Two guilty of loan-sharking at Connecticut casino

Wednesday, Sept. 4, 2002 | 9:42 a.m.

NEW HAVEN, Conn. -- Two men were found guilty of loan-sharking at Foxwoods Resort Casino, the first loan-sharking convictions in connection with Connecticut casinos.

A 12-member federal jury deliberated for three hours Friday before convicting Xiao "Steven" Chen of New York and Gong Chai Sun of California on charges of extortion and conspiracy.

Chen, the alleged ringleader, faces up to 60 years in prison, while Sun faces up to 40 years.

Prosecutors used undercover cameras, casino security tapes and secretly taped phone calls to show that the two loaned money to Asian gamblers at sky-high interest rates and threatened them with bombings and beatings if they didn't pay up.

A business ledger seized from Chen's Foxwoods hotel room showed that he loaned out $396,000 to 138 people during a nine-month period. Most were people from the Chinese sections of Manhattan or Flushing, N.Y, according to coded entries in the ledger.

Prosecutors said the standard three-day loan had a 10 percent interest rate, with one-week extensions for another 10 percent charge. The annual percentage rate would climb as high as 4,000 percent in some cases.