Two Indicted in Connection with Extensive Criminal Enterprise Involving Human Trafficking, Money Laundering
First Use of Money Laundering Statute by AG’s Office
WOBURN – A Medford woman and a Woburn man have been indicted on multiple counts of human trafficking and money laundering after an investigation into an extensive criminal enterprise, Attorney General Martha Coakley announced today. The operation included alleged illegal activity in Bedford, Billerica, Medford, Reading, Wilmington, and Woburn. These are the first individuals charged under the new money laundering statute by the AG’s Office.
A Middlesex Grand Jury indicted Xiu J. Chen, 32, of Medford, and Ronald Keplin, 57, of Woburn on Wednesday. Both Chen and Keplin are charged with Trafficking of Persons for Sexual Servitude (6 counts each), Conspiracy to Traffic Persons for Sexual Servitude (6 counts each), and Deriving Support from Prostitution (6 counts each). Chen is also charged with Keeping a House of Ill Fame (6 counts) and Money Laundering (5 counts). Keplin is charged with one count each of Keeping a House of Ill Fame, Money Laundering, and Possession of Ammunition.
“We allege that these defendants operated massage parlor businesses throughout Middlesex County that served as fronts for illegal activity, including human trafficking and money laundering,” said AG Coakley.
Chen and Keplin were arrested on May 13 by State Police assigned to the AG’s Office and agents from U.S. Immigration and Customs Enforcement’s Homeland Security Investigations (HSI), with assistance from various local police departments.
The arrests were the result of an investigation by Massachusetts State Police assigned to the Attorney General’s Office, in conjunction with agents from HSI and officers from various local police departments, into allegations of human trafficking, money laundering, and prostitution in multiple Massachusetts communities.
According to investigators, Chen and Keplin operated six businesses that were portrayed as massage parlors but were in fact fronts for an extensive human trafficking and money laundering operation. They allegedly characterized and advertised these businesses as providing “bodyworks” services. The businesses are:
- Bedford Asian Bodywork a/k/a Bedford Wellness Center – Bedford, MA
- Shrine Spa a/k/a Billerica Bodywork a/k/a Boston Chinese Club – Billerica, MA
- Mystic Health Center – Medford, MA
- Body Wellness Center – Reading, MA
- Body Language – Wilmington, MA
- Asian Bodywork a/k/a Woburn Wellness Bodywork – Woburn, MA
During the course of the investigation, authorities developed evidence indicating that Chen and Keplin were the leaders of this operation, running a profitable and organized criminal enterprise through these businesses that had been set up as fronts for illegal activity. Through these businesses, Chen and Keplin allegedly offered sexual activity between women they employed and their clients in exchange for a fee.
Chen and Keplin allegedly coordinated the recruitment of women from across the eastern seaboard, including New York. They advertised sexual services on websites known to advertise prostitution, set up appointments for sexual encounters for the women, and managed the financial aspects of the organization. Authorities allege that they arranged for overcrowded housing where the women typically slept on mattresses on the floor, or in some instances on the massage tables at the businesses. Chen and Keplin also allegedly facilitated the daily transportation of the women to and from the businesses.
According to investigators, Chen and Keplin typically received the majority of the profits from these sexual encounters and used that money to perpetuate the criminal enterprise. They allegedly used the money derived from their illegal massage venture to support the daily operations of the businesses, including paying rent, utility bills, and for advertisements.
Chen and Keplin were arrested on May 13 and arraigned in Somerville District Court the following day. A Middlesex Superior Court returned indictments against them on Wednesday. They will be arraigned in Middlesex Superior Court at a later date.
In 2011, AG Coakley filed comprehensive economic crime legislation, which included a state money laundering statute designed to give law enforcement the necessary tools to investigate and prosecute sophisticated criminal activities and enterprises in the 21st century. The crime of money laundering was included and signed into law as part of the state’s casino gaming law in November 2011.
Since the new human trafficking law in Massachusetts went into effect in February 2012, the AG’s Office has handled multiple cases. In March 2012, AG Coakley’s Office arrested and arraigned four individuals charged in connection with running a human trafficking operation in and around the Boston area, who were then indicted in May 2012. In October 2012, the AG’s Office arrested and arraigned three operators of so-called massage parlors in Wellesley and Revere in connection with human trafficking and prostitution. They were indicted in January. In December 2012, the AG’s Office arrested a Dorchester man in connection with running a human trafficking and prostitution operation in the Greater Boston area. He and a Plymouth woman were indicted in March.
The case is being prosecuted by Assistant Attorney General Deb Bercovitch, who handles human trafficking prosecutions within the AG’s Enterprise and Major Crimes Division, with assistance from Investigator Jaclyn Morrill of AG Coakley’s Financial Investigations Division. Victim Witness Advocate Nikki Antonucci of the AG’s Victim Services Division is also assisting in the case. The investigation was conducted by Massachusetts State Police assigned to the Attorney General’s Office and U.S. Immigration and Customs Enforcement’s Homeland Security Investigations, with assistance from U.S. Customs and Border Protection, the Bristol County Sheriff's Office, the Middlesex District Attorney’s Office, the Middlesex County Sheriff’s Office, investigators with the Massachusetts Division of Professional Licensure, and investigators from AG Coakley’s Computer Forensics Lab. Acton, Boston, Bedford, Billerica, Burlington, Dracut, Malden, Medford, Providence RI, Reading, Revere, Waltham, Wilmington, and Woburn Police Departments also provided invaluable assistance in this case.