'Million-Dollar' Madam Allegedly Pimped Kids

"We don't have a lot of prostitution of this nature in Denver," police say.

Aug. 11, 2008— -- A two-year investigation by the Denver Police Department has led to the arrest of a suspected madam who authorities said ran a million-dollar prostitution ring that offered the sexual services of up to 50 women and children.

Hong Tang, 28, was arrested at her suburban Denver home Friday by members of the police vice unit. She has been charged with nine felony counts that include pimping, pimping of a child and keeping a place of prostitution, police said.

She was arraigned Saturday and is being held on $500,000 bail at the Denver City Jail. It is unclear whether Tang has hired an attorney.

"We understand that she was using juveniles to work for her and she was bringing in females from other states," Sonny Jackson, a Denver police spokesman, told ABCNews.com.

Authorities estimated that Tang's business generated about $1 million annually and has been active since 2005, police said. Several minors were involved in what Jackson described as an escort service.

"It does make it even more of a concern to have juveniles working or being complicit in a crime like this," Jackson said. "We don't have a lot of prostitution of this nature in Denver."

In a search of Tang's home Friday, police recovered more than $30,000 in cash, large quantities of condoms and sexual lubricants, and computers that may have been used in the operation, Jackson said.

Citing the ongoing investigation, Jackson would not say whether the sex-for-money services were offered online or in classified ads or where the actual prostitution occurred in the city.

Authorities have also frozen several bank accounts tied to Tang, including one "containing an estimated $316,000," according to police. Police will seize Tang's 2006 Toyota Corolla and 2007 Honda CRV, as well as her residence. All three are paid off and worth an estimated $400,000.

Early Saturday morning, Denver police arrested Todd Allen Powell, 44, in connection to the alleged prostitution ring. Powell, described by Jackson as a business partner in the operation, was hit with pimping and conspiracy charges.

Powell, who was arraigned Sunday, is also being held on $500,000 bail at the Denver City Jail, according to jail records. It is unclear whether he had hired an attorney.

Jackson declined to offer additional details about the investigation before prosecutors from the Denver District Attorney's Office finalize the charges against the pair.