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OO RUEHCHI RUEHDT RUEHHM RUEHNH
DE RUEHGO #0386/01 1750605
ZNY CCCCC ZZH
O 240605Z JUN 09
FM AMEMBASSY RANGOON
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RUEKJCS/SECDEF WASHDC C O N F I D E N T I A L SECTION 01 OF 03 RANGOON 000386 
 
SIPDIS 
 
STATE FOR EAP/MLS, INR/EAP, EEB/TFS 
PACOM FOR FPA 
TREASURY FOR OASIA, OFAC 
 
E.O. 12958: DECL: 06/24/2019 
TAGS:            
SUBJECT: BURMA: SANCTIONING TAY ZA'S RIGHT-HAND MAN 
 
REF: A. 07 RANGOON 328 
      B. RANGOON 134 
      C. RANGOON 20 
 
RANGOON 00000386  001.2 OF 003 
 
 
Classified By: Economic Officer Samantha A. Carl-Yoder for Reasons 1.4 
(b and d). 
 
Summary 
------- 
 
 1.  (C)  Lu Lu, a.k.a. Kwan Lu Chan, Chan Kwan Lu, and Zaw 
Min, is Vice Chairman of Air Bagan and regime crony Tay Za's 
top assistant and advisor.  Known in business circles to be 
cunning and ruthless, Lu Lu boasts to businessmen that he 
taught Tay Za "all he knows."  Tay Za often designates Lu Lu 
to entertain high-ranking GOB officials and coordinate their 
travel abroad.  Of Burmese-Chinese origin, Lu Lu is Tay Za's 
liaison to Chinese partners and potential investors, and 
allegedly set up different firms in China on Tay Za's behalf. 
 Lu Lu also owns several companies on his own.  He is married 
to an American citizen and allegedly holds a green card. 
Based on his important position with Tay Za's organization, 
providing political and economic support to the regime, 
Embassy Rangoon recommends that the Department of the 
Treasury add Lu Lu, his family, and his companies to the 
targeted sanctions list.  End Summary. 
 
Tay Za's Key Advisor 
-------------------- 
 
 2.  (C)  Tay ZQhas been the regime's top crony since 2005, 
after the fall of former Prime Minister Khin Nyunt.  Tay Za 
used his connections to the regime to secure his favored 
position (Ref A), and he relies on key personnel within the 
Htoo Group of Companies to ensure that his businesses remain 
viable while providing support to the senior generals when 
necessary.  According to several economic contacts, Lu Lu is 
Tay Za's right-hand man.  George Soon, owner of Singapore 
Company Regent Air, told us that Lu Lu, who has been friendly 
with Tay Za for more than 20 years, often boasts that he 
taught Tay Za "all he knows," including how to curry favor 
with the senior generals. 
 
 3.  (C)  Lu Lu is currently the Vice Chairman of Air Bagan, 
and until October 2007 held the position of Vice Chairman of 
Htoo Group of Companies, Tay Za's umbrella organization that 
manages more than 20 firms, Soon told us.  Lu Lu is also a 
minority shareholder in Pavo Trading, one of Tay Za's 
companies based in Singapore that exports timber, marine 
products, cement and other construction materials.  According 
to Embassy contact Anwar Hussein, Lu Lu relinquished his Htoo 
Company title in October 2007 because he was afraid of being 
sanctioned by the USG. 
 
 4.  (C)  Lu Lu retained his position at Air Bagan because he 
has a genuine interest in aviation and the position affords 
him power and influence with the regime, Soon explained.  Lu 
Lu has brokered several aviation deals on behalf of Air 
Bagan, including arranging charter flights for key regime 
officials to Singapore, Korea, China, and other destinations, 
Myanmar Airways International General Manager U Aung Gyi 
informed us.  Lu Lu also recently attempted to purchase a new 
A320 from a Dubai company on behalf of Air Bagan, although 
the deal appears to have fallen through (septel).  Soon 
confirmed that, as Vice Chair of Air Bagan, Lu Lu coordinates 
 
RANGOON 00000386  002.8 OF 003 
 
 
travel arrangements for the senior generals and their 
families and often accompanies them on trips to Singapore. 
According to Soon, Lu Lu is unwilling to give up this access 
to the regime elite. 
 
Business Acumen 
--------------- 
 
 5.  (C)  Although Lu Lu obtained his position in the Htoo 
Group of Companies based on his friendship with Tay Za, Soon 
says Lu Lu has a strong business sense despite the lack of 
formal business training.  Using his connections and his 
ability to achieve profitability, Lu Lu assists Tay Za by 
ensuring that the Htoo Companies are the first ones the 
regime looks to when it has new projects or needs a "favor," 
Embassy contact Brett Melzer confirmed.  (Note:  Lu Lu was 
Melzer's first point of contact during the sale of the 
Malikha Lodge in January 2009 - Ref B.  End Note.) 
Additionally, Lu Lu uses his fluent Chinese language skills 
when acting as a broker to secure Chinese investment in 
Burma.  Glen Ford, Acting General Manager of Myanmar Ivanhoe 
Copper Co. Ltd., told us that Lu Lu, working on Tay Za's 
behalf, acts as liaison with several Chinese companies 
interested in acquiring MICCL's shares in the Monywa copper 
mines (Ref C). 
 
 6.  (C)  Lu Lu also has business interests separate from the 
Htoo Group of Companies, Soon told us.  He owns several jade 
and gem mines in Phakhant and Mogok, selling high-quality 
gems to the senior generals' wives.  According to Brett 
Melzer, Lu Lu is a minority partner with Tay Za in two 
Chinese companies, Cheung Hing Corporation Ltd. and Cheung 
Hing Timber Corporation, and maintains bank accounts with 
HSBC Bank in Hong Kong. 
 
Weapons Smuggling? 
------------------ 
 
 7.  (C)  Rumors abound that Tay Za has long smuggled Chinese 
weapons into Burma via his aviation and trading businesses. 
Soon alleges that Lu Lu, who has close ties to the senior 
management of Chinese firm Norinco (an alleged arms dealer 
that has business dealings in Burma), is the mastermind 
behind Tay Za's involvement in the arms trade.  According to 
Soon, Lu Lu introduced Tay Za to Norinco officials and has 
secured several business agreements between Htoo Trading and 
Norinco, including a partnership for a gold mine in Mandalay 
Division and a broker contract for Norinco's planned purchase 
of MICCL (Ref B). 
 
Biographical and Business Information 
------------------------------------- 
 
 8.  (C)  Born in Burma in 1962, Lu Lu holds a Burmese 
passport.  However, he allegedly holds a U.S. Legal Permanent 
Resident card in the name Zaw Min, deriving his status from 
his American Citizen wife Khin Khin Aye.  Lu Lu allegedly 
also uses the names Kwan Lu Chan and Chan Kwan Lu, Embassy 
contacts confirm.  Although Lu Lu previously lived in 
Singapore, he recently moved his residence to Burma and 
resides at one of Tay Za's homes in Rangoon. 
 
 9.  (C)  The following is contact information for Lu Lu's 
businesses in Hong Kong.  Pavo Trading, in which he is an 
investor, is already listed on the Department of the 
 
RANGOON 00000386  003.2 OF 003 
 
 
Treasury's targeted sanctions list. 
 
-- Cheung Hing Corporation Ltd., 4/F Wai Hing Building, 146 
Prince Edward Road, Prince Edward, Kowloon, Hong Kong; Phone: 
 85-2-2381-2547; Fax: 85-2-2391-1790. 
 
-- Cheung Hing Timber Corporation; 4/F Wai Hing Building, 146 
Prince Edward Road, Prince Edward, Kowloon, Hong Kong; Phone: 
 85-2-2381-2547; Fax: 85-2-2391-1790. 
 
Comment 
------- 
 
 10.  (C) As a trusted advisor of regime crony Tay Za and Vice 
Chairman of Air Bagan, Lu Lu provides significant economic 
and political support to the regime.  Embassy Rangoon 
recommends that the Department of the Treasury Office of 
Foreign Assets Control add Lu Lu, his family, and his 
companies to the targeted financial sanctions list. 
 
 
 
DINGER