BURMA: NE WIN'S DAUGHTER RELEASED; KHIN YI

C O N F I D E N T I A L SECTION 01 OF 02 RANGOON 000942

SIPDIS

STATE FOR EAP AND IO; PACOM FOR FPA

E.O. 12958: DECL: 12/14/2018
TAGS: PGOV PREL PHUM BM
SUBJECT: BURMA: NE WIN'S DAUGHTER RELEASED; KHIN YI
PROMOTED; TAY ZA'S GAMBLING DEBTS

Classified By: Pol Officer Sean O'Neill for Reasons 1.4 (b) & (d)

Summary
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1. (C) On December 12 authorities released the daughter of
Burma's former dictator Ne Win from over six years under
house arrest. A senior police official told our DEA Country
Attache that Director General of Police Khin Yi has been
appointed a Deputy Minister with the Ministry of Home Affairs
but will retain his police duties. The same police contact
reported that regime crony Tay Za owes indicted narcotics
trafficker Hsiao Ho USD 10 million for wagers on soccer
matches and may pay the debt with assets from his holding
companies. End summary.

Ne Win's Daughter Released
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2. (U) Contacts reported to us on Saturday that security
officials released Sandar Win, daughter of Burma's former
dictator Ne Win, from house arrest on Friday, Dec. 12.
Police later confirmed the news. Sandar Win, now in her 50s,
has spent the past six years and nine months under house
arrest in Rangoon on charges of treason for allegedly
plotting a coup. Her husband and three sons were sentenced
to death for the same crime and remain in prison while they
appeal. A police official told AFP that Sandar Win was
released because her authorized period of detention had
expired. Ne Win ruled Burma from 1962 until 1988 after
staging a coup against U Nu, Burma's first elected leader
since independence.


3. (C) Comment: Legal interpretations of Burmese law differ
on the maximum allowable house arrest, but all seem to agree
that the outer limit is six years. Sandar Win's confinement
extended beyond, but has now ended. Aung San Suu Kyi will
reach six continuous years under house arrest May 29, 2009.
It will be instructive to observe how the regime responds at
that time. End comment.

Khin Yi Promoted
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4. (C) A senior police official told our DEA Country Attache
that Director General of Police Khin Yi was appointed a
Deputy Minister of Home Affairs in late November or early
December. According to DEA's contact, Khin Yi retains his
duties as Director General of Police and will now be one of
two Deputy Home Ministers, along with Phone Swe (Note: this
is not uncommon; MFA also has two deputy ministers).


5. (C) A Pol/Econ contact who used to teach English to Khin
Yi also reported the recent move and relayed speculation that
Khin Yi's new appointment is part of a plan by the regime for
Home Minister Maung Oo to resign his position in order to
form a political party in advance of the 2010 elections.
According to this source, current Deputy Home Minister Phone
Swe would become Home Minister while Khin Yi would head up a
newly-created Ministry of Public Security. However, our
contact acknowledged that the regime has not as yet publicly
commented on this or any other rumors concerning preparations
for the 2010 elections.

Tay Za's Costly Wager
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6. (C) DEA's police contact also reported that regime crony
Tay Za owes indicted narcotics trafficker Hsiao Ho USD 10
million from numerous gambling wagers on English Premier
League soccer matches. DEA believes Hsiao Ho is currently in
Burma or China. In March 2007, Chinese authorities released
him from a Hong Kong jail, where he was awaiting extradition
to the United States. Hsiao Ho was indicted by the U.S.
District Court for the Eastern District of New York in
December 2004 on narcotics trafficking charges. DEA's police
contact speculated that Tay Za may attempt to settle his debt

RANGOON 00000942 002 OF 002


by transferring assets or concessions from his companies to
entities controlled by Hsiao Ho.
DINGER