The owners of a northwest-side massage parlor that is the subject of a prostitution and sex trafficking investigation are asking for their two homes, cash and other property, which authorities seized, to be returned to them.
Also, newly obtained court records described what investigators said was a criminal operation that brought in sex workers from other states to work at the massage business for 15 days at a time while being housed in one of the coupleβs residences.
Earlier this week, Charles and Wenjuan Krause, the owners of Tui-Na Massage, 2840 W. Ina Road, filed a claim in Pima County Superior Court, asking for property and money seized in the criminal investigation to be returned to them, the documents show.
In May, Tucson police arrested the Krauses, who are married, following a monthslong investigation into their business, according to court records.
On May 23, a state grand jury indicted the couple on charges of money laundering, operating a house of prostitution, transporting persons for the purpose of prostitution and receiving the earnings of prostitution β all felonies.
In July, the state seized two properties and two vehicles identified in the investigation after Tucson police served search warrants at Tui-Na, and the coupleβs two homes, located in the Marana and Oro Valley, according to court records.
Investigation details
Tucson police and federal Homeland Security agents began investigating Tui-Na last fall, after detectives learned that multiple women who worked at the business were performing sex acts for money, according to a court document filed by the Tucson Police Department.
βThrough the investigation, it has been observed that the client base for Tui-Na consists of only males who are mainly 40 years of age or older,β the document says.
Investigators learned the couple used the house in Marana as living quarters for the βrotating cast of Asian females that work and perform massage/sex acts at Tui-Na,β according to the document.
Many of the women have prior arrests for prostitution in Arizona and other states and workers interviewed by police said they traveled from Mesa and Los Angeles to work at Tui-Na for 15 days at a time.
At the end of the 15 days, the women received a check from the Krauses and returned to their homes outside of Tucson, the report states
While conducting surveillance on multiple occasions, investigators saw Charles Krause and an unidentified person drop off three women at Tui-Na in the morning, then take them home at 11 p.m.
Undercover officers visited the business twice and received massages from employees, during which the women offered sexual services, the TPD complaint shows.
Although the officers were able to use credit cards to pay for the $60 massage, the women said the sex acts cost $40 extra and could only be paid by a cash tip.
An interview with the owner of a nearby business revealed it was common knowledge that Tui-Na provided sexual services. He also told police that a customer of his walked into Tui-Na by mistake and saw a naked women standing inside the business, the police document said.
After he was arrested, Charles Krause told police he is the businessβ bookkeeper, and deposits the previous nightβs earning at a bank each morning. The money was deposited into the business account, but later transferred to Wenjuan Krauseβs personal accounts, the documents state.
Charles Krause also told investigators he was aware that prostitution took place at his business, and that he monitors reviews on websites βused by escorts to advertise, and βJohnsβ to review their prostitution experiences with specific females.β
A seizure warrant filed in court July 14 values the two homes, two vehicles and money that was seized at nearly $550,000.
The Arizona Attorney Generalβs Office is prosecuting the criminal case against the couple in superior court. The office was unable to comment on the case, since it involves an ongoing criminal investigation, said spokeswoman Mia Garcia.
A status conference is set for September, and the Krausesβ attorneys, Jeff Rogers and David Lipartito, have filed a motion to send the case back to the grand jury.
Rogers is representing Charles in both the civil and criminal case, while Lipartito is representing Wenjuan.
Lipartito said that he expects a good result in both cases.
βThe discovery shows no evidence that the Krauses knew what was happening in their business,β Rogers said.
Requesting property be returned
On Aug. 15, Rogers and Lipartito filed a claim in Pima County Superior Court, asking that the coupleβs homes, money and cars be returned.
βNone of the property was the fruits, instrumentality, or locus of a racketeering offense or any criminal act β¦ that would allow its seizure,β according to the claim.
It goes on to say the homes and cars were acquired before the alleged criminal activity began and from lawful proceeds.
In addition, the undisclosed amount of money that was taken from his bank account in May had been acquired since the criminal charges were filed and after Tui-Na closed and βthe end of any activity alleged to be illegal by the state,β the claim said.
βThis is one of the most abusive cases of civil forfeiture Iβve seen in my career,β Rogers said. βVirtually every asset in the case was purchased before the business was opened.β
A search of the Arizona Corporation Commissionβs website shows that Tui-Na was registered by the Krauses in 2008.
According to the claim, the Krauses purchased the house in Oro Valley in December 2014. The Marana house was purchased by Charles Krause in 2006.
βOur case (to get the property back) is pretty solid,β Rogers said. βI donβt see any reason that it wouldnβt be returned.β
