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After Japan's surrender in 1945, China announced its intent to reclaim its rights to the Walled City.Refugees from mainland China because of the Chinese Civil War post 1945 poured in to take advantage of British protection (the Walled City was a Chinese territory but surrounded by British land), and 2,000 squatters occupied the Walled City by 1947.
The Protestant church established an old people's home in the old "yamen" (Chinese meaning administrative office) as well as a school and an almshouse in other former offices.
By this time, however, the Walled City was virtually ruled by the organised crime syndicates known as triads.
Beginning in the 1950s, triad groups such as the 14K and Sun Yee On gained a stranglehold on the Walled City's countless brothels, gambling parlors, and opium dens.
As a result, the Qing authorities felt it necessary to improve the fort in order to rule the area and check further British influence.
The improvements, including the formidable defensive wall, were completed in 1847.