News and Press Releases

Used Straw Corporations to Run Massage Parlors and Tanning Salons Providing Sex Acts

December 2, 2009

JESUS “JESSE” DELEON, 47, of Irvine, California, was sentenced today in U.S. District Court in Seattle to 22 months in prison and three years of supervised release for conspiracy to transport individuals in furtherance of prostitution. DELEON and his co-conspirators operated a string of massage parlors and tanning salons that were fronts for prostitution. DELEON was also ordered to forfeit more than $152,000 and eleven luxury watches including four Rolex watches, two Tag Heuer watches, and Cartier and Bulova watches. At sentencing, U.S. District Judge James L. Robart noted that DELEON had already served 22 months in a California state prison for a similar scheme in Sacramento County. The federal sentence is in addition to the state prison time.

Earlier this week, a second defendant, DONALD KERRY FREY, 38, of South Lake Tahoe, California, was sentenced to two years in prison and three years of supervised release. Both FREY and DELEON were indicted February 11, 2009, and both pleaded guilty to conspiracy to transport individuals in furtherance of prostitution on July 30, 2009. FREY assisted DELEON with the running of the brothels, picking up cash payments of $25,000 or more from the women who operated the businesses. FREY knew the women working at the brothels had been recruited and transported from out of state to provide sex acts to customers.

The three businesses in the Seattle area were The Aloha Tanning Resort located at 2828 Sunset Lane N.E., Renton, Washington; The Avalon Spa located at 9530 Aurora Avenue North, Seattle, Washington; and The Malibu Tanning Spa located at 13985 Interurban Avenue South, Tukwila, Washington.

Assistant United States Attorney Ye-Ting Woo wrote to the court that DELEON “created and developed a fairly sophisticated scheme of operating prostitution-front businesses in Washington State for four years, employing numerous women who traveled to the State of Washington to be employed as sex workers. Defendant Deleon made concerted efforts to conceal the criminal proceeds through the use of multiple bank accounts, and then when he believed law enforcement may discover these accounts, closed them and initiated the physical transportation of thousands of dollars from Washington to California to avoid law enforcement detection.”

“Let these prosecutions serve as a warning to the owners of any business which operates as a front for illegal activity,” said Kenneth J. Hines, the IRS Special Agent in Charge of the Pacific Northwest. “You're not fooling anyone with what you are doing. The men and women who serve our communities as law enforcement officials are dedicated to protecting us from criminal activities.”

“The exploitation of women in this manner for the sole purpose of turning a profit is not only criminal, it is an unacceptable way to treat other human beings,” said Leigh Winchell, special agent in charge of U.S. Immigration and Customs Enforcement’s (ICE) Office of Investigations. “ICE will aggressively investigate these crimes to deter this type of activity in the future.”

The case was investigated by U.S. Immigration and Customs Enforcement (ICE), the Seattle Police Department, King County Sheriff’s Office and Internal Revenue Service Criminal Investigation (IRS-CI).

The case was prosecuted by Assistant United States Attorney Ye-Ting Woo. Ms. Woo leads the U.S. Attorney’s Office task force on human trafficking.

For additional information please contact Emily Langlie, Public Affairs Officer for the United States Attorney’s Office, at (206) 553-4110 or Emily.Langlie@USDOJ.Gov.

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