Empire of Crime

by Tim Newark

Rather than encouraging the Persian opium market, the British government was entering into negotiations with the Persian government to reduce its nation’s production – ‘almost the whole of which for years past has been sent out to the Far East for smoking purposes, in large part clandestinely to the detriment of Hong Kong as well as other countries’. Persia was the new India, as far as opium importers were concerned.

  In the face of this, the British Cabinet made it clear to Sir Cecil that they did not approve of his Hong Kong experiment:

  Unless His Majesty’s Government is prepared to abandon all its previous pretensions and in effect to repudiate its obligations under the Hague Convention, we fear that we do not see how the change in policy introduced by the governor of Hong Kong can be approved or his request for permission to purchase large quantities of Persian opium can be sanctioned.

  This was a blow to Sir Cecil, but he was certainly not alone in expressing discontent with Britain’s policy on restricting the export of Indian opium. Delevingne knew this very well. Earlier in 1927, he had received correspondence from the Governor of the Portuguese colony of Macao, saying ‘if they could get no Indian opium and if, as a result of the decision of the Persian Government to restrict the cultivation of opium in Persia, the Persian supplies of opium fall off, Portugal would be forced to start the cultivation of opium in Timor’. Interestingly, it was Sir Cecil who helped out the Governor of Macao by selling him several chests of Hong Kong’s own stash of opium, but then this had to be made up with more opium from India or Persia …

  Colonial Office administrator Mr J.J. Paskin was even forced to mention the word ‘loophole’, as he tried to negotiate his way through Geneva Opium Agreement rules by suggesting that the forbidden export of Persian opium between colonies might be overcome if the ‘Straits Government should happen to have a consignment on the sea which could be diverted to Hong Kong without its being “imported” into the Straits’.

  The problem with narcotics – the problem created by well-meaning British imperialists in the first place – was that it slowly but surely drew everyone into its net of criminality, including those doing their very best to control it.

  Despite nearly precipitating a rift with London, Sir Cecil Clementi remained Governor of Hong Kong until 1930. He was a modernising ruler, establishing Kai Tak airport, which continued in use until 1998, and ending Chinese female maid servitude, which had often encouraged abuse by employers. He went on to take over as Governor and Commander-in-Chief of the Straits Settlements, including Singapore, a post his influential uncle had held.

  Married with three children, Sir Cecil retired from colonial service in 1934 and died in 1947. His obituary in The Times described his period as Governor of Hong Kong as ‘a great success, especially in regard to the restoration which it brought about of Anglo-Chinese friendship’. No mention was made of his attempt to become the biggest opium dealer in South-East Asia or his clash with his colonial masters.

  The factional fighting in China and the influx of Chinese refugees into Hong Kong and other colonies – with a subsequent dramatic increase in the number of opium addicts under British rule – was just the beginning of a major new trend in organised crime in the early twentieth century. Chinese gangsters and their political allies were making the most of the British Empire’s loss of control of the opium trade and were fast establishing their own power bases. Nowhere was this more clearly shown than in Shanghai – the most dazzling and most wicked of Far Eastern cities in the 1920s.

  7

  THE DEADLY INSPECTOR FAIRBAIRN

  MAURICE SPRINGFIELD LIKED HUNTING WITH hounds – both for sport and as Assistant Commissioner of Police in Shanghai. He used them to pursue gangs of robbers and, occasionally, other quarry.

  ‘By way of variation from robber hunting,’ he recalled, ‘I was once asked to try to find the corpse of a murdered Sikh, although 48 hours had already elapsed since the killing.’

  Springfield introduced his hound to a pool of blood and followed the scent towards a lagoon used by the Chinese for fishing. ‘Then followed what resembled an otter hunt on one of the Norfolk reedfringed lakes.’ His dog plunged into the water and swam back and forth over a particular spot in the lagoon. Springfield called the fire brigade to use grappling hooks, but they failed to find the corpse. Three weeks later, it floated to the surface.

  On another occasion, on 15 June 1924, Springfield was without his hounds when he had to confront a gang of armed robbers.

  ‘I had been playing tennis and was driving home,’ he remembered, ‘when I heard a series of shots.’

  As Springfield reversed out of a drive, an exhausted Sikh policeman flung himself against the car and handed Springfield a .45 revolver.

  ‘Sahib, Sahib,’ he gasped, ‘there they go!’

  Springfield held his fire as a ‘dear old lady’ stood between him and the escaping robbers. He ran after them and shot one dead. A second ran out of ammunition and was grabbed by the testicles by a rickshaw driver. As he yelled with pain, a Chinese woman hurled a pan of boiling water over him. Subdued, the robber was taken into custody by Springfield. He was part of a gang that was on its way to rob a wealthy Chinese merchant when the men were stopped by a policeman. A gunfight had subsequently broken out. For his fearless part in the arrest, Springfield was later sent a letter of gratitude from the Shanghai Municipal Council.

  From the way Springfield liked to record his days in the Shanghai Municipal Police, it might sound all larks and japes. But he was, in fact, a senior figure in the fight against organised crime in one of the wealthiest and most important ports in the Far East in the early twentieth century.

  Although not directly part of the British Empire, the International Settlement of Shanghai was headquarters to most of Britain’s business in China and, thanks to previous treaties, her citizens enjoyed extraterritorial status, which meant they were not subject to local Chinese laws but the jurisdiction of their own consuls. As far as most Britons in China were concerned, Shanghai was part of the empire and the Shanghai Municipal Police (SMP), run by Englishmen, looked after them.

  Springfield, originally born in Tipperary but raised in Norfolk, was 20 years old in 1905 when he joined the Shanghai Police Force. Then, Chinese men still walked around wearing their hair in pigtails, denoting their loyalty to the Qing Dynasty in Peking. Although it seemed immensely picturesque and exotic to the young man, he soon learned that Shanghai’s unique blend of 60 nationalities living close together could also be very violent.

  ‘Often there were as many as a dozen armed crimes a day,’ he noted. ‘At one time there were so many firearms in Shanghai it did not pay anyone to smuggle them in. Shanghai was a focal point for adventurers from all over the world and for soldiers of fortune.’

  Springfield worked his way up through several posts, including Registrar of the International Mixed Court, Governor of the Gaols and Assistant Commissioner of Traffic, until he became Anti-Narcotics Deputy Commissioner Uniform Branch. Shanghai played a pivotal role in the transit of illicit drugs around the world and it was up to Springfield to disrupt the flow. Needless to say, he approached the task with his usual enthusiasm.

  ‘The hunting for opium, morphia, heroin and cocaine smugglers and dealers was great fun,’ he said, ‘and was not confined to regular hours.’

  Springfield went on raids with his team of Sikh and Chinese policemen, but he was careful not to have the addresses of their intended targets written on the sheaf of warrants, as his clerical staff were often in the pay of opium dealers. Not only was he looking for shipments of drugs, but also documents that would give him a glimpse of the bigger picture of trading networks. On the night of 26 February 1924, he got very lucky.

  An informer had directed Springfield and his team to a small firm at 51 Canton Road. Rushing through the streets of Shanghai in two cars, they caught the manager of the hong in the building. As Springfield questioned him, the Chinese man got increasingly agitated and urinated down his legs. The chief of
narcotics demanded the man hand over the keys to his several safes, but he refused. Then one of Springfield’s Irish officers, searching the upstairs of the building, shouted out, ‘Here it is, sir. He’s been sleeping on it.’

  The policemen had wrenched off panelling and floorboards and taken apart furniture to discover half a stone of opium in a bed.

  At the news, the Chinese manager fainted. With the safes open, they found a small quantity of high-quality Indian opium and several phials of different drugs. Most importantly, they uncovered a treasure trove of documents in English, French and Chinese.

  ‘This case later became famous, with international repercussions,’ said the triumphant 39-year-old Springfield. The documents were translated and presented to court. ‘I think that copies in the region of 150 were printed and subsequently distributed to the famous Russell Pasha and all Consulates representing countries even remotely connected with the opium and other drugs traffic.’

  What came out of this pile of documentation and other high-profile cases was the worldwide reach of narcotics smuggling and how Shanghai was an important staging post in this process. Increasing evidence pointed to the role of Japan in this network. Too late to mollify the unfortunate Mr Hartley, who had been ruined by his supposed involvement in trafficking drugs into Japan, it appeared it was the Japanese who were acting as high-level smugglers into their own country.

  This was further confirmed by the case of Howard Montague Fogden Humphrey. A senior businessman in the City of London, Humphrey was convicted of drugs trafficking in 1923 and a letter to his Japanese contact was presented in court as evidence.

  ‘If you will entrust to my care a further £5,000 I will buy stock and come to Shanghai or any other Port with the goods,’ wrote Humphrey to the Japanese gentleman. ‘I am perfectly sure that we can deliver into any warehouse you wish quite safely and that by my own methods there is no fear of loss or confiscation or discovery.’

  Humphrey went to France to buy the processed morphine and cocaine and then had it shipped from Marseilles to China and Japan. It was hidden in barrels of printing ink and tins of food. Sometimes it was packed in tubes inside bars of luxury soap.

  ‘I would like to say that I have a perfect organisation,’ boasted Humphrey in his letter. ‘I have many friends amongst Customs etc. and I understand the business very thoroughly, in fact I do not believe that there is anyone who has a better control. In addition to this I am known to many of the buyers in Japan.

  ‘We buy, say, 50,000 ounces at 16/- [an] ounce – £40,000,’ explained the City businessman to his Japanese counterpart. ‘I am sure that we could easily sell this quantity in China at 48/- which would realise £120,000, the expenses to deliver to you safely would be about £1,000 including my Passage, therefore we could make a profit of about £79,000. If the goods were sold at this cheap figure, we might even get as much as 200/- per ounce and then we should of course make very much more.’

  In between sealing these global deals, Humphrey led the quiet life of a London commuter, travelling from and to his home in Brighton, arriving at Victoria station at 9.45 a.m. and getting back to his family at 7 p.m. each day. His Basinghall Street company made cutlery.

  Humphrey’s ‘perfect’ system broke down only when a ship arriving at Hong Kong was boarded by revenue officers and a Japanese subject was arrested. When they slashed open the upholstery on his shipment of sofas and armchairs, they found 2,400 ounces of morphine and 2,500 ounces of cocaine. It was reckoned that the amount of morphine would make 2,100,000 sellable doses. The documents carried by the Japanese passenger linked him to a Chinese firm in Amoy that had dealings with Humphrey. Once the documents were passed on to London, Humphrey was arrested and sentenced to six months in prison and fined £200.

  Dealers like Humphrey revealed the wide range of people involved in early narcotics smuggling. It wasn’t only the master criminals like Elie Eliopoulos. When processed drugs could be bought easily from pharmaceutical manufacturers in Paris and shipped on to the Far East, it attracted the civilised businessman whose only necessary qualifications were discretion, organisation and a good relationship with his bank manager. ‘All you have to do,’ said Humphrey to his Japanese contact, ‘is to wire the credit either here (London) or Paris to Barclays Bank Ltd and I will see to all the rest.’

  Outside of Europe, however, when illicit opium came from Persia or some other cultivator and was smuggled into China, it was a much more dangerous affair. Criminal gangs had to provide the muscle to protect their consignments from hijack. When Maurice Springfield had to deal with these gangs in Shanghai, it was less about following a paper trail and more about confronting gunmen.

  ‘In my day the dealers and purveyors to the public were cowards, although cunning,’ said the narcotics chief. ‘It was the smugglers who could be dangerous. But luckily for us they had never had practice or been trained in the handling of revolvers and automatic pistols and they were bad shots.’

  Springfield retired from Shanghai service in 1933, by which time he had risen to be Acting Commissioner. He returned to England and thoroughly enjoyed a life hunting in Norfolk with his beloved hounds. He was fortunate to get out with a few good stories; in the 1930s, events in China took a darker turn, as organised crime was forced to ally itself with increasingly perilous politics. This would demand a much more aggressive response from the SMP.

  In the first decades of the twentieth century, Shanghai was a fun city and prided itself on its modernity, with multi-storey buildings rising along the waterfront of the business quarter – the Bund – while flickering neon lights illuminated Nanking Road, its premier shopping street lined with western-style department stores. There was the seedy side too, catering to all tastes, and even here, the British were considered to be in charge.

  ‘Prostitutes of all nationalities flocked into Shanghai from Japan, Siberia and the North, and one part of the Settlement appeared to be peopled almost entirely by Russian women,’ noted one report in 1927. ‘Men were constantly solicited as they walked through the streets, by women who called from windows. The streets in certain quarters were patrolled by amahs [housemaids] accompanied by young girls, for whom the amahs solicited custom. In one part of the Nanking Road these could be counted by the score at night. Brothels sprang up in houses next to British billets, and I was asked by a Japanese to introduce him “to the Colonel”, as he wanted permission to start a brothel.’

  Rickshaw men were subsidised by brothel-keepers and would ask gentlemen whether they wished to visit a Chinese or a Japanese house. Chinese and Japanese restaurants were often used as places of assignation. Sometimes there would be a moral crusade in the city, initiated by do-gooder American Protestants, and raids would be ordered to close down the sinful places, but vice continued to dominate the city streets into the 1930s.

  Early pornographic films were screened and one Yorkshire-born British visitor described attending such a cinema at the Bubbling Well end of Nanking Road. ‘The entrance hall was like the hall of a large private house and was sumptuously furnished,’ he recalled. ‘There was a picture being shown at the moment, and when I looked at the screen I got a shock. The picture was horribly lewd, not just ordinarily suggestive, but absolutely as lewd as it is possible to make.

  ‘I could see that there were a few good ladies among the audience, and one of them, a young woman of some continental nationality who spoke English with an accent, came and sat down beside me, first asking my permission with a wide smile, which exposed three or four gold teeth … Another picture, even worse than the last one, was put on the screen, after which the young lady moved away to another seat, probably thinking that I was no sport.’

  The French Concession – a neighbouring colonial possession with jurisdiction separate to the British-run International Settlement – got a bad reputation for harbouring drug dealers. In July 1926, the manager of a popular pharmacy was arrested and made a statement saying that 7,000 ounces of morphia and heroin had been ordered from German
y through a Japanese agent and the drugs were stored in various premises in the French Concession. The manager was handed over to a Chinese Military Court, found guilty and executed by firing squad.

  The French authorities took a different approach from the British and thought it was sensible to license opium dens and receive an income from it. As a result, their territory became a base for Chinese mobsters and earned a reputation for pushing the boundaries of decadence in Shanghai. At its centre was the brash ‘Great World’ entertainment centre, run by a Chinese gangster with police connections. The Great World offered a variety of pleasures:

  The fifth floor featured girls whose dresses were slit to their armpits, a stuffed whale, story-tellers, balloons, peep shows, masks, a mirror maze, two love-letter booths with scribes who guaranteed results, rubber goods, and a temple filled with ferocious gods and joss sticks.

  ‘As I tried to find my way down again,’ continued a curious western visitor to the Great World, ‘an open space was pointed out to me where hundreds of Chinese, so I was told, after spending their coppers, had speeded the return to the street below by jumping from the roof. When I guilelessly asked why a protective rail had not been placed around an exit so final, the retort was, “How can you stop a man from killing himself?”’

  Throughout Shanghai, arms trafficking was endemic, and in one five-month period in 1926 the SMP arrested 19 Europeans and 26 Chinese dealing in weapons and seized 181 automatic pistols and revolvers and over 17,000 rounds of ammunition. It was the wildly escalating use of guns that encouraged William Fairbairn, a leading Shanghai police officer, to develop new methods of policing. These would anticipate the modern age of SWAT squads.

  ‘These views are the outcome of many years of carefully recorded experience with the Police Force of a semi-Oriental city,’ wrote Fairbairn in his gun-techniques book called Shooting to Live, ‘in which, by reason of local conditions that are unusual and in some respects unique, armed crime flourishes to a degree that we think must be unequalled anywhere else in the world.’ And this was at a time when American gangsters were shooting their way to notoriety in US cities.