El Monte police first discovered an illegal casino at Pacific Place, a gated complex, in December 2021. They found electronic gambling tables, cash, and several pounds of methamphetamine.
Over three years, police raided the property four additional times, uncovering a gambling parlor, a marijuana stash house, and a psilocybin mushroom grow operation. However, the most startling discovery occurred in the nearby city of Arcadia.
When police searched the property owner’s mansion in Arcadia, they found 15 children, most of them toddlers. Guojun Xuan, the 65-year-old owner, claimed he was their father. Almost all of them were born to surrogates.
Arcadia police became involved due to concerns over possible human trafficking. Detectives asked the FBI to investigate after it was discovered Xuan and his partner, Sylvia Zhang, transferred money to surrogates and traveled across state lines to collect the children.
Xuan’s link to the El Monte property added to the mystery. He could have been an unwitting landlord to criminals. Records show his companies evicted tenants who participated in illegal activities. No charges have been filed against Xuan or Zhang.
Neighbors in the suburb were mystified by the large family discovered in Xuan’s home. Some media outlets speculated wildly, calling the home a “twisted baby factory.” However, after the initial headlines, the mystery faded from public view.
Legal Actions and Investigations
In September, El Monte filed a civil abatement claim against Xuan, alleging that the property was part of a “sophisticated and persistent criminal enterprise.” Police found drugs, guns, counterfeit currency, and other illegal items during raids.
A detective wrote that police initially learned of Xuan’s Pacific Place property in 2021 from tips about it operating as a “possible illegal nightclub.” This led to a series of raids.
Xuan acquired the property in 2019 for $10.5 million through Hongxing Investment. It’s known as the headquarters for Xuan’s extensive real estate business.
Arcadia Discovery and Child Welfare Concerns
Issues in Arcadia became apparent in May 2023 when a 2-month-old boy, one of Xuan and Zhang’s children, was admitted to a hospital with injuries. The child’s injury prompted an examination of the family’s home, revealing a school-like atmosphere with several live-in nannies caring for the children.
Footage from the home showed a nanny abusing children. Police arrested Xuan and Zhang for neglect but prosecutors did not file charges.
Arcadia police obtained warrants to review more surveillance footage, hoping to gather enough evidence for child abuse charges.
While the police focus on potential child abuse, they haven’t fully explored the legality of the surrogacy arrangements. The Los Angeles County Department of Children and Family Services currently has custody of the children.