1999 and Margaret Maher in Somerton in 1997. He is also a suspect in three unsolved murders. His papers have been marked never to be released. In a separate move, the Supreme Court last week introduced widespread reforms to cut appeal delays, including: I Dismissing frivolous appeals without a hearing. I Adhering to strict deadlines and throwing out cases that are unnecessarily delayed. I Giving appeal judgments in most cases on the day of the refused on the grounds that it is a pointless exercise. Dupas was convicted of the Halvagis murder in 2007. He appealed and the verdict was set aside. The High Court then rejected his move to avoid a retrial. A second jury convicted him of the murder last year. Mr Baillieu has contacted Mr Halvagis and pledged his governments support. Mr Halvagis said Mr Baillieu had said he feels for my family and promised to try to help. I just hope we can finally put an end to this. A million-dollar reward has been posted over the murder and up to six witnesses have made claims, including former lawyer Andrew Fraser, who testified that Dupas confessed to him in Port Phillip Prison while Fraser was serving five years over cocaine dealing. But consideration of rewards has been frozen until Dupass appeal is finalised. Mr Halvagis said it was vital that Dupas should not be allowed to drag out the court process. In the familys victim impact statement tendered in court, Mersinas brother, Nick, said of Dupas: Go away and never be heard of again. Then rot in hell. In his letter to Mr Baillieu, Mr Halvagis wrote: When will it finish? Will it be 14 years, 15 years or will it be longer?

, EET STR ITH SM OD WO NG LLI CO

SW AN STR EET , RI CHM ON D

PICTURES: JASON SOUTH AND JUSTIN McMANUS

An extract from the letter.

hearing rather than written reports months later. The reforms follow a sixmonth review ordered by Chief Justice Mary Gaudron. Dupass appeal now falls under the new system, meaning it could be dismissed as frivolous. Attorney-General Robert Clark said the reforms meant the court could weed out unmeritorious appeals and have them thrown out quickly. Dupas has asked Legal Aid Victoria to pay for his appeal but funding is likely to be

has been leased. But the syndicates legal brothels are still running, as are many of the illegal ones, including Swan Street. A Victoria Police statement after the raids said the actions were the result of a long-term investigation into bribery, illegal prostitution and human trafficking. At the time of the raids, Inspector Bernie Edwards said police were committed to the liberation of any woman forced into working in illegal brothels. Department of Immigration and Citizenship authorities interviewed 11 Chinese and a Thai woman after the raids, but a spokesman said the interviews did not produce evidence of sex trafficking. But two government agencies and one NGO have

separately gathered information suggesting that the syndicates targeted in November have trafficked women in the past. For federal authorities, who are responsible for investigating the trade in humans, gaining evidence about trafficking is becoming harder, partly because the syndicates are getting smarter and partly because the women who work for them often are too scared to talk. In May last year, the AFP raided a legal brothel in Victoria and several associated residences. Twenty warrants were executed with the help of the departments of Consumer Affairs and Immigration, and arrest warrants were issued in Korea for three men allegedly

involved in trafficking. Thirty foreign sex workers were interviewed. But a federal government report in June said none of the individuals interviewed was prepared to acknowledge that they were the victim of sexual servitude or related crimes, despite indications that several had been trafficked. The government has identified 147 women trafficked into the legal and illegal sex industry since 2003 and government sources acknowledge that police still have a way to go in rescuing such women. The AFP has a dedicated anti-trafficking team in Melbourne and takes victim referrals from the Immigration Department. Department of Immigration and

Citizenship. But the department visits only a fraction of Victorias sex industry addresses, conducting about 25 compliance visits a year and following tipoffs, rather than generating investigations. A Melbourne human rights lawyer with extensive experience helping trafficking victims said many were afraid of police, and raids should be conducted in a way that engendered trust. The marching in and being gung-ho isnt going to help. Authorities are unlikely to get a handle on the problem, let alone tackle it effectively, unless more sophisticated and more victimfocused strategies are employed. Advocates say women are slipping through the web of

complex state regulations: Consumer Affairs Victoria takes the lead role in monitoring the industry, local councils try to use planning laws to shut down the illegal sex trade, the Department of Justice issues business licences, and information can be referred to police for criminal investigations. The fact that women continue to be trafficked into and within Australia to be exploited in legal brothels indicates that the current system is not protecting them, said Kelly Hinton, executive director of sex industry outreach service Project Respect. As the debate about how to fight the sex trade continues, for Jenny Yan and others like her, it is business as usual.

FORUM

NAKED CITY

George Halvagiss letter to the Premier PAGE 22 Can parents find peace? PAGE 28

Dementia link to middle-age obesity

BY MARK METHERELL H E A LT H C O R R E S P O N D E N T
MORE than 1000 Australians every week are diagnosed with dementia and, for many, it is not merely genetic bad luck but a result of being overweight in middle age. A new analysis of long-term studies of the relationship between dementia and body weight has found that people who have been overweight or obese have two to three times the risk of suffering dementia in old age a few years later. The Australian National Universitys centre for mental health research reached that conclusion after assessing the results of reputable studies from around the world involving a total of more than 25,000 people. Kaarin Anstey, a professor at the centre, said the risk of dementia for those aged over 60 rose with body weight in earlier middle life, between the ages of 40 and 60. This evidence suggests that while the hormones present in body fat were previously believed to protect cognitive function, it now appears that excess fat in middle age may be extremely harmful over the long term, Professor Anstey said. The analysis also found that there was a higher risk of dementia in old age among those who had been extremely underweight in middle age, but Professor Anstey said it was likely different processes were involved in triggering that phenomenon. Practitioners and policymakers should be concerned not just with the short-term effects obesity has on quality of life, but also about the long-term effects that obesity can have on the ageing process. Professor Anstey said that given the results covered people who were much less likely to have been overweight in their youth than was the case today, the results were a warning bell for the future. The findings underline the need for policymakers to treat dementia not just as a condition of old age but as a chronic disease which can be countered with improved health care and education earlier, said Glenn Rees, chief executive of Alzheimers Australia.

New Zealand farewells the face of a tragedy

BY KAREN KISSANE CHRISTCHURCH
IT SEEMS Shane Tomlin, the quiet man, had a sense of the end. He certainly had a sense about the Christchurch earthquake. That Tuesday morning, when he arrived at the bakery where he worked, he foretold it. In a tribute from a colleague, Bev, read at his funeral yesterday, she said: You came to work that Tuesday and told me there would be a quake that day. You said there had been a quake in Argentina and all the whales had recently beached. And then we joked about which bench we would shelter under if it turned out to be the big one. But he didnt get the chance. Poor Shane. We know that if I hadnt insisted on doing those bloody green lamingtons I would have been in the bakeshop with you guys. Within hours of the earthquake, Shane Tomlin became the human face of the tragedy. He fell through two floors to land in a only time she saw him cry. A colleague told how he shared an apple with her every day His former partner, Melanie, said: I remember Shane as a spirited, private person who just didnt want to make a fuss. He had a lot of love in his heart to give but I think sometimes he held it in rather than giving it out. She had had a rummage since his death, and found some poetry he had written a few years ago. Shane was a deep and soulful man, and he wrote deep and soulful poetry, she said. One poem read: A fear of leaving soon is near. A total change is emerging. The cycle of my life. My mind has grown over the last few years. The guilt has passed. No more. Nothing much suppressed for me. I am. He was unassuming right to the end. One sister said he had urged his rescuers, Help the others first. Dont worry about me. Ill look after myself. He was carried from the church by his family. The thin wail of child-size bagpipes, from a tiny niece playing Amazing Grace, drifted on the breeze.

PRISONERS OF WAR

Family and friends carry Shane Tomlins coffin from the funeral service yesterday, and the news photo from the earthquake that was used around the world.
womens dress shop. After he was pulled from the rubble, his head cradled in the lap of one of his rescuers, his dust-caked face was captured by a photographer in an image of survival that was picked up around the world. But Shane Tomlin did not survive, dying in hospital. Yesterday he was remembered in his beautiful home town of Kaikoura, 200 kilometres north of Christchurch. Mr Tomlin, 42, would have hated all the fuss, his sisters told the congregation at St Pauls on the Hill Presbyterian Church. He was a gentle, unassuming man who disliked being photographed and loved quiet things: his work, his turtle, Star Trek and Doctor Who, cooking and gardening but not flowers, only vegetables. Yesterday the bright sunflowers on his coffin were arranged with humble corn, broccoli, asparagus and onions. As a little boy he always wanted to be racing around outdoors. He would tell his three sisters monster tales of a big red tractor. He played hairdresser by clasping one sisters hair with clothes pegs, despite her protests. He had the appetite of a giant and ate 10 Weet-Bix for breakfast. He used the plate that went on the scales because it was the only one that could hold them, one sister said. Everyone wondered where the tall, skinny boy put them. As a man he suffered from chronic back pain but never complained, several colleagues remembered, though one friend said pain was the cause of the

Japan apologises

ROBBERY

PICTURE: KATE GERAGHTY

Australian prisoners of war have welcomed an an apology from Japan to five Australian diggers held during World War II. The former prisoners of war met Japanese Foreign Minister Seiji Maehara in Tokyo. One of the members of the group, Harold Ramsey, 89, said the apology from Mr Maehara was sincere. We waited a long time but it was sincere and [a] much better time than when I was here before in 1944, he told the ABC. This is really good, very sincere. Mr Maehara has also announced that Japan will return to Australia the historical records of former POWs. The index cards were originally offered to the Australian government in 1953 but the offer was not taken up at the time.

Big tomato heist

TRAINS

Thieves have stolen a tonne of tomatoes from an Adelaide glasshouse. The thieves broke into the glasshouse at Virginia, in Adelaides north, at night and stole the tomatoes, valued at $4000, police said yesterday. It is not the first time large quantities of fruit and vegetables have been stolen in South Australia. More than $10,000 worth of cucumbers was stolen in 11 robberies over three months in 2009.

Metro blames storms

Metro has blamed its failure to meet punctuality and service delivery targets in February on Melbournes stormy weather. It was the first time since Metro took over in November 2009 that the private train operator has failed to meet service delivery and punctuality targets in the same month. Last month, 85.2 per cent of scheduled services ran on time (target 88 per cent) and 97.8 per cent of services were delivered (target 98 per cent). Chief executive Andrew Lezala said more than 500 services were cancelled during three days of storms. Metro will compensate monthly, sixmonthly and yearly Metcard holders and eligible myki holders. It expects to be fined the maximum penalty of $1 million.

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PARTY TIME: Its carnival time in South America, with revellers taking to the streets.
WORLD PAGE 9

THE AGE MONDAY, MARCH 7, 2011

NEWS

Official who took bribes backs brothel crackdown

Regulation regime needs overhaul
By NICK McKENZIE and MARIS BECK
AGE INVESTIGATIVE UNIT
THE senior local government official at the centre of a bribery and prostitution racket investigation has called for an overhaul of Victorias failed system of regulating and policing the illegal sex industry. Ken Wolfe resigned as the City of Yarras senior enforcement officer in December after being interviewed by police investigating allegations that he received bribes over a five-year period from two illegal brothel operators. As The Saturday Age revealed, a police inquiry targeting multimillion-dollar prostitution rackets and human trafficking in Melbournes inner north uncovered up to 24 illegal brothels operated by two crime syndicates, including one run by Mulgrave woman Xue Di Yan. Mr Wolfe told The Age he had taken money from two men running illegal brothels to fuel his gambling addiction and said he expected to be charged by police with bribery offences. But he also said he hoped the investigation of his case would expose the failed system of brothel regulation in Victoria. Something good has to come out of this. The problem is huge and Victoria is not doing anything about it, said Mr Wolfe, who worked with the City of Yarra since 1998. Mr Wolfe said that local government officials who play a key role combating illegal brothels by using planning laws lacked the power and resources to have any impact and that other agencies, including the police and consumer affairs, often did nothing. He said hundreds of illegal brothels were being run by operators who knew authorities were unable or unwilling to shut them down. We would shut an illegal brothel down and it would open up five minutes later. It is a complete failure. I know I did the

The page one story in The Saturday Age: A police inquiry uncovered up to two dozen illegal brothels in inner Melbourne.
wrong thing and I should pay a price. But I am part of a bigger problem that no one is doing anything about. The laws must be changed, he said. The call for reform has been backed privately by senior police and publicly by outreach service Project Respect, the Coalition Against Trafficking in Women and former federal police officer Chris Payne who ran Australias first human trafficking investigations. Mr Payne said in Queensland, where brothels were regulated by a police prostitution taskforce, trafficking and illegal prostitution had been detected and prevented far better than in Victoria. Jocelyn Snow, a former member of Victorias Prostitution

Control Board, who now owns a licensed brothel, said the illegal sex trade was out of control. Theyve got to try to do something about it because it is just getting bigger and bigger, she said, accusing government agencies of inaction and blameshifting. Sue White, manager of sex worker support group Inner South Community Health Service, said she was seriously concerned for women in illegal brothels, who were at higher risk of STDs and violence. The government is yet to detail its plans for sex industry reform, despite its pre-election acknowledgment that the enforcement system had failed and needed urgent change. The Minister for Consumer

Affairs, Michael OBrien, has previously said Victoria Police should become the lead agency in tackling illegal sex work, although the police are yet to announce how their existing role will change. He said yesterday that the government was examining whether existing laws needed to be toughened. The Age believes that Mr Wolfe received monthly payments over a five-year period from two Chinese men Anton Lu and Tony Tang who wanted him to tip them off about any raids on their illegal brothels in Melbournes inner north. After he was arrested and interviewed by police in November, Mr Wolfe was told by police that the men were in fact part of two larger criminal syndicates.

In a further indication of the failure to control the illicit sex trade, many of the brothels raided by police as part of the operation targeting Mr Wolfe are still open or have shifted to new premises. Mr Wolfe said that after planning requirements for massage parlours were relaxed in 2005 and local councils stopped using private investigators to prove parlours were offering sex, illegal brothels became almost impossible to shut down. Mr Wolfe said he had discovered that licensed brothel owners were also running illegal brothels, and had retained their licences regardless.

GOT A TIP?

investigations@theage.com.au

St Kilda teen lied she was pregnant

By MARIS BECK and AHMER KHOKHAR
THE girl at the centre of the St Kilda nude photo scandal has admitted she lied about being pregnant to AFL footballer Sam Gilbert. She told 60 Minutes last night: I was a stupid immature little teenager . . . [But] I dont think I owe anyone an apology other than Sam. The scandal involving the girl, 17, has engulfed AFL player manager Ricky Nixon, who is under investigation by the AFL Players Association for his alleged sexual involvement with the teenager. Nixon returned to Melbourne last night following a two-week trip to Ireland and Britain and vehemently denied television news reports that he was planning to stand down from his role this week, saying he would be at his Flying Start office today. He also unequivocally rejected suggestions that he was scheduled to check into a clinic to help resolve his personal issues. Channel Nine news had reported that he would stand down as a player manager and check into a clinic by the end of the week. The reports [on the Nine Network] are not true, Nixon told The Age. Apparently Im running for prime minister as well. The teenager showed Channel Nine text messages and emails from Nixon in which he told her what she should say to the press if she wanted their relationship to continue, warning that if she didnt 100 of his associates would want revenge on her for the rest of her life. He told her she should tell the media: I want to put on the record that there was no sex and no drug-taking. The network named the schoolgirl and showed her image on 60 Minutes last night. A media lawyer, who asked to remain anonymous, said last night the action appeared to contravene a court suppression order. Nine executive producer Hamish Thomson said: Nine denies that it contravened any laws. The Sunday Age yesterday reported claims that more than 80 Victoria Police officers had looked at the girls case file on the LEAP database. The Office of Police Integrity confirmed there was an investigation into alleged inappropriate use of the database.

Feeding those not there

Anger at state building code bill

By JASON DOWLING
CITY EDITOR
THE Baillieu government has been accused of watering down new building regulations designed to make public and commercial buildings more accessible to the disabled and those with limited mobility. Disability support groups and the state opposition say a bill before State Parliament broadens the scope for builders to avoid new national building standards designed to improve such elements as doors, lifts, corridors and toilets. The changes in the Victorian bill are considered so significant, the Baillieu governmentdominated Scrutiny of Acts and Regulations Committee will write to the minister questioning the wording of the bill. The committee is concerned that the definition in the new section 160B(7) may provide less protection to disabled people than the definition in the national premises standards, the committee found. Federal parliamentary secretary for disabilities and carers Jan McLucas also raised concerns. It is unacceptable the Victorian government has sought to back away from the nationally agreed commitment to improve accessibility to buildings for people with disability, she said. Both the federal and state bills allow exemptions or modifications from the new standards on the basis of unjustifiable hardship. But the state bill provides many more reasons a builder may argue on hardship grounds and removes a reference to the Disability Discrimination Act. Opposition planning spokesman Brian Tee slammed the bill as a back-door way to avoid the national standards. But Planning Minister Matthew Guy defended the bill, saying it met 2008 frameworks agreed on by the Coalition of Australian Governments and which were being implemented nationwide: This bill was drafted under the previous government and the disability access provisions of it are supported by the Baillieu government. Cath Smith, chief executive of the Victorian Council of Social Service, said it would upset thousands of people with disabilities if the Victorian legislation watered down the intent of the national standards. But Brian Welch, of the Master Builders Association of Victoria, said the new standards would be costly for builders.

Anissa Lau, left, and Elizabeth Chong keep the festival of Hungry Ghosts alive in Australia each year.

PICTURE: JOE ARMAO

A solemn family feast prepared for the hungry ghosts

By DANIELLA MILETIC
FOOD AND WINE WRITER

MELBOURNE

SOME feasts are meant to be solemn rather than joyous just ask Anissa Lau, who with her family has prepared an elaborate annual meal for the dead for more than three decades. As a young girl growing up in Hong Kong, Ms Lau remembers watching people during the Hungry Ghosts festival set fire to fake paper money, paper clothes and offer gifts of food to placate restless spirits, including those of deceased ancestors, who otherwise might take up residence in a living body. When Ms Lau married at age 19, her mother-in-law, a strong believer in maintaining the annual July meal, taught

FOOD AND WINE FESTIVAL 2011

her how to cook the banquet. Today, as part of the citys food and wine festival, Ms Lau will join chef Elizabeth Chong in telling stories about the foods of the festival of the hungry ghosts and other celebratory Chinese dishes that have been handed down from generation to generation. The session was picked to fit in with the festivals theme of the lost arts and will include demonstrations of dishes such

as Ms Laus roast duck and her pumpkin-and-pork belly stirfry dish. During the meal, the ghosts eat first but the food doesnt disappear and when an incense stick has burned through, it is time for the family to take their seats at the table and eat the meal. It is a feast, says Ms Lau, that is not meant to be a joyful one. I respect the tradition you can be happy, but mainly it is a meal for respect, she says. My mother-in-law showed me how to do it . . . and my daughter knows exactly how to do it too. Ms Chong, who has run a Chinese cooking school since 1961, says the story of the Hungry Ghosts festival (held on the 15th day of the 7th month of the Chinese lunar calendar)

is a story of compassion. In the festival of the Hungry Ghost we honour people who have died homeless, or they may have had misfortune and [their family doesnt] know where their bodies are, or they died overseas . . . and so their spirits roam. They havent found their spiritual home with their ancestors yet. The Mooncakes to Hungry Ghosts session at the Chinese Museum, which Ms Chong is hosting, will also include stories and food demonstrations from Chinese New Year and the Dragon Boat Festival. The Food and Wine festival, sponsored by The Age, ends on March 14.

TODAYS MELBOURNE FOOD AN OOD AND ND GHTS WINE FESTIVAL HIGHLIGHTS

Metlink Edible Garden. City Square on re s the corner of Swanston and Collins streets, ry. everyday until March 13. Free entry. Watch live cooking sessions. Red Meat Tell All. Kyneton Saleyards. 10am-1.30pm. Cost: $65. rds. -1.30pm. See inside one of the states beef and lamb processors. From Mooncakes to Hungry Ghosts. Chinese Museum 22 Cohen Place sts Museum, Place, Melbourne. 11am to 12.15 pm, 1pm to 2.15 pm and 3pm to 4.15pm. Cost: $25.00. Elizabeth Chong demonstrates the dishes Chinese Australians have had handed down to them through generations. Wine, Women and their Secret. World Restaurant and Bar, Shop 4, Building 2, Southbank. 6pm to 8pm and 8pm to 10pm. Cost: $75.00. Australian wine women match their recipes with wines from Victorias only mother-and-daughter winemaking team. Mozzarella & Co Scopri, 191 Nicholson St, Carlton. 6.30pm to 11pm. Cost: $75.00 dinner only, $110.00 with matching wines. Interactive demonstration followed by degustation dinner of handmade fresh Italian cheeses.

LINK

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OCTOBER 8, 2011

THE SATURDAY AGE 13

INSIGHT
Why did Abraham Papo die?

His fingers flew over the keyboard and the screen pulsed back at him, and the frustrations of his life appeared to melt into its elegant typography.

MICHELLE GRATTAN TALKING TAX PAUL McGEOUGH TURKEYS RENAISSANCE JESSICA GUYNN AFTER STEVE JOBS

BY NICK McKENZIE A G E I N V E S T I G AT I V E U N I T
ONE of the first things Senior Constable Rachel Dunkinson noticed as she stepped out of the police car was the blood. It was just after midnight on a warm summer evening in February 2009 and she was responding to a call about a fight at 59 York Street, South Melbourne, home to Madam Leonas, a brothel specialising in Korean and Chinese prostitutes. The blood was on the hands and face of a hulking Asian man holding a small iron bar, who said he had been robbed. He was standing next to a car with a smashed windscreen. As Dunkinsons partner ordered the man to drop the bar, the senior constable glanced through the smashed drivers side window and saw a Caucasian man who looked about 30, his face covered in blood, his clothes drenched red and his head slumped to one side. Dunkinson turned back to the Asian man and asked him whether he had used the bar to strike the drivers head. I dont know, he said. As she tried the door and discovered it was locked, the man inside lifted his head and began groaning. His mouth opened, and she saw it was filled with blood. Mate, can you talk? What is your name? Dunkinsons voice was now strained with urgency. The drivers head slum-

THE FLESH TRADE

ped backwards and she noticed his right hand twitching. She was running out of time. We are getting the ambulance right now. If you can hear me, we are getting you help. She reached through the smashed window, trying to find a pulse. Dunkinson then unlocked the door from the inside and her partner took over the search for vital signs. She turned back to the Asian man, who said his name was De Jun Zheng, and arrested him. He would not be told it was for murder until several hours later. About the same time, police confirmed that the man in the car was Abraham Papo, the 27-year-old son of a close-knit Melbourne Jewish family. Some of the circumstances of the killing appeared typical for a homicide squad inquiry: there were whispers of broken hearts Papo had fallen for a Korean student before his death and the man who delivered the fatal blows had criminal convictions. But in the hours after the crime scene was secured, something very unusual happened. An Australian Federal Police officer contacted the homicide squad to ask about the case. He explained he was from a special

taskforce investigating one of the most secretive and lucrative trades: the trafficking of mostly Korean and Chinese women to Australia to work as sex slaves. Six hours after Dunkinson arrived at the South Melbourne brothel, two uniformed police delivered what is known in policing slang as a death knock. The house they approached was only 30 minutes drive from the seedy patch of inner-city Melbourne that hosts Madam Leonas and one of the highest number of brothels per capita of any Australian suburb. But it could have been a world away. Deanna and Marco Papo chose to live in a suburb filled with football ovals, schools and young families to raise their three boys. They made their modest brown brick home a place where family and culture were valued, if not treasured. Here, neighbours call each other by first names, and follow the progress of each others kids and sports teams. The fateful knock on the door came on what was meant to be a joyous morning for the Papos. Marco, 67, a former watchmaker and jeweller, was due out of hospital after a near-fatal illness and Deanna, 59, and their boys Abraham, 27, Mark, 37, David, 35 had been looking forward to welcoming him home. Instead, Deanna opened the door to two grim-faced police officers. What followed remains a blur. None of it made any sense, she

says. Hami, her nickname for Abraham, was a boy with a quick, big smile that hid a serious streak. After being bullied at school as a shy and tall Jewish kid, he had blossomed into a young man popular with girls and who took great pleasure in helping others. Her Hami loved his family and collected personalised number plates and baseball caps. He also held down a regular job as a crowd controller. Why would he steam into a busy brothel and as alleged by the man who killed him swear, assault a man and steal several mobile phones, a landline and possibly some money from the brothels reception desk? If his aim was robbery, why did Papo, as Zheng later claimed, go to his car and get the iron bar that was wrestled from him and used to beat him to death? And why did Zheng, instead of calling the police, follow Papo out of the brothel and attack him and his car even after he had locked the doors and tried to drive away? The Papos couldnt prove it, but the more they learned, the more they began to suspect that Abraham was killed outside the brothel because he had discovered something terrible was happening behind its walls. OMICIDE squad Detective Senior Constable Matt Kershaw was working the graveyard shift on February 12 when, at 1.39am, he got the call about a suspicious death in South

Main: Abraham Papo. Inset: The crime scene in South Melbourne. De Jun Zheng walks through a brothel.
PICTURE: COURTESY FOUR CORNERS

Melbourne. Kershaws colleagues describe him as fair but tough, a popular and committed officer with a knack for making complainants feel they are being listened to, no matter how minor the crime they are reporting. After several years in uniform and as a suburban detective, he was posted to the elite homicide squad. The detective declined to be interviewed for this story, but some of his investigation can be reconstructed from parts of the police file. Fifty minutes after receiving the call, he arrived at the crime scene outside Madam Leonas and began a walk-through, looking for potential evidence and identifying the witnesses to be interviewed. The senior manager of Madam Leonas, Lin Lisa Gao, told Kershaw she was resting when she heard a commotion, ran to the reception and discovered the brothel had

been robbed of some of its phones. Gao said she dialled 000 and went outside to see Fatty (her name for De Jun Zheng) trying to stop a car from driving off. I hang up thinking that we have the offender and may not need to call the police. My intention was to retrieve any stolen items and that would be it . . . we are dealing with a brothel business and do not like police to attend, she said. According to Gao, Zhengs attack on the very slowly moving car was ferocious. Fatty [was] smashing the windscreen of the vehicle and the front driver side. Fatty was very angry . . . He was just raging and swinging his arms. Gao described Zheng as a friend/ client who was unemployed, although another witness, one of the brothels clients, described Zheng as Madam Leonas shop manager.

Zheng, whose injuries were mostly superficial, had his own story for Kershaw. He said he worked as a driver for the brothels prostitutes, receiving $10 for every drop-off. He said he knew Papo because he had visited the brothel two or three times before to book a lady. But on the night in question, Zheng said Papo had stormed in, sworn, punched him at least once in the face and grabbed mobile phones and, possibly, some money from the till. Zheng said he chased Papo to his car where he got the tyre lever, which Zheng said Papo used to strike him at least once after Zheng demanded the return of the stolen phones. Zheng said he wrestled the lever off Papo, and struck Papo with it at least once. When Papo dived into his car, Zheng said he was concerned he was retrieving another weapon. Therefore I hit him . . . again. I hit him again. Then I hear his car started to leave . . . I thought he was trying to escape. I said, you cannot run away . . . so I hit the windscreen with the metal stick. I cannot understand why he wanted to hit me because I am not
C O N T I N U E D PAG E 1 8

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NATAGE A013

18 THE SATURDAY AGE

OCTOBER 8, 2011

Why did Abraham Papo die?

F RO M PAG E 1 3

INSIGHT

COVER STORY Our sons death is my countrys unknown shame

an enemy to him, Zheng told Kershaw. According to a forensics report, Papo suffered tissue damage on both arms, a fractured forearm, a severely shattered jaw, a broken nose, fractured skull, broken ribs, crushed trachea and a large bilateral pneumothoraces, an injury normally suffered in car accidents, which involves the collapse of both lungs. It wasnt just the state of their sons body or smashed-up car that led the Papos to suspect another, more sinister, explanation lay behind their sons death. According to his brother David, in the hours before his killing, Abraham had driven to Oakleigh police station and told an officer he was gravely concerned for the welfare of a 20-something Korean woman he had dated named Kathy (not her real name), who was being threatened and had had her passport taken from her. He had told his mother he had to sort out a problem involving Kathy, but was more forthcoming with David: he told him Kathy was a sex worker who was in serious trouble. At 7.43am on February 12, about six hours after his brothers death, David signed a police statement saying that before an agitated Abraham had driven to South Melbourne, he had told him he had called Kathy and heard her crying and screaming in pain. Abraham told David that Kathy had been taken to Sydney and forced to work against her will. He said she was being raped and beaten and [told me] that he had to help her, Davids police statement says. He [Abraham then] said that a male had then got on the [Kathys] phone and threatened him. The guy had said that he would chop him up if he came near her. He told me he then rang an Asian guy that runs a brothel in South Melbourne and had an argument on the phone about Kathy. David also told police he had called Kathy on her phone and, in broken English, she had confirmed that she was with bad people, was being hurt and was unable to talk.

Waiting for justice: Abraham Papos parents, Marco and Deanna.

On a shelf next to an ever-burning candle were the partial ashes of the 27-year-old. Deanna remembers looking at Kershaws face as he sat at their kitchen table and feeling her stomach drop. We were waiting to hear hes been charged. But he [Kershaw] just looked at me. And I knew. The Papos were told there would be no charges arising from their sons death. (A letter Kershaw wrote to prosecutors in April 2009 states that given the explanation of Zheng . . . it was the belief of senior investigators that a defence of selfdefence may be open to Zheng.) The Papos were also forced to confront fresh information about their son. A small amount of crystal methamphetamine, known as ice, was found in Abrahams car and in his body after his death. (David says Abraham infrequently took party drugs.) Then there was the discovery that the quiet, pale Asian girl who had lived with Abraham in the Paposs house for a few months, often studying English books on his bedroom floor, worked in a brothel. To me, she was just a lovely girl. She knitted a top for me, a shawl, and she didnt dress the part, she didnt do the make-up, Deanna says. I look back on it now and I think that, even back then, Hami was trying to look after her. David Papo told police he gave his brother about $2500 shortly before his death after Abraham told him he was trying to help Kathy. When police searched Abrahams car at the crime scene, they found a neat bundle of money. It was about the same amount given to Abraham by David, casting doubt on the theory that

PICTURE: ANGELA WYLIE

Papo wanted to rob the brothel. The Papos were also left pondering one of the last things that Kershaw told them when he delivered his bad news: people convicted of sex trafficking often did longer sentences than those convicted of violent crimes. Deanna says the comment left them even more certain that Hamis death could shed light on a much bigger picture. It is to do with the girls, too. Its taken our sons life, but this is bigger than his death, as well. We realise that. OR a man who claims to derive his income by running a taxi service for brothels, De Jun Zheng lives very well. His friend, brothel manager Gao, told police he frequents the casino quite a lot, while a source who has seen his city apartment says it has expensive furniture and flat-screen televisions. The answer to how he can afford his lifestyle may reside in records archived in courts nationwide. They depict Zheng as something of a journeyman of the illegal sex trade. In late 2004, after being convicted in Queensland for knowingly participating in provisions of prostitution he flew to Adelaide where, in early 2006, he was arrested and charged with aggravated robbery and inflicting sexual servitude. A brief newspaper report on the police case against Zheng said it involved him imprisoning a student in a brothel as a sex slave, allegations that were dismissed by a judge in mid-2006. In November 2006, Zheng pleaded guilty to running an illegal brothel in Adelaide, was

N October 2009, several months after Papos death, Kershaw visited the Papo family home. If the detective had glanced into Abrahams bedroom, he would have seen a small bed, surrounded by posters, a collection of baseball caps, personalised number plates and sentimental collectables photos of Abraham grinning while on holidays, snaps of friends and holiday sunrises, some old cuddly toys. The Papos had left it how it was before he died, except for one thing.

fat. I wanted him to stop. I had tears in my fined $1196, and flew east. eyes. He looked at me but he didnt stop. His police record has not affected his He just kept going. ability to work in the brothel game. Nor The women were forced to work double has the fact that Zheng, along with his shifts, six to seven days a week, and engage associate Gao, are long-standing targets of two Australian Federal Police investigations in grotesque and unsafe sexual practices. All the money they earned was handed to of allegations they are members of a the receptionist at Madam Leonas. syndicate that traffics women from China, I never received any money from my Taiwan and Korea to Australia, where they work at No. 59 . . . I did not know how are forced to work as sex slaves. much money I made or how much money Two witness statements recently filed I had paid off my debt. I was just counting by the AFP in the prosecution of the only down the days. person so far charged in connection to Both witnesses identified Zheng as an these two operations (and who cannot be enforcer working for his boss, Gao. They named for legal reasons) reveal what also said they were coached about what to allegedly happens to women working for say in the event the brothel was raided, Zheng and Gao. Both allege that, while still and believed that if they caused trouble in Asia, they were tricked by the syndicate they would be deported or they or their to borrow money to obtain student visas families would be harmed. and fly to Sydney to further their educaAbout the time immigration officers tion. On arrival in mid-2009, they were raided Madam Leonas in late 2009, one of taken to an apartment in Melbournes the women was sent to central business district, work at a Heidelberg told they could not leave brothel. Both were then and ordered to work as moved to Sydney where prostitutes at Madam they worked at two other Leonas to repay their brothels connected to the debts. The man imprisonsyndicate. ing them was De Jun When the federal Zheng, who went by the police launched coname Kevin and had a ordinated raids on all the fearsome reputation. brothels last November, One of them said: [I Gao and Zheng had left was told that] Kevin Madam Leonas (it now [Zheng] had killed somehas a new name and new one at shop 59 . . . this Download The Age iPad to see more management). Six months made me very fearful of on The Flesh Trade. before, Gao applied for a him, even before I met Victorian government him . . . [Zheng] asked to licence a process that be called Lao Da, which requires an applicant and means big boss in I Today: Extended interview with their associates to have Mandarin. I was scared of Commander Chris McDevitt, AFP good repute with regard Kevin and realised his role Human Trafficking Unit. to character, honesty and was to enforce the rules of I Tomorrow: Extended interview integrity to operate the gangsters. with Senator Kate Ellis. the Candy Club brothel in When one of the Richmond. Gao refused to witnesses tried to flee the answer any specific quesapartment, Zheng blocked tions sent to her lawyer her passage. Kevin was by The Saturday Age, but responsible [for] making I Syndicates behind illegal brothels. issued a denial of any sure I could not be away impropriety. Her licence from the apartment alone was approved on May 10, 2010, and [even after] pleading with him to let me go renewed four months ago. . . . I started feeling worried and very, very scared. Zheng also allegedly sexually assaulted HE coronial inquest on the death of this witness, watching her as she showered Abraham Papo was scheduled as a and, on other occasions, fondling her brief summary hearing in July, breasts. meaning no witnesses would be Yet Zhengs unwelcome advances were called, Zheng would likely be nothing compared with what unfolded identified as the man who killed Papo, the behind Madam Leonas walls. One witness decision not to charge him acknowledged described her first encounter with a client: and the file closed forever. It was hurting me so much . . . but I A few months before the inquest, The couldnt push him away because he was so Saturday Age which came across the

iPad edition Age online

Sunday Age

case while researching human trafficking began a joint investigation with the ABCs Four Corners into Abraham Papos death, passing on extensive information (including Zhengs criminal history and the fact the AFP held significant information about him) to the Papo familys recently appointed barrister, prominent human rights advocate Julian McMahon. On the eve of the summary inquest, McMahon wrote to State Coroner Jennifer Coate, requesting an immediate adjournment and a new investigation. Papos extreme injuries, McMahon said, were not consistent with Zhengs account of selfdefence but consistent with Papo being maliciously beaten to death. McMahon also said that police had not done enough to answer what the barrister claimed was a critical question: was Papo killed because he had sought to help Kathy escape the clutches of a criminal syndicate involved in the trafficking and abuse of women? On July 18, Deanna, Marco and David, along with a family friend, watched as Judge Coate adjourned the hearing and requested that McMahon ask state authorities to consider the need for a fresh investigation. Victoria Police recently began making fresh inquiries about the case, including (and for the first time) seeking access to anything relevant held by the federal police. The Papos have also been told that, for the first time, Kathy has been located by policing agencies and is assisting authorities. Deanna and Marco want to see answers to some of the broader questions arising from the case, including why regulators and policing agencies are not sharing more information to combat suspected criminals in the brothel industry and deny licences to those implicated in offences such as sex slavery. While the Papos hope the injustice of their sons death will be addressed, they also believe it could be the source of a legacy. If he failed on that night to help Kathy, Abrahams death might yet help save other women. Our son Abraham was loud with laughter, tall and handsome, with a smile to light up a room, Deanna recently wrote. Our sons death is my countrys unknown shame: the trafficking of women to become sexual slaves. I have come to learn this industry is a blatant law unto itself. We wait for justice. How does this happen in Australia? The Four Corners program Sex Slavery airs on Monday at 8.30pm on ABC1.

Make the most of Saturday.

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theage.com.au
SPECIAL INVESTIGATION NICK McKENZIE

Abraham Papo was 27, handsome and the beloved son of a closeknit Melbourne family.
So why did he die a terrible death, savagely beaten outside a South Melbourne brothel and left with injuries so severe he looked like a road crash victim? And why has no one ever been charged over the killing in February 2009?
New evidence suggests that Abraham Papo died trying to rescue a woman he loved, a woman trapped inside one of Australias most secretive and lucrative illegal industries: the trafficking of mostly Korean and Chinese women to Australia to work as sex slaves. An investigation into his death by The Saturday Age and by the ABCs Four Corners has exposed an international syndicate that allegedly supplies trafficked women to brothels in Sydney and Melbourne to help meet the growing demand of Australian men for sex with Asian women. Statements given by women to police detail how they were tricked by the syndicate while still in Asia into borrowing money to obtain student visas. Flown to Melbourne, they were put in an apartment, threatened and ordered to work for a brothel madam to repay their debts. The women allege they were forced to work double shifts, six to seven days a week, and engage in grotesque and unsafe sexual practices. All the money they earned was handed over. And some of the women are working in brothels regulated or licensed by state authorities in NSW and Victoria. Now the Papo family wants justice, not just for Abraham but for the women still caught in the illegal sex trade.

The man who changed mankind INSIGHT

RICHARD BRANSON

The entrepreneur I admire most. FORUM

Is Paris still IT?

LIFE&STYLE

Was our son killed trying to expose this sordid business?

Marco and Deanna Papo are searching for answers after PICTURE: ANGELA WYLIE their son Abrahams violent death.

THE FLESH TRADE

The first of an exclusive series of reports. INSIGHT, iPAD and ONLINE

Corporate fat cats cash in

BY IAN McILWRAITH AND PHILIP WEN
BOSSES of Australias largest companies enjoyed pay rises almost three times the rate of inflation and equivalent to more than twice the average wage in the past year. A Saturday Age analysis of company reports filed in recent months by most of the countrys 100 largest ASX-listed companies shows that the median increase in base pay for chief executives for their latest financial year was about 9 per cent up from $1.47 million to $1.61 million. Add in the chief executives short-term cash bonuses and the cash-in-pocket rises to $2.61 million, up 5 per cent. In dollar terms, that means they picked up cash gains of about $130,000 a year. The Australian Bureau of Statistics most recent figure for the annual average wage is about $53,000. It estimates that wages have risen by 4.7 per cent for males and 4.1 per cent for females over the past year. Australias consumer price index at June 30 rose by 3.6 per cent, with the impact of higher fruit and petrol prices. The Reserve Bank this week estimated that inflation was now running closer to its preferred range of 2 to 3 per cent, excluding any impact of carbon tax proposals. Among the ASX 100, the top five best-paid chief executives last financial year were Westfields Frank Lowy ($15.96 million), Rio Tintos Tom Albanese ($12.75 million), ANZs Mike Smith ($10.86 million), BHPs Marius Kloppers ($10.84 million) and Westpacs Gail Kelly ($9.59 million). Executive and board remuneration will soon come under further scrutiny from shareholders, whose investments have been hit by collapsing markets, as this years annual meeting season begins. Shareholders will say: We know its tough, we understand its tough, but should we be the only ones who hurt? You still get bonuses . . .whereas I only get my bonus when the sharemarket is performing well, warned Ann Byrne, chief executive of the Australian Council of Superannuation Investors, the group that represents industry super funds. Total remuneration of executives, which includes the estimated value of share packages that may take several years to earn, showed a median decrease of 1.3 per cent, from $3.57 million to $3.52 million in the latest financial year. That decline most likely reflects falling share prices affecting the value of their packages, and tougher trading conditions that meant executives failed to clear all of the hurdles needed to achieve maximum pay. The Saturday Age analysis differs from an annual chief executive pay report compiled by ACSI, and released last month. The ACSIs report, based on the payments to executives of the top 100 companies in 2010, said that median fixed pay of executives rose only slightly from $1.81 million to $1.82 million. The ACSIs fixed remuneration measure includes superannuation, long service leave and miscellaneous short-term perks as well as base pay. The ACSI also singled out the five best-paid and five lowest-paid chief executives to analyse whether their pay reflected their companies performances. Mr Lowys $14.3 million in fixed pay and bonus and the $11.2 million earned by former Leighton Holdings chief Wal King were criticised by the ACSI for being insulated from the effects of performance.

BUSINESSDAY

Fight to keep boy out of jail

NEWS 3
ISSN 0312-6307

Top cats on a tin roof World on brink of disaster: bank boss

WEATHER
MELBOURNE Shower or two 12 21 BALLARAT Shower or two 7 18 BENDIGO Partly cloudy 8 21 GEELONG Shower or two 8 20 HORSHAM Partly cloudy 7 21 MILDURA Mostly sunny 8 23 SALE Shower or two 8 20 WARRNAMBOOL Showers 10 18 WODONGA Partly cloudy 9 21 Details PAGE 25

MELBOURNE DAMS

A YEAR AGO: 35.3% AGO: 47.5%

63.4 48.3%

ODD SPOT
Inmates at a Christchurch prison were caught highly intoxicated after drinking a toxic home brew they concocted out of hand sanitiser and sugar-based products. The sanitiser was given out to help prevent the spread of disease after the February earthquake.

INDEX
ARTS PAGE 24 CLASSIFIEDS BUSINESSDAY 22-40 COMICS LIFE&STYLE 49 CORRESPONDENT PAGES 9-12 CROSSWORDS LIFE&STYLE 48,49 EDITORIAL, LETTERS PAGES 20, 21 FORUM, OPINION PAGES 20-23 TELEVISION LIFE&STYLE 50,51 TRIBUTES BUSINESSDAY 38,39 WEATHER PAGE 25

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True love An online dating success story OPINION

Pair wins on the line SPORT

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WEATHER Shower or two developing. 7-16

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INC $1.70 GST

Austins urgent plea for funds

By JULIA MEDEW
HEALTH EDITOR
AUSTIN Hospital executives begged for more resources to make their emergency department safe last year after patients were treated in chairs because of a shortage of beds. In a plea to state politicians that has not been acted on by the government, the hospital asked for an urgent $26.8 million redevelopment to double the size of its emergency department because it was not coping with increasing demand. The May 2010 proposal said the emergency department was treating about 16,500 more patients a year than it was built to manage, blowing out waiting times for care. This means that at times of high patient activity patients are being managed in waiting room chairs because no ED [emergency department] treatment spaces are available, the document said. It also results in extended waiting times for ambulances to unload patients and queueing of ambulance trolleys in corridors to wait for an ED treatment space to become available. The proposal said the hospital expected to deal with 85,000 emergency cases a year by 2015 and 98,000 by 2020 because of a growing and ageing

Licensed prostitution operators implicated in human trafficking

Legal brothels sex slavery links

THE FLESH TRADE
By NICK McKENZIE and MARIS BECK
LEGAL brothels in Victoria and New South Wales are operating unchecked despite police investigations implicating them in human trafficking, sex slavery and organised crime. Two Australian Federal Police investigations Operations Elixation and Raspberry have identified at least three Melbourne brothels and two in Sydney linked to an international sex slavery ring. The syndicate allegedly convinces Asian women to fly to Australia for study, and then forces them to work as sex slaves in Sydney and Melbourne. A syndicate member, De Jun Zheng, was also involved in the 2009 killing of Melbourne man Abraham Papo, 27, outside a brothel linked to sex trafficking. Evidence suggests that Mr Papo was killed after he tried to help a Korean prostitute he thought was being harmed or held against her will by the syndicate in Sydney. Mr Papos parents, Deanna and Marco, have called on state and federal authorities to do more to crack down on brothels linked to sex trafficking. The state authorities responsible for approving legal brothels have taken no action despite court documents in August detailing federal police allegations that the brothels or their managers were involved in organised crime. After a joint investigation by The Age and the ABCs Four Corners, it can be revealed that the brothels targeted by the police operations include the Candy Club in Richmond, which is licensed by the Victorian government, and the Five Star in Woolloomooloo, Sydney, which operates with local council approval. In addition to the legal parlours identified in AFP operations, several other legal brothels with alleged links to organised crime are operating unchecked. They include: I Inner-city Sydney brothel Nadira, which specialises in Korean prostitutes and is closely linked to the Comancheros outlaw motorcycle club and senior Asian organised crime figures. I Regarding House, a brothel in the Melbourne suburb of Heidelberg, where a sex slave

Wallabies captain James Horwill celebrates after yesterdays win over South Africa. Below: Horwill in a line-out. PICTURES: REUTERS, GETTY

From last Thursdays Age.

population in Melbournes north-east. The current demand from emergency department attendances now far outstrips the physical capacity of the ED with no foreseeable reduction in activity or capacity to manage growth. This will create major challenges for Austin Health to continue to provide safe and effective care, necessitating the need for an urgent redevelopment, the proposal said. Last week, The Age revealed that an Austin emergency doctor believed the department was now so overwhelmed and unsafe that he feared being sued for inadequate care. In an email to hospital executives last month, the doctor said a patient suspected of having a heart attack walked out after waiting 612 hours to be seen. In response to the email, hospital executive Mark Petty wrote to the doctor and other staff, saying all recent additions

Four Corners: Sex Slavery, 8.30pm tonight, ABC 1. See The Age iPad and theage.com.au for videos and graphics as part of our special investigation into the sex slavery trade. To tip off the AFP about sex slavery or human trafcking call 131 AFP.
The rear of the Candy Club, whose manager, Lin Gao (top right), faces accusations.
allegedly worked in 2009 and which operates from premises whose owner is linked to a Chinese crime syndicate that runs dozens of illegal brothels. I 39 Tope Street in South Melbourne, from which authorities removed two women in late 2008 due to sex slavery allegations which were later denied by the licensee. Senior police sources said the links between organised crime or sex trafficking syndicates and legal brothels highlight a need for stronger regulation, better information sharing between police and regulators including across state borders and a possible need
PICTURE: MAL FAIRCLOUGH

Continued PAGE 2

for uniform prostitution laws across Australia. An AFP spokesman told The Age that the agency continually explores ways to increase the sharing of information and collaboration in the illegal sex industry. Since 2003, the AFPs human trafficking teams have under-

taken more than 300 investigations and assessments of trafficking allegations, and identified 181 victims, including 147 women forced to work as sex slaves. Senior state police sources in Victoria and NSW acknowledge that the policing of organised crime in the legal brothel sector is patchy and that the regulation of brothels in both states is often woeful. Operation Raspberry has gathered testimony from two witnesses who allege that the licensed manager of Richmonds Candy Club, Lin Gao, is part of a syndicate that in 2009 forced two women to work as sex slaves at two other Melbourne brothels, Woolloomooloo brothel Five Star and a second Sydney brothel, which is now under new ownership. In witness statements tendered in August to a Melbourne court, two Chinese women alleged they were forced to engage in unsafe sex practices in these legal brothels and work up to seven days a week, servicing dozens of men. Every dollar they earned was allegedly returned to the syndicate that sent them from Asia to Australia. I did not know how much money I made or how much money I had paid off my debt. My mind was blank. I was just counting down the days, one of the witness statements alleges. The statements identify Ms Gao as an alleged big shareholder and decision maker connected to the trafficking syndicates Australian operations, although she told The Age through a lawyer that she is not involved in any impropriety. The AFP court documents contain a large amount of information implicating Ms Gao and several of her Sydney and Melbourne associates in sex trafficking or other crimes, but only one syndicate member has so far been charged. At least three of these associates are still involved in running legal brothels in Sydney or Melbourne. One of the few brothels in Victoria against which regulators are attempting to take disciplinary action is Club 234 in Richmond, which remains open. According to court documents, the brothel operates in premises owned by Boris Kogan,

Great defenders: Wallabies charge into semi-final

By GREG GROWDEN
RUGBY CORRESPONDENT WELLINGTON
THOUSANDS of jubilant Australian supporters joined in a rousing rendition of Waltzing Matilda that echoed around a Wellington stadium last night as the Wallabies desperately held on to beat the Springboks and ensure a World Cup semi-final encounter with New Zealand next Sunday. The green and gold armys excitement was justified the Wallabies were forced to defend courageously for most of the night because they were unable to command any territory or possession. South Africa, the defending World Cup champions, came close to scoring on numerous occasions, but the Wallabies defence somehow held firm. Australias youngest player James OConnor showed he was up to the pressure of a match-winning goal kick, slotting a 40-metre penalty shot in the 72nd minute that enabled the Wallabies to regain the lead at 11-9. Australia held on for the final eight minutes to force the Springboks to depart for South Africa this morning. The Wallabies had countless heroes, in particular their flanker David Pocock, OConnor, halfback Will Genia and captain James Horwill. They were able to overcome their playmaker Quade Cooper being way off his game, with the player tagged New Zealand public enemy No. 1 appearing to be affected by the endless booing every time he touched the ball. Horwill turned the air blue when he beckoned the team together after the final siren, and in the huddle was heard on the TV microphone saying: Im so f---ing proud of all of you. Shortly after Horwill composed himself to

iPad edition theage.com.au

I

Go to theage.com.au and The Age iPad app for comprehensive and interactive World Cup reports, and three pages in Sport.

Continued PAGE 2

praise the Wallabies exceptional level of courage. That was such a huge effort, which required everything that we had. We knew that South Africa were going to come back, Horwill said. We had some real issues during the second half in clearing our ball, and they put us under a lot of pressure, but we somehow held on. Im really, really proud of how all our boys fought and dug in. The Springboks did not score until the 39th minute courtesy of a try from Morne Steyn. It was the longest they had ever waited before their first score in a Rugby World Cup match. The Springboks were striving to equal Australias record of 12 consecutive World Cup match wins, but instead the Wallabies advanced to a semi-final showdown with the All Blacks, who beat Argentina 33-10 in Auckland last night. France and Wales will play off in next weekends other semi-final. There have already been casualties in the South African camp. Immediately after the loss, controversial Springboks coach Peter de Villiers said he was quitting. With AAP
ISSN 0312-6307

WEATHER
MELBOURNE Showers BALLARAT Showers BENDIGO Shower or two GEELONG Showers HORSHAM Shower or two 7 1 2 5 1 16 11 15 15 16 MILDURA Mostly sunny 5 18 SALE Showers 3 16 WARRNAMBOOL Showers 7 14 WODONGA Partly cloudy 4 16 Details PAGE 21

MELBOURNE DAMS

A YEAR AGO: 35.3% AGO: 47.6%

63.5 48.3%

ODD SPOT
A Swiss drink-driver tried to park his car in a river after mistaking a slipway for an underground car park ramp in heavy fog. Peter Thaler, 42, abandoned the car and walked home but was arrested the next morning when he returned to collect it, while still drunk.

INDEX
ARTS PAGES 16, 17 CLASSIFIEDS BUSINESSDAY 14 COMMENT & DEBATE PAGE 13 EDITORIALS, LETTERS PAGE 12 LAW LIST PAGE 19 MINDGAMES OBITUARIES SHIPPING TRIBUTES WORLD PAGE 20 PAGE 20 BUSINESSDAY 4 PAGE 19 PAGES 9, 10

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Online dating is a symptom of the time-poor, work-focused modern society. You reach an age when you cant party at nightclubs any more. I was at that age. Matt Smith PAGE 13

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Austin in urgent funds plea Report flags ATMs in club car parks
From PAGE 1
to the department to boost capacity had been swamped by increasing demand. He said he was trying to get more resources. Almost all my time is spent worrying about ED, planning for ED issues and lobbying for ED expansion, he wrote. However, when asked about the state of its emergency department and the proposal last week, an Austin spokeswoman said it had mechanisms in place to deal with demand pressures and that the proposal was never put forward as a formal submission, but rather tabled for discussion with the Health Department. We are currently working with the department cooperatively towards longer-term proposals for the development of the Austin ED. In the short term, Austin has received $1 million for the expansion of our ED an extra consulting room, resuscitation bay and extra fasttrack treatment spaces. Work is anticipated to commence next January, she said. State Labor MP for Ivanhoe Anthony Carbines said the Austin gave him the proposal before last years election while it was also seeking $45 million to complete the Olivia Newton-John Cancer Centre. While Labor committed only to the cancer centre in its election campaign, Mr Carbines said the Coalition government needed to acknowledge the emergency department was now in desperate need of redevelopment. Theres clearly enough pressure for doctors to feel the need to speak up about it, he said. Health Minister David Davis refused to say whether he would fund the proposal.

Clubs site pulls pokies loss truth

By ANDREA HAYWARD and SARAH MALIK
CLUBS Queensland has sought to distance itself from claims made on its website that clubs could expect a drop of between 10 and 20 per cent in revenue as a result of the governments poker machine reforms. South Australian independent senator Nick Xenophon, who, along with Tasmanian independent Andrew Wilkie, is driving the governments plans to have poker machine users preset limits on how much they will gamble, said Clubs Australia had been caught out by documents that appeared on the Clubs Queensland website. The organisation should apologise for what had been revealed as a campaign of misinformation on pokies reforms, Senator Xenophon said yesterday. He said he was tipped off about the documents on the Clubs Queensland website by a News Ltd journalist on Friday, and said they had since been taken down from the site. Used at a July conference in Cairns, the documents revealed that clubs expected a drop of between 10 and 20 per cent in revenue as a result of the reforms, rather than the 40 per cent the clubs industry had since stated, Senator Xenophon said. The poker machine industry owes an apology to Australian politicians and to the media for this campaign that has been based on a series of deceptions and misleading information, he said. Im not too sure the person whos responsible for putting these documents online will have a job on Monday with Clubs Australia. But Im very grateful to them for exposing the truth . . . this was never meant to be seen by the public. The documents also outline ways clubs can get around proposed restrictions on the use of ATMs in venues, including using them in car parks, Senator Xenophon said. To have ATMs in car parks show these jokers know no shame in circumventing sensible reforms, he said. Clubs Queensland chief executive Doug Flockhart said the report referred to by Senator Xenophon had not been commissioned by Clubs Queensland or Clubs Australia. Mr Flockhart said the fact remained that crucial data had forecast a reduction in gaming profit of 33-44 per cent, which would devastate local clubs. Deutsche Bank, one of the worlds leading international banks, has predicted a drop in revenue of 30 to 40 per cent, he said. Mr Flockhart said the Deutsche Bank calculations showed why there had to be a trial of the governments planned mandatory precommitment technology. Clubs Australia has written to the federal government, offering its support and outlining conditions for a trial of mandatory pre-commitment technology in one state or territory. Chief executive Anthony Ball said that, despite Mr Wilkies claims, there was no evidence to suggest the technology would reduce problem gambling. The suggestion that clubs, hotels and casinos be told to spend $3 billion on technology that has never been tested let alone proved reveals the complete stranglehold Andrew Wilkie has on the federal government, Mr Ball said yesterday. We have a farcical situation where Andrew Wilkie has made clear that the federal government must support his proposed legislation regardless of the findings of any trial. AAP

Brothels linked to slavery

From PAGE 1
who has substantial links to Russian organised crime. The licensee of Club 234, Anthony Fletcher, has denied impropriety and is fighting the claims he breached a licence condition by failing to stop Mr Kogan being involved in the brothel business. A 2010 affidavit from Victorias Business Licensing Authority and tendered to VCAT states: The said police information report [from 2004] states that Boris had purchased the brothel at 234 Coppin Street Richmond and he specialises in introducing Russian prostitutes into brothels. The report further states that Boris had paid $600,000 for the premises and is now looking for a licence holder to front the brothel for him. Consumer Affairs Victoria told The Age that if it obtained solid, court-admissible evidence of brothel licensees or approved managers participating in serious or organised criminal activities it may apply to a court to determine if there are grounds for taking action against licensees. With TOM REILLY, ANNE DAVIES

Uncertain week for Gillard Last-minute fine-tuning as as Rudd waits in the wings carbon price vote nears
JULIA Gillard faces a parliamentary week that will deliver one triumph but contains more than the usual political risk. If the government is defeated on its Malaysia people-swap legislation on Thursday, that will overshadow the passage through the lower house of the carbon legislation the previous day. Both Labor and the opposition will be working frantically on West Australian National Tony Crook, whose vote appears to be the crucial one on the crossbench (the government is confident it has independent Bob Katter). Though there has been plenty of time to do so, Crook said last night he had not yet reached a decision. Crossbenchers in the spotlight like to play hard to get. If the bill was defeated Gillard would be humiliated and caucus members would be critical of her

MICHELLE GRATTAN
ANALYSIS
judgment in persisting with legislation that was anyway doomed in the Senate even if it passed the House. If Crook cant be persuaded, Gillard has the option of avoiding a vote by withdrawing the legislation. John Howard did that once when facing a loss after a senator said she would cross the floor on a border protection bill. But leader of the House Anthony Albanese last night seemed set on a vote. On the other hand, if Gillard gets the legislation, Tony Abbott will be embarrassed but that wont stop him knocking over the bill in the upper house.

While the climate and asylum seeker bills will dominate centre stage, all eyes will be on the man in the wings. Kevin Rudds high profile last week, combined with comments from former Labor power broker Graham Richardson, led to fresh and somewhat fevered leadership speculation. Rudd supporters still insist nothing is imminent, though the media talk itself feeds into the volatility and uncertainty, with whatever good or bad movement comes in the next poll affecting the caucus mood. There is some wish in the Rudd camp that the former PM would reduce his activity a notch. The aim is to have the caucus get used to the idea of Rudd Mark II. Seeing the Foreign Minister all guns blazing, everywhere, could just bring back some bad memories of Rudd as he was.

By MICHELLE GRATTAN
POLITICAL EDITOR
THE government has done some last minute fine-tuning to its carbon price scheme before it is passed by the House of Representatives on Wednesday. Getting the legislation through the lower house will be a big milestone for the government, but the fate of Labors bill to validate the Malaysia people swap hangs in the balance, with West Australian National Tony Crook still to say how he will vote. Mr Crook, who had talks with Prime Minister Julia Gillard and immigration spokesman Scott Morrison last week, is to have more discussions with both sides before Thursdays debate. Leader of the House Anthony Albanese said yesterday the governments intention was to bring the bill to a vote that day,

although we dont have the numbers to gag debate on bills. Even if the bill passes it will be defeated in the Senate. In two significant changes to the climate plan, the aviation industry has asked to come directly under the carbon price and, in a concession that will help local government, all small rubbish tips will be exempted. Climate Change Minister Greg Combet said he had spoken last week to independent MPs Tony Windsor, Rob Oakeshott and Andrew Wilkie whose votes will ensure the legislation passes the House just to make sure we were on track. They are continuing to discuss some issues about regulations to be made under the scheme. The government is also increasing its political pressure on Tony Abbott over legislation, associated with the carbon

price, for a $300 million package to help the steel industry. The opposition is against the initiative, but the measure is likely to get through eventually with the reluctant support of the Greens. A number of large fuel users, especially Qantas and Virgin, have said to the government they would prefer to be directly under the scheme rather than, as initially planned, pay the equivalent carbon price through the fuel taxes. The change will be made through opt-in arrangements for large fuel users. Most eligible companies would already be paying the carbon price but there are about 20 more companies for which it would make commercial sense. Opting in will give these firms benefits under the carbon scheme, including access to credits under the carbon farming initiative.

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THE AGE TUESDAY, OCTOBER 11, 2011

11

FOCUS

NEVER A GAME
Arson, a killing, sex slavery. This is the reality of Melbournes sex industry. Maris Beck reports.
Main: A man leaves Top on Tope shortly after fire broke out at the premises. Above: Lin Gao.
PICTURE: FOUR CORNERS.

S SMOKE enveloped the brothel across the road from his Tope Street shop on August 13 last year, a South Melbourne fruiterer who counted many of the women working there among his customers frantically dialled 000. In doing so he set in train an investigation that escalated to a magnitude neither he nor the firefighters who responded to his call could ever have anticipated. Brigade commander Wayne Garrard, one of the first on the scene, described the fire at the Top on Tope as dramatic flames surged through the roof, smoke engulfed the citys inner south but otherwise unremarkable. As no one was injured, it seemed tragedy had been averted. There was an abundance of bedding to fuel the blaze thought to have been started by a fan heater on the top floor and it ignited quickly. But as arson detectives worked on the site, a different picture started to emerge. What they discovered would shed light on the brutal dealings in Melbournes brothel scene, exposing an intricate network of vendettas, alliances and rivalries linked to a turf war between alleged crime syndicates in the citys lucrative sex trade. A year later, it is clear that the fires real significance lies in what the investigations reveal about the states regulatory agencies and the lack of oversight that enables brothels to renew their government licences each year despite the accumulation of police intelligence on Victorias licensed brothel industry, sex slavery raids, suspected firebombings, a killing and widespread standover tactics. Someone is making a lot of money and it is not the women selling the sex. In this world, friendship and enmity are often entwined, and relationships turn sour over sex and money. So it seems the friction that sparked the South Melbourne fire may have begun years ago among

THE FLESH TRADE

enemies who once were friends. Top on Tope, known for its beautiful Korean women, was only one of many brothels in South Melbourne, which contains one of the busiest and most profitable brothel strips in the country an area where competition for custom has always been fierce. One of the managers at Top on Tope was Mae Ja Kim, also known as Mimi. Detective Leading Senior Constable Glen Hatton, of the arson squad, says investigators have now ruled out electrical faults and say the blaze was not an accident. Nor was it likely to be an insurance scam the costs of a recently added extension meant owners had lost money because of the fire. But the owners were not the only ones who lost out when Top on Tope one of Melbournes busiest brothels was boarded up and closed. Police believe Kim was well connected in the area, with an interest in the brothel next door, 39 Tope Street, also known as Oriental Dolls, and stakes in a string of other brothels around Melbourne, to which she introduces women but does not appear on the books. Of all the city brothels, sex industry sources say Top on Tope, with its prime location near the casino, and its beautiful women, was on the top tier. If anyone wanted to hurt Kim, says Hatton, they would have done it by burning the place down. The question is, who would want to and why? A witness told police a man in a puffy ski jacket and a cap was seen nearby at the time of the blaze. Now, a joint investigation between The Age and Four Corners has unearthed

another crucial piece of evidence grainy closed-circuit television footage that shows a man in a cap and light-coloured jacket walking down the hallway of Top on Tope shortly before the fire. He walks out of frame and hurries back a while later, as the flames flare behind him. Arson detectives are investigating the involvement of De Jun Kevin Zheng. Zhengs journey, through numerous legal and illegal brothels in South Australia, Queensland and Victoria, also implicates Victorian regulators, who have failed to stop his involvement in the states licensed premises, despite more than five years of documented criminal activities. Zheng, also known as Fatty or Fat Boy, has been linked to illegal brothels interstate and was charged with keeping a woman as a slave in his Adelaide brothel. The case didnt proceed, but Zheng has bragged to an associate that he intimidated the prosecution witness. He is again under investigation for sex slavery and has been questioned by federal police. In February 2009 he also bashed to death 27-year-old Abraham Papo outside the South Melbourne Top on Tope brothel after Papo tried to help his girlfriend, a Korean prostitute and alleged sex slave. Zheng has claimed self-defence and has never been charged. A federal police witness told Melbourne Magistrates Court in August that Zheng forced her into prostitution at two licensed Melbourne brothels. One of the brothels she named was Madam Leonas, which was then managed by Lin Gao, also known as Lisa. (That address is now licensed to a different sex work provider and the licensee of Madam Leonas has moved location.) In a sworn statement, the witness described mould growing on the walls at Madam Leonas, which was also infested with mice.The first time she was there, she said: I felt like I was a corpse walking into sex work,

that I was going down the hall without a soul. She said wanted to vomit so many times, she started keeping tissues next to the bed when she was with clients. The witness said she lived in an apartment with other women, and that Zheng prevented her from leaving it. She described him as tall and strong with a shaved head and looked like a very rough, angry, unfriendly kind of person. He usually spoke to me with an angry face, which made me feel scared.

Of all the city brothels, sex industry sources say Top on Tope, with its prime location near the casino, and its beautiful women, was on the top tier.

She said Zheng sometimes watched her while she was in the shower and on one occasion she woke to find him groping her. She described another woman in the brothel crying after being submitted to rough anal sex. The witness said the woman did not receive medical attention and told her that this job is not for humans. The witness was interviewed after Madam Leonas was visited by federal police and immigration officers in September 2009. She told police that Gao had taken her to another licensed brothel, Regarding House, in Heidelberg, after she was questioned. Yet despite the raids and despite her witness statement made in November 2010, which became public in court in August, both Regarding House and Madam Leonas remain open for business.

And in May 2010, less than six months after Madam Leonas was visited by authorities, the governmentregistered manager, Lin Gao, was granted a full licence to run the Candy Club brothel in Richmond. Regarding House is also one of many sites police believe are connected with an illegal-brothel syndicate allegedly operating across the northern suburbs. Six people have been charged over alleged bribery and illegal prostitution following raids across the northern suburbs in November last year, including a council worker who pleaded guilty to accepting bribes in August and alleged brothel kingpin Xue Di Jenny Yan, who formerly owned the property that hosts Regarding House in partnership with the current licensee. The Ages investigations have revealed that a string of licensed brothels that have repeatedly drawn attention from police have yet to face any consequences from regulators, including the lead regulator, Consumer Affairs Victoria. In November 2008, federal police removed two Korean women from Oriental Dolls following allegations of sexual slavery, allegations that were denied by the licensee when he was contacted by The Age. After the police raids, the brothel stayed open. The police case did not proceed, but the women were accepted into the federal governments support program for victims of trafficking. The repeated raids along with the 51 trafficking victims rescued in Victoria since 2003, most of them from licensed brothels have sparked little action from state regulators, although regulators accompany police on many operations involving brothels. A spokeswoman for Consumer Affairs Victoria says serious criminal offences such as under-age sex work, sexual servitude, drug-related offences or immigration offences are referred to state and federal law enforcement bodies.In circumstances where Consumer Affairs Vic-

toria obtains solid, court-admissible evidence of brothel licensees or approved managers participating in serious or organised criminal activities, CAV may apply to the Victorian Civil and Administrative Tribunal for an inquiry to determine if there are grounds for taking action against licensees. The spokeswoman says Consumer Affairs acted on all received intelligence but would not jeopardise ongoing law enforcement investigations. A number of the premises in question are the subject of ongoing inquiries and it would be inappropriate for Consumer Affairs Victoria to make any comment that could jeopardise these inquires. Police superintendent Pauline Kostiuk, who heads a new intelligence-sharing committee between relevant agencies about illegal brothels, says law enforcement has been hampered because little information was shared between agencies. There [has been] no provision for that to happen. I think they would benefit from a closer relationship and data-sharing. Detective Sergeant Murray Aldred, one of Victorias most experienced police officers involved in investigating the sex industry, recalls watching intelligence files on brothels shredded when the vice squad was disbanded in 1999. When he took over the crime desk in 2006, he tried to rebuild some of those files, but was working mostly by himself. He says the state governments intelligence-sharing taskforce would improve the situation only if it was given enough resources. One brothel owner told The Age he voluntarily photocopied sex workers passports and sent them to the Immigration Department. He believes this is uncommon but should be mandatory, as it would help authorities detect illegal immigration and investigate possible cases of sex trafficking. The Coalition criticised the current regulatory system when it was in

opposition, and after taking office recommitted to putting police back in charge of brothel regulation. Before last years state election, the opposition released its plan for Consumer Affairs role in regulating the sex industry: The legalisation of prostitution in Victoria was intended to drive out criminal elements associated with the industry. Clearly, this has not occurred. Street prostitution continues openly, while unlicensed brothels and escort agencies advertise in newspapers, seemingly without fear of prosecution. Sex slavery and other human rights violations have occurred in Victoria. A government spokeswoman says laws will be introduced shortly to make Victoria Police the lead agency in enforcing sex industry laws affecting illegal brothels. But for now, the licensees keep ticking over, in one name or another, and the discreet doorways stay open as regulators fail to act. One exception is the charred entrance to Top on Tope. Police investigations into identifying who burnt it down are continuing. Anyone with information should contact Crime Stoppers 1800 333 000

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Watchdog versus watchdog

Ombudsman in stinging attack on OPI
By DAVID ROOD
STATE POLITICAL CORRESPONDENT
THE state Ombudsman has launched a stinging attack on Victorias police watchdog and its investigation of former deputy police chief Ken Jones. A report by Ombudsman George Brouwer also reveals he has launched a fresh probe into the motives of former police chief commissioner Simon Overland when he complained about Sir Ken to the Office of Police Integrity. The report into the investigation of Sir Ken, who quit the police force in May, criticised the OPI for its failure to appropriately apply whistleblower protection laws. The 20-page report also found: I Considerable gaps in the investigation of phone taps in Victoria, with the Ombudsman saying he was unable to investigate the OPIs alleged intercepts due to federal laws. The OPI used telephone intercepts to listen to Sir Ken and his family. I The OPI had no direct knowledge that Sir Ken had released confidential police information to the media. The investigation of Sir Ken was triggered by a complaint alleging he was the source of a leak to The Age about the prison death of crime figure Carl Williams. I The OPI believed there was an irreconcilable conflict of interest in the secondment of leading senior constable Tristan Weston as an adviser to state Police Minister Peter Ryan. Mr Brouwer said the arrangement was not viable. mans reference to the result of an investigation by The Age, Mr Strong said. He said the OPI had taken every step required under the whistleblower law, and said the Ombudsmans view on the OPIs jurisdiction was ambiguous and potentially wrong. In June, The Age revealed that the OPI was using telephone intercepts to monitor Sir Ken and Mr Weston, an unsuccessful Liberal candidate at the 2010 state election. That investigation was triggered, The Age also revealed, by a complaint to the OPIs deputy director Paul Jevtovic against Sir Ken by Mr Overland alleging he had leaked sensitive information to the media. The Ombudsmans report was then triggered by a complaint by Sir Ken to Mr Brouwer. Mr Brouwer recommended further measures to monitor and assess the use of phone taps, saying improper use or overuse of interception powers could go undetected. Mr Brouwer also recommended sweeping changes to whistleblower laws, finding a lack of legal protection can only have the effect of dissuading potential police whistleblowers from coming forward. Yesterday, Mr Ryan was critical of Victorias checking of phone intercepts, saying powers were not there in state laws. He said the government was considering the reports recommendations. The OPI is expected to complete a separate report into Mr Weston within a week. The report will include an examination of conduct by Mr Weston involving Sir Ken, and Mr Westons alleged leaking of details about Mr Overlands handling of an inquiry into the sending of racist or pornographic emails by police, within a week. The Ombudsmans report, tabled in State Parliament yesterday, highlights the tensions between Victorias two police corruption bodies and will increase pressure on the Baillieu government to establish its promised and overdue anti-corruption commission. The report did not find any evidence that OPI officers wrongly influenced or directed the OPIs investigation or that it acted detrimentally to a person believed to be a whistle blower. OPI director Michael Strong objected to the Ombudsmans reference to an article in The Age that found no evidence of Sir Ken leaking to the media. I am yet to complete my investigation hence my surprise and concern about the Ombuds-

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Labor brawl brews on refugees

By MICHELLE GRATTAN
POLITICAL EDITOR
PRIME Minister Julia Gillard has set the scene for another battle within Labor at the December national conference, declaring the partys asylum seeker platform is ambiguous and must be clarified. As the government struggles to get the vote of West Australian National Tony Crook for its Malaysian people-swap bill, Ms Gillard told caucus the current platforms wording was all things to all people and could be read in different ways. She said that in general the partys platform should be unambiguous on subjects, which helped avoid difficult debates later. During the debate some weeks ago over the Malaysian people-swap legislation the Left, including party elder John Faulkner, insisted the bill breached the supposedly binding platform a claim Ms Gillard strongly denied. She was backed up by former immigration minister Chris Evans, who drafted the existing platform. While Ms Gillard will want a platform that clearly sanctions offshore processing, the Left is expected to argue for wording that says all processing should be onshore. A Left convener, Senator Doug Cameron, who fought the people-swap bill, said yesterday: The Left will want a robust debate on asylum seekers. He expected the activist group Labor for Refugees would be mobilising up to the conference. Senator Cameron said he could not say precisely what the Left would push for until there had been talks in the faction. The government is already battling to manage the gay marriage issue on which the party is sharply divided for the conference. Mr Crook yesterday said he had still not made up his mind on how he will vote tomorrow on the legislation to get around the High Court decision that struck down the Malaysia deal. Losing the vote in the lower house would be a major setback for Ms Gillard. Last night Mr Crook met with Tony Abbott and he hopes to have talks with Ms Gillard today. On Monday he met state Nationals, including their leader Brendon Grylls. He said they will support any position I come to. But WA Liberal Premier Colin Barnett yesterday urged him to vote with the opposition. I think he should vote along with the Coalition. His voters, the people who elected him, would have expected him to do that as a National Party member, Mr Barnett said. Mr Crook said there was no doubt that his

PICTURE: VINCE CALIGIURI

By ANDREW EDDY RIVAL racing stables are often far from cordial at this time of year, but multimillionaire owner Lloyd Williams and recordbreaking trainer Gai Waterhouse were in no mood for hostilities at Moonee Valley racecourse yesterday morning. Williams reckons Waterhouse has all but saved thoroughbred racing from falling off the map with her bubbly, infectious

Josh Gordons analysis PAGE 2 Editorial PAGE 22

exuberance. She is racings superstar. She is just so wonderful for the sport, he said. Waterhouse returned the admiration for Williams passion for the sport and his endless pursuit of racings greatest prizes. Williams is one of racings most reclusive players. His team of horses many of them expensive imports from Europe are trained in private at his Mount Macedon property where Ethereal was prepared to win the

2002 Caulfield and Melbourne Cup double. It has been years since he went to the races and his son Nick handles the load of race day. Conversely, Waterhouse could not be more visible than she has been for 20 years in most forms of the media. Yesterday, the pair met at Moonee Valley just five days before the Caulfield Cup, in which Williams has one runner in Green Moon and Waterhouse one in Tullamore.

Migration agents suspected over sex slavery

By NICK McKENZIE and MARIS BECK
AGE INVESTIGATIVE UNIT
AUSTRALIAN migration agents suspected of involvement in international sex slavery syndicates and running illegal brothels are keeping their government licences despite being implicated in police investigations. The Age has uncovered complaints and information in police documents that reveals the alleged involvement of two licensed migration agents, Yasmin Bao, of Melbourne, and Xu Xu Li, in Sydney, in Australias illicit sex trade. Police have told The Age that federal or state authorities have uncovered up to a dozen corrupt migration agents, but that the federal government is not acting on information gathered. The Victorian government has announced it will introduce laws today to replace Consumer Affairs as the lead agency in charge of sex industry oversight and put police in charge. The announcement follows reports

theage.com.au

THE FLESH TRADE

in The Age that exposed the state governments failure to act against licensed brothels after state or federal policing authorities gained evidence implicating the parlours in allegations of sex slavery or organised crime . Federal Home Affairs Minister Brendan OConnor told ABC

VIDEO One womans story of enslavement.

Radio that evidence of sex slavery aired as part of a joint Age-Four Corners investigation was disturbing. With respect to licensed brothels, they are stateregulated and they need to be properly regulated, Mr OConnor said. Greens senator Sarah

Agent Xu Xu Li.

Hanson-Young said the government-issued licences of brothels and migration agents should be suspended if there was solid police evidence they were involved in trafficking. There needs to be far swifter action taken where there is evidence, whether that be in brothels or with migration agents. We are talking about people who are having their lives taken away from them because they have been trafficked and forced to be sex slaves. I struggle to see how a light approach is acceptable.

Victorian Consumer Affairs Minister Michael OBrien has refused The Age an interview about the issue for the second day. The Australian Federal Police confirmed that it is aware of allegations of migration agents involved in the sex trafficking industry but referred questions about the licensing of these agents to the Department of Immigration and Citizenship. The department said it had no evidence to suggest any

Continued PAGE 2

Continued PAGE 9 Editorial PAGE 22

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Migration agents suspected over sex slavery

From PAGE 1
migration agents have been linked with people trafficking in the sex industry in the last five years. Ms Bao, registered as a federal government migration agent in Melbourne, has for months allegedly been working with a syndicate that runs illegal brothels in apartments in Melbournes CBD. The brothels are staffed by Asian women on student visas. When contacted about the claims, Ms Bao whose conduct has twice been referred by a complainant to the Victoria Police and once to the federal police conceded that some of the Asian women working as masseurs offered sexual services to clients. Sometimes the client instructs the girl [to give extra services] because the girls are young. Theyre very easy. Some customers trick them. When asked by The Age how she could act as a migration agent agents are required under federal government rules to be of good repute and allegedly be involved in the illicit sex industry, Ms Bao said:

New laws to tackle criminality in flesh trade

By MARIS BECK and JOSH GORDON
NEW laws to crack down on criminality in the sex industry will be introduced into State Parliament today. The Sex Work and Other Acts Amendment Bill 2011 would put police back in charge of sex industry law enforcement. The proposed changes follow an Age investigation which uncovered evidence of licensed brothel owners being linked to police inquiries into sex slavery and organised crime, while illegal brothels flourish amid a tangle of uncoordinated regulators led by Consumer Affairs Victoria.
You want me to stop massage or you want me to stop the migration agent business? Migration agents are registered by the federal government and have powers to help people get visas and deal with the Immigration Department. They are meant to be governed

Consumer Affairs Minister Michael OBrien said the new laws would minimise uncertainties about responsibility. The amendments will remove barriers to Victoria Police taking action against illegal brothel operators and properly balance the responsibilities of law enforcement agencies and licensing authorities. He said the laws would make it clear that police were responsible for pursuing convictions against illegal brothel operators. Local government would continue to prosecute breaches of planning regulations and Consumer Affairs would retain its licensing oversight role.
by a strict code of conduct. Xu Xu Li is a Sydney migration agent referred to several times in federal police documents recently tendered to the Melbourne Magistrates Court in the prosecution of a woman alleged to have kept sex slaves in a Melbourne brothel.

Proposed changes to the Sex Work Act 1994 include: I Granting police powers to enter suspected illegal brothels on reasonable grounds. I Extending bans for people who invite or solicit sex work by up to two additional years. I Requiring the Business Licensing Authority to refuse applicants who have committed an indictable offence that would render the grant of a licence against the public interest. A taskforce comprising police, Consumer Affairs, planning officers and federal agencies has so far referred 19 suspected unlicensed brothels to Victoria Police since starting operations in March.
The AFP documents allege that Ms Li arranged student visas and school applications for two women trafficked by an international crime syndicate from Asia to Australia in mid 2009. The syndicate allegedly trafficked women and then forced them to work as sex slaves in brothels

in Sydney and Melbourne. A federal police witness statement from one of the alleged sex slaves says Ms Li was working with two senior syndicate figures. I realised that she [Ms Li] must be working with them and must be in charge of all the student visa applications. Last year, federal police raided premises connected to Ms Li, although she has not been charged with any offence and has denied any wrongdoing, claiming she, too, was a victim of the trafficking syndicate. Chief executive officer of the federal governments Migration Agents Registration Authority, Christine Sykes said no agents in the past 10 years had been sanctioned over allegations of sex slavery or trafficking. Since the office began operations in July 2009 after a review of statutory self-regulation of the migration advice profession, 17 registered migration agents had been sanctioned over other breaches. Neither Ms Li nor Ms Bao has been sanctioned. With TOM REILLY and ANNE DAVIES

Ombudsmans report is a short but gruelling read

OMBUDSMAN George Brouwers investigation into the Office of Police Integritys investigation into claims that former deputy commissioner Sir Ken Jones leaked sensitive police information is a gruelling read despite running to just 20 pages. It is riddled with complexity, confusion and subtext, and as such highlights serious inadequacies in Victorias police integrity and whistleblower protection laws. A brief recap. In May, Sir Ken complained to the Ombudsman that he had been targeted by the OPI because former police chief Simon Overland had accused him of leaking sensitive information relating to the death of Carl Williams and Victoria Polices (mis)management of homicide investigations. As Brouwer strongly suggests, the OPI apparently at the behest of Overland went ahead and launched the investigation despite there being no direct knowledge that Sir Ken

ANALYSIS
JOSH GORDON
had been responsible for the leaks. Brouwer also refers to revelations in The Age the recipient of leaks that there was no evidence that Sir Ken was responsible. This reference seems to have particularly rankled OPI director Michael Strong, who apparently complained to Brouwer that he had effectively exonerated Sir Ken by including it (which of course it does not, says Brouwer). After launching his investigation into Sir Kens complaint, Brouwer informed Strong that the OPI had failed to consider how whistleblower protection laws might apply, despite being required by law to do so. In a further embarrassment, Strong was then forced to suspend his investigation, which had been relying on powers

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provided by the Police Integrity Act, which had apparently allowed the OPI to tap Sir Kens phone and follow him for a period of four weeks. Victorias Solicitor-General was then called in to sort out the mess. But far from providing clarity, according to Brouwer, he concluded that the OPI was required to consider both the Police Integrity Act, and whistleblower protection laws. This, he said, had led to a situation where the level of cover provided to whistleblowers in Victoria was highly dubious, because it was up to the OPI directors discretion to determine whether whistleblowers should be named in Police Integrity Act reports. If you are confused, youre not alone. But the bottom line is that the OPI has been allowed to operate for years behind a wall of secrecy, despite insufficient laws. The situation is, to be blunt, a mess. Josh Gordon is state political editor.

investigations@theage.com.au

Bushfire book inspiring

AGE reporter Karen Kissane has won the Colin Roderick Award for Australian book of the year for her book on the Black Saturday bushfires. The judges for the $10,000 prize described the book, Worst of Days, as outstanding in bringing alive the events of February 7, 2009, when bushfires devastated Kinglake and surrounding communities. The book is instructive, heartbreaking, inspiring, haunting and impossible to put down a masterpiece of lucid narrative and structure, they said.

Karen Kissane and Michael West.

Previous winners of the award include Malcolm Knox, Don Watson, Tom Keneally, Peter Carey, David Malouf and Ruth Park. Kissane, now The Ages Europe correspondent, was also shortlisted for the Graham Perkin Award last year for

her extensive coverage of the inferno and its aftermath. Meanwhile, BusinessDay senior writer Michael West has been shortlisted for this years Walkley Business Journalism Award for his story Rio dumps record BHP deal. According to the judges, Wests exclusive detailed the decision to end the proposed merger of mining giants BHP Billiton and Rio Tintos iron ore interests and was a classic scoop. You can read Michael Wests short-listed story at businessday.com.au.

Kissanes winning book.

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GG dresses (twice) to impress President

By TONY WRIGHT

WE WOULD not dare speculate that Governor-General Quentin Bryce has a large beach towel tucked away in her limousine, but it was tempting to imagine her, like a teenage surfie chick, struggling in the back seat out of one outfit into another, legs and arms akimbo beneath just such a cloak as she was borne between engagements yesterday. There she was, shining in buttercup yellow on the Canberra tarmac beneath Air Force One as US President Barack Obama bounded down the steps to grasp her hand in his famous two-pawed grip, holding it for a long half a minute, sealing the moment with the merest touch on the elbow. And barely half an hour later, having travelled from the airport to Parliament House, there was the GovernorGeneral greeting the President again at the Great Verandah at Parliament House. Gone was the buttercup. Her new outfit was a tangerine dream. Everyone, it seemed, was intent on making an impression on the President. Hardly surprising, really. For the past year or so, there was a growing fear among political leaders who invest so much in the apparently supernatural power of a presidential visit to boost flagging popularity that Obama would never make it to Australia.
Continued PAGE 6

Nurses may defy ruling to lift work bans

By KATE HAGAN and JULIA MEDEW
THE industrial umpire last night ordered nurses to lift work bans that have closed almost 1000 beds across Victoria by 9am today but nurses have not ruled out defying the order. Fair Work Australia ruled that the bans, which have also delayed more than 500 operations, were a risk to patients and should be suspended for 90 days while negotiations continue. The ruling follows five days of industrial action which Health Minister David Davis said was causing grave concerns. Nurses have maintained that their work bans were not harming patients. Speaking immediately after the ruling last night, Australian Nursing Federation state secretary Lisa Fitzpatrick would not rule out continued bed closures through unprotected industrial action. But Mr Davis told The Age last night that it would be extraordinary if nurses chose not to abide by the decision. Ms Fitzpatrick said she would take legal advice on the decision this morning. Our members will decide what they do next, she said. Victorian Hospitals Industrial Association chief executive Alec Djoneff said he feared nurses would continue to close beds based on their actions during previous disputes. In 2007, we got to precisely this point and then they proceeded with unprotected action the next day, he said. I just hope history wont repeat itself but the rumour is that it will. Mr Davis and Mr Djoneff welcomed the ruling, which they said vindicated their case that patients had been put at risk by the bans. If nurses proceed with unprotected action, they risk individual fines of up to $6600, and up to $33,000 for their union. They can also be sued. Nurses are seeking an 18.5 per cent pay rise over three years and eight months and have voted to reject the governments offer of a 2.5 per cent annual rise with further gains to be traded for productivity cuts. They are also at odds over nurse-patient ratios, which the government says should be more flexible. Nurses have the right to resume protected industrial action after 90 days if they do not reach an agreement. Hospitals had applied for Fair Work Australia to terminate the industrial action, which could have led to compulsory arbitration if a deal was not reached in 21 days. A leaked
ISSN 0312-6307

Quentin Bryce and Julia Gillard greet Barack Obama as he arrives in Canberra. Inset: The Governor-General at Parliament House.

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Obama: Were here to stay

Plan for more US troops in Australia
By DANIEL FLITTON and MICHELLE GRATTAN
AUSTRALIA and the United States have unveiled a major strengthening of their military ties, as President Barack Obama declared the Asia-Pacific region was of huge strategic importance to America. At a joint news conference in Canberra within hours of the President arriving on his first official visit to Australia, Prime Minister Julia Gillard announced that US marines would be deployed in the Northern Territory for six months each year, starting with 250 next year and building to 2500 in 2016-17. The troops will be allowed to train alone in Australia for the first time, and will help Australia build its own amphibious force for storming beaches and supplying disaster relief. There will also be more US military planes flying in and out of the Northern Territory. On a visit marking the 60th anniversary of the US-Australia alliance, the President pledged America was here to stay in this vital region. But he played down perceptions that the deployment was aimed at China. This notion that we fear China is mistaken. The notion that we are looking to exclude China is mistaken, Mr Obama said. We welcome a rising peaceful China. He stressed, however, that when necessary we will send a clear message to them that they need to accept the rules and responsibilities that come with being a world power. Chinas state-owned media, in a warning coinciding with yesterdays announcements, said Australia should not be caught in China-US crossfire and play China for a fool. A story on the Peoples Daily website said: Apparently, Australia aspires to a situation where it maximises political and security benefits from its alliance with the US while gaining the greatest economic interests from China. However, Gillard may be ignoring something their economic cooperation with China does not pose any threat to the US, whereas the Australia-US military alliance serves to counter China. Indonesia also expressed concern that the greater US military presence in Australia could provoke a vicious circle of tension and mistrust in the region. What I would hate to see is if such a development were to provoke a reaction and counterreaction, said Indonesian Foreign Minister Marty Natalegawa, ahead of this weeks ASEAN and East Asia leaders summits in Bali. Aware of regional sensitivities, Australian officials briefed officials of China, Indonesia and India, as well as New Zealand, over the past few days about the new arrangements. Other countries were briefed yesterday. Helicopters, artillery, light armoured vehicles and Harrier jump-jets are expected to be eventually stationed in Australia as part of what is known as a Marine Air-Ground Task Force. The deployment will be to the military air base RAAF Tindal, outside Katherine, after an expansion of the runway to cope with larger American transport aircraft. In the longer term, US navy ships will pay more frequent visits to the Stirling naval base in Western Australia. Building on our alliance through this new initiative is about stability, Ms Gillard said. Australia would be better positioned to respond to any regional contingency including humanitarian assistance and natural disasters, she said. Mr Obama said America was deeply grateful for the alliance, and that it was stepping up its commitment to the entire Asia Pacific. The initiatives meant that were going to be in a position to more effectively strengthen the security of both our nations and this region. The Americans will carry

Continued PAGE 6

Authorities took a decade to act on brothel bribe evidence

By NICK McKENZIE and MARIS BECK
AGE INVESTIGATIVE UNIT
POLICING agencies failed for up to a decade to act on information that operators of several of Victorias illegal brothels were bribing the officials meant to shut them down. The Age can reveal that

THE FLESH TRADE

former council worker Kenneth Wolfe (pictured right), who was sentenced yesterday to more than three years jail for taking

$134,260 in bribes from operators of illegal brothels, was recorded by the Australian Crime Commission and other agencies as taking bribes in the early 2000s. Police investigations into Wolfe began only in 2010, when Richmond detectives received fresh information about him. The failure to follow up the

intelligence from up to a decade ago meant Wolfe and at least one other corrupt local government enforcement official were able to spend years taking illicit payments from crime syndicates running illegal brothels. During this same period, Wolfe, a former City of Yarra senior enforcement official, was called to testify at a federal

parliamentary inquiry into the trafficking of women into sexual slavery. The 2010 Richmond probe has led to the charging of four Chinese nationals with offences related to bribery or illegal prostitution. A second local council enforcement officer from a northern suburbs council was recently suspended after a

police investigation prompted by the Richmond inquiry. Wolfes suspected corruption first came to light in connection with a suspected illegal brothel owner, Liang Dong, who was investigated by state and federal authorities for drug trafficking in the early 2000s before his deportation in April 2004.

Continued PAGE 2

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Josh Gordon on Baillieus borrowed transport plan

This time there are no glossy maps, no timelines, and no estimates of potential costs.
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A clean sweep?

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Super 7s Oz Lotto (draw 926) dividends: Division 1, no winners; division 2, $24,357.40; division 3, $2350.65; division 4, $256.20; division 5, $29.15; division 6, $17.35; division 7, $12.85. Wednesday Lotto (draw 3087): 26, 10, 11, 12, 7, 20. Supplementaries: 17 and 4.

Threat of Gaza strike

As Hamas and Fatah try to bury their differences at a meeting in Cairo this month, Israel says it may launch a new assault on Gaza after months of rocket attacks. PAGE 12

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Those who rant about the Occupy movements supposed lack of direction are showing just how out of touch they are, writes James Rose at theage.com.au/nationaltimes

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Whats the problem, asks Fairfax chief

By TIM DICK
AS THE print media inquiry resumed its hearings in Sydney, Fairfax Media boss Greg Hywood posed a question for its head, Ray Finkelstein. What problem was there for him to fix? The federal government asked Mr Finkelstein, QC, a former Federal Court judge, to investigate the press in Australia in the wake of the News of the World phone hacking scandal, encouraged by the Greens, which had particular criticisms of News Ltd publications. But all three major publishers News, Fairfax (owner of The Age) and APN dispute the need for major changes beyond improvements to the current system. The journalists union and the industry self-regulator, the Australian Press Council, disagree on some points. During a series of questions about possible Press Council reform, Mr Hywood began questioning Mr Finkelstein on the basic point of his task. What problem are we solving here? he asked. Whats the issue current in the media, in the way that were operating, that needs a solution? What we have not got are examples of serious atrocities of the like that occurred in the UK that must be fixed. Theres nothing systemic here that needs fundamental institutional change. Mr Finkelstein said he had not heard anyone say the Press Council should be abolished, so he assumed there was still a need for it, but given the council had said it was underfunded, he was considering ways for it to be more effective. Mr Hywood said it was funded adequately for its core function of mediating and adjudicating complaints, and raised concerns of possible government influence if it were ever to partly rely on public money rather than that from publishers. Once you have government involvement, any institution will be vulnerable to influence, he said, later adding: I ran a government statutory authority [Tourism Victoria] that was supposed to be at arms length from the government. Ha, ha, ha. In its submission, Fairfax said it was not the job of journalists to be liked or even respected, but to ask the questions people do not want asked. Relationships between reporters and people in power were fraught, it said, but a robust free press was fundamental to democracy. Chris Warren, federal secretary of the Media Entertainment and Arts Alliance, told the hearing the inquiry was necessary, given crises facing journalism in trust and its commercial model. The union supports a single selfregulator for journalism online, in print and on TV and radio.

Nurses may defy ruling to lift hospital work bans

From PAGE 1
document this month revealed that the government wanted to push the matter to compulsory arbitration, where it could challenge the tribunals capacity to rule on nurse numbers and conditions including nurse/patient ratios. But last nights ruling means that negotiations will continue without the threat of arbitration. Meanwhile, one health network last week quietly gave emergency doctors a huge pay rise to prevent threatened industrial action. A group of 24 doctors at Western Health, which includes the Western, Sunshine and Williamstown hospitals, will be given an immediate 30 per cent increase after they agreed to sign new contracts. The deal, which brings their pay into line with other emergency physicians across Victoria, prevented work bans that would have coincided with the nurses action last weekend. A leaked letter from Western Health reveals the doctors were

Authorities took a decade to act over brothel bribes

From PAGE 1
During that investigation, law enforcement agencies uncovered significant intelligence suggesting the drug trafficker and his Chinese associates were bribing local government officials in return for tipoffs about raids on brothels the crime figures operated. Court documents obtained by The Age from Wolfes recent court hearings state that around 2002, a Chinese male, Liang Dong, who was part-owner/ operator of the unlicensed brothel [formed a relationship with Wolfe] to the point where the accused gave Dong his Tabcorp account number and PIN number in order to facilitate corrupt payments. The papers state: Since 2002, there have been numerous complaints from the community and government agencies that the . . . unlicensed brothel [owned by Dong] . . . was continually operating. This unlicensed brothel, despite the number of complaints, was allowed to continue operating [until late 2010] as a direct result of the corrupt actions by the accused. The revelation that authorities failed to act on the information about Wolfe for years raises further questions about regulation of the states legal and illegal brothels. A source told The Age the information about Wolfe from the early 2000s had fallen through the cracks, due partly to the disjointed and sporadic nature of policing of Victorias sex industry. Earlier this year, The Age revealed a separate case in which the state government was licensing brothel owners despite police information showing their involvement in the trafficking of women or organised crime. The government has committed to introducing laws to improve policing and regulation of the sex industry, but critics say the laws do not go far enough. Wolfe was sentenced yesterday in the County Court to three years and two months in prison, with a non-parole period of 20 months, having pleaded guilty this year to three consolidated counts of taking bribes from illegal brothel operators. In return for the payments, Wolfe, 57, of Seaford, tipped off illegal brothel operators about raids by police and regulators. Judge Damian Murphy said Wolfes offending involved a significant amount of money over a period stretching from 2002 to 2010 and a breach of trust. He said the sentence was mitigated by factors including Wolfes guilty plea and the fact he agreed to testify against those accused of bribing him. Wolfe, who was a policeman for 16 years, resigned as the City of Yarras co-ordinator of planning enforcement after his office was raided last November.

Lisa Fitzpatrick

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theage.com.au Turnbull queries Australian content rules

asked to view details of their deal in the Western Hospital boardroom because of current sensitivities around the public release of legal advice as it relates to the nurses EBA. Last night, the Victorian Emergency Physicians Association, which represents the doctors, said it fully supported nurses. The association also congratulated nurses on their excellent job in ensuring patient safety during the dispute. It said emergency departments were no worse and in some cases better than during winter, despite the work bans. Association spokesman Dr Allan Whitehead said the doctors expected to sign their contracts this week.

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