Japanese Gangsters Act to Penetrate U.S. Areas : Crime: The syndicates are moving across America, shifting their emphasis from gambling, prostitution to real estate and corporate investment.

Signs are emerging that Japanese organized crime syndicates are building their presence in the United States, following the huge wave of investment and legitimate business from Japan since the late-1980s, law enforcement officials say.

Members of the yakuza , or boryokudan , crime families are starting to spread out from their traditional U.S. base in Hawaii and are making appearances across America, suggesting an expansion in interests beyond the limited community of Japanese expatriate businessmen and tourists, according to federal and local investigators.

Japanese gangs have traditionally operated gambling, prostitution and pornography rackets for visiting tourists, and have exported handguns illegally to Japan. But now investigators believe there is a shift in emphasis to large-scale money laundering, real estate and corporate investment and hard-core drug trafficking.

“The United States is now a prime investment site for boryokudan capital,” Assistant U.S. Atty. Gen. Robert S. Mueller testified in November before the Senate subcommittee on investigations.

The scope of the problem became apparent in June when it embroiled President Bush’s brother, Prescott Bush, a financial consultant who does business in Asia. He worked for an investment company that Japanese police said was controlled by an underworld kingpin.

Yakuza associates are linked to smuggling an estimated 90% of the crystal methamphetamine, or “ice,” available in Hawaii, FBI Director William S. Sessions told the Senate panel. And the ice traffic is starting to reach the West Coast, often with the collaboration of Korean organized crime groups.

Immigration and Naturalization Service officials say they are seeing a rise in the number of cases where purported yakuza, whose names are on inter-agency watch lists, are stopped and deported at airports in such places as Chicago and Dallas. Border agents throughout the system are trained to look for flamboyant tattoos and missing digits, give-away signs of a yakuza.

Recent investigations have revealed that yakuza were running private high-roller casinos for wealthy Japanese clients in New York, and they have been drawing attention from authorities in Las Vegas and Atlantic City.

A case on the Pacific island of Tinian suggests the appeal of legalized gambling to the yakuza, who claim origins in 17th-Century gambling dens along Japan’s medieval highways.

Tinian, a small island off Saipan in the Commonwealth of the Northern Mariana Islands, a U.S. trust territory, decided to develop a casino industry to draw tourists and boost local revenues. The yakuza are keen on “muscling in,” an investigator with the Tinian Casino Gaming Control Commission contends.

“It’s a back door for Japanese organized crime to penetrate the United States,” said Frederic E. Gushin, director of the commission’s enforcement division. “The yakuza think this is a great idea--a chance to get U.S. passports, to launder money, to follow the groups of tourists that they control.”

One of the major applicants for a Tinian casino license, ASA Development & Investment Corp. of Tokyo, is a “front for the Yamaguchi-gumi ,” (one of the yakuza gangs) and was “created and funded” by it, the commission stated in an investigation report.

The focus is on Yukihiro Asai, a Japanese national who owns 92% of ASA Development. Asai’s lawyer said his client will contest the allegations during a commission hearing scheduled Monday on Tinian. He would not discuss the charges of yakuza connections and said Asai was not available for comment.

“This matter should not be debated in the news media,” said Edward Manibusan, the attorney. “If my client is associated with the Yamaguchi-gumi, then let all the facts come out in the hearing and let the commission decide.”

So far, no other Tinian casino applicant has the financial backing enjoyed by ASA Development, which proposes a $300-million casino and hotel. Gushin, a former New Jersey gaming enforcement official, is concerned that standards may be compromised. “If there’s no credible regulatory structure, it will be a tremendous opportunity for the Yamaguchi-gumi to get in and take control,” Gushin said.

Gushin notes that the yakuza are heavily involved in tourism and in prostitution in Guam and Saipan, and he reasons that a strong position in these U.S. territories allows the gangsters a way to slip through tightening immigration controls in Hawaii and the U.S. mainland.

“We know there are some questionable activities” in the Northern Marianas, said Bruce J. Nicholl, senior special agent for the INS in Washington. “I believe it to be a place that has a potential for serious criminal activity, and anything that involves the Yamaguchi-gumi or their friends is serious criminal activity.”

In Las Vegas, yakuza connections have been alleged in several casino and liquor license applications by Japanese nationals, but these charges have not been sufficiently substantiated to block licensing.

The situation is cause for grave concern because U.S. law enforcement agencies are poorly equipped to deal with the unique challenges of fighting Asian organized crime, particularly when it comes to penetrating language barriers and cultural links between the gangs and mainstream society in their homeland.

Ethnic Chinese gangs are far ahead of the Japanese in establishing a menacing foothold in the United States; they now play a dominant role in heroin trafficking and appear to be replacing the traditional La Cosa Nostra crime families, who have been crippled by aggressive prosecution, in other criminal enterprises as well.

Because of a greater propensity toward violence, and because of the fear that stepped-up activity will follow Hong Kong’s reversion to mainland China in 1997, the Chinese triads and tongs and Southeast Asian gangs are receiving priority in the government’s fight against Asian organized crime.

But Japan’s yakuza have a demonstrated facility in cloaking their interests behind on-the-level business activity. The Prescott Bush case is an example of what investigators believe is a typical practice.

The President’s brother earned $250,000 in fees as a consultant to a Tokyo investment company, West Tsusho, which was allegedly controlled by a yakuza leader, the late Susumu Ishii of the Inagawa-kai . Ishii played an integral role in the financial scandal that recently rocked Japan’s financial industry and that prompted Tokyo police to make the extraordinary demand that business organizations admonish their member companies to stop all dealings with gangsters.

Under Prescott Bush’s recommendation, West Tsusho bought shares in two American companies, Quantum Access, a Houston-based software development company, and Asset Management International Finance and Settlement. Bush has not commented publicly on the case, but all indications are that he had no knowledge of his client’s purported underworld connections.

Organized crime in Japan is big business. Japanese police estimate that the more than 2,000 underworld families employ about 90,000 people in criminal behavior, taking in about $10 billion a year in proceeds--a third of it from the sale of crystal methamphetamine to the domestic market.

The yakuza have forged strategic tie-ins with crime groups in South Korea and Taiwan, where the methamphetamine is made in clandestine factories. Japanese gangs draw many of their members from the disadvantaged community of resident Koreans, and they play a paternal role for less sophisticated pokryokbae crime groups on the Korean Peninsula.

Police in Pusan, South Korea, raided the headquarters of the White Tiger Gang last year and found evidence that leaders had attended a “10-day seminar on being mobsters” at Yamaguchi-gumi’s headquarters in Japan, Kyodo News Service reported.

“They studied the rigid yakuza code of etiquette, took a night course on shooting firearms and came home sporting the close-cropped hairstyle of the Japanese Mafia,” Kyodo said.

Those alliances are holding up on this side of the Pacific as well, law enforcement officials say. Korean gangs are also involved in smuggling methamphetamine into Hawaii and Los Angeles.

In November, the FBI in Honolulu arrested four Korean men on trafficking charges and seized 37 pounds of crystal methamphetamine with a street value of $12 million--the largest domestic seizure ever of the drug. Two of the suspects, Young Bum Hyon, 42, and Yong Tae Kim, 31, are residents of Los Angeles, the FBI said.

The case resulted after agents targeted an “entire Korean organized criminal enterprise that was based in Honolulu, and that stretched from the Republic of Korea to the U.S. mainland,” the FBI said in a statement.

“The Asian organized crime groups are not a whole lot different from the old La Cosa Nostra,” said Thomas R. Parker, assistant special agent in charge at the FBI’s Los Angeles office. “They’re into extortion, infiltrating legitimate business, gambling, drugs. If there’s a quick buck to be made, they’ll be into it.”