We were sitting chatting to Peter and his family after breakfast the next morning when the call came. Code Red. The police were in the village; we had to clear out. We ran to the cabin to grab water and a book, and to remove drying towels, swimming togs etc off the deck, close all the shutters and lock the door. No one staying in this cabin, officer. Then we ran to the beach and hurried the kilometre or so to the far end. The owners did the same - it was much easier not to be around when the police came, Peter said. No awkward questions to answer about why they were living at a closed resort.
The others sat behind a rock on the sand, but the intrepid NZ party ventured into the trees where we found a mighty fine covered bamboo platform - maybe something used by fishermen during the hot part of the day. There were enough discarded bottles and bags lying underneath to know it served some local purpose. We stayed there for a couple of hours, reading and snoozing. Then we saw one of the local staff cycling slowly down the beach with the All Clear. The police hadn't found anything untoward and had gone back through the village. We were free to head back. A big sigh of relief, particularly for the owners, who could face big fines or even jail for operating without a licence. However, I have to admit that not being any real danger ourselves, our brush with the law was all rather exciting.
Post script: Just to add to the drama, that afternoon, a group of half-a-dozen tourism officials turned up to stay at the bungalows, accompanied by one of Peter's Burmese joint venture partners. Peter was decidedly nervous and called them "police" too, only not the same ones as those sent the day before by the (according to Peter) "anti-foreigner local bureaucrat that wants the guesthouse gone". The general view here is that all officials in Burma are police or military.
The men were friendly but asked awkward, if understandable, questions about why we were here and how did we knew about this place, since it was closed because it hadn't got a licence. They also quizzed us about why we liked the beach and the area, allowing us to stress the lack of development, the peaceful atmosphere and the pristine beach. One bespectacled man who was something to do with tourism development for an airline in faraway Bagan, talked about eco-tourism and picked up rubbish from the sand and put it in the bin. It was all very odd and a bit encouraging.
Still, we worried about what we would do if the local police decided to sneak back and do a second raid. We could hardly all scarper down the beach with the national tourism officials watching. We shall never know. The police didn't come back and the next day we left too.