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AUSTRAC helps bust money laundering syndicate

Image on money being handled by someone in gloves

A law enforcement investigation identified a professional money laundering syndicate operating between Australia, New Zealand and China.

The investigation revealed the offender flew to Australia from New Zealand and two days after arriving attended a casino. There she received AUD624,340 in cash in a backpack from an associate (suspect A) in the casino car park and deposited it into her casino account. After unsuccessfully attempting to transfer a portion of the funds from her casino account to the bank account of another associate (Ms X), the offender withdrew AUD300,000 in cash and attended a bank. There she attempted to deposit the cash with the intention of transferring it to Ms X who worked for an Australian money remittance business based in a different state. The offender was unable to provide satisfactory information when questioned by bank staff as to the origins of the cash and purpose of the transaction. As a result of the law enforcement investigation the offender was arrested at the bank attempting to deposit the cash.

The offender was charged with one count of dealing with more than AUD100,000 that it was reasonable to suspect was the proceeds of crime and was sentenced to 16 months imprisonment. 

The case study involves the use of casino accounts to deposit and then withdraw large amounts of cash for money laundering purposes.

The following indicators may help identify similar criminal activity:

  • A large cash deposit into a casino account that is inconsistent with previous betting account activity
  • Deposited banknotes into a casino account in poor condition, e.g. appearing soiled or gritty
  • A large cash deposit into a bank account where the cash is bundled in AUD100 and AUD20 bill denominations
  • A large cash deposit into a casino or bank account where the customer provides ambiguous information on the origins of funds and has used a foreign passport as a form of identification when opening the account
  • Customer making multiple large domestic bank transfers from their account to a different individual's account over a short period, and subsequently receiving funds back into their account from the same individual during the same period

Investigation outline

Two days after flying to Australia from New Zealand the offender attended a casino. The purpose of the trip was to meet a conduit (suspect A), who was acting on behalf of the offender's brothers in China. Suspect A provided the offender with a backpack in the casino car park, which contained AUD624,340.

The offender deposited those funds into her casino account and requested AUD200,000 be transferred to a personal account, in the name of Ms X who worked at an Australian money remitter*. This transfer was declined by casino staff. The next day the offender withdrew AUD300,000 from the casino account before going to a bank to deposit the cash into her own account, with the intention of transferring it to Ms X. The offender was unable to explain the source of the funds when questioned by bank staff and was subsequently arrested by law enforcement attempting to deposit the cash into her bank account. The investigation revealed the offender intended to transfer the AUD300,000 to Ms X who would then transfer the funds to the offender's brother in China.

Law enforcement also examined the phone belonging to the offender and found instructions from her son to transfer the funds to Ms X. The offender and her son worked for a money remitter in New Zealand, however the nature of their relationship to Ms X was not determined. When law enforcement authorities identified suspect A they conducted a search warrant at his residence where cartons of illegal cigarettes were located. It was not established whether the AUD624,340 suspect A gave to the offender was proceeds from the sale of illegal cigarettes/tobacco or derived from other criminal activity. This tobacco was voluntarily surrendered and destroyed by law enforcement authorities.

Authorities restrained:

  • AUD300,000 in the possession of the offender at the bank, which was then forfeited
  • AUD324,340 from the offender's casino account, which was then forfeited

Industry contribution

Four SMRs were submitted to AUSTRAC in relation to the offender's financial activity prior to her arrest. These noted:

  • A highly unusual cash deposit into the offender's casino account. The offender deposited AUD624,340 and claimed the funds came from 'a property'.
  • The offender requested the casino to transfer AUD200,000 to the account of Ms X, which was declined. The next day the offender then withdrew AUD300,000 in cash and stated she would go to the bank.
  • The offender handed AUD300,000 to a bank teller in AUD100 and AUD20 denominations. The offender was unable to provide satisfactory information regarding the origin of the cash, at which time it was seized.
  • The offender was the recipient of AUD45,010, AUD20,000 and AUD30,000 transferred from her son's domestic bank account in a three week period from the day of the offence. In the same period the offender transferred AUD70,000 from her account into her son's domestic bank account in a single transaction.

AUSTRAC contribution

AUSTRAC conducted searches of the AUSTRAC Remittance Sector Register in relation to the offender and her family members/associates. AUSTRAC provided a statement to support the prosecution, as well as providing evidence in court.

Outcome

The suspect was found guilty at trial and sentenced to a fixed term of 6 months imprisonment. This decision was appealed by the Crown and the sentence was increased to 16months with a minimum of 12 months.

Summary

Offence

Money laundering

Customer

Individual

Industry

Gaming services

Authorised deposit-taking institution (ADI)

Channel

Electronic

Physical

Report type

SMR

TTR

Jurisdiction

Domestic

International - New Zealand and China

Designated Service

Account and deposit-taking services

Gaming services

* Please note: Neither Ms X nor the money remitter for whom she is employed, have been implicated or charged with offences in conjunction with this investigation.

Last modified: 24/06/2016 16:44