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AUSTRAC information helps crack drug importation ring

Image of clandestine lab

A joint-agency law enforcement investigation identified a number of individuals and organised crime syndicates involved in importing drugs into Australia via the postal system. The investigation found that Australian-based suspects used remittance dealers to transfer funds offshore to pay for drug importations.

This nation-wide law enforcement operation resulted in the arrest of 24 individuals in Australia and three individuals in South America. The latter were members of a Colombian-based drug syndicate. A further 22 individuals were not Australian citizens and were referred to immigration authorities.

The following indicators may help identify this or similar criminal activity:

Indicators

  • Multiple ordering customers sending international funds transfers to the same, or similar, beneficiary customer
  • Individuals sending international funds transfers from specific Australian locations to a common destination region in China
  • Significant cash deposits followed by outgoing international funds transfers of similar amounts
  • Variations of addresses and names used to conduct multiple IFTI transactions

Investigation outline

Investigators identified drugs were being imported into Australia. Many of those involved in the importations were Chinese nationals, based in Australia. Authorities also suspected that some shipments were being imported by organised crime syndicates whereas others were found to be opportunistic importations undertaken by individuals operating on their own.

The Australian-based suspects used mobile phones and the internet (via chat rooms and email), liaised with Chinese companies to organise drug importations. The suspects then sent international funds transfer instructions (IFTIs), usually via a remittance dealer, to companies in China. These companies then posted drugs to a variety of names and addresses in Australia.

AUSTRAC information identified that the outgoing IFTIs, generally valued between AUD1,000 and AUD10,000, usually corresponded with the value of each drug importation.

Industry contribution

Law enforcement identified a number of characteristics of the syndicate's operations:

  • The Australian-based suspects sent IFTIs to Chinese companies or to seemingly unrelated Chinese individuals. This made it difficult to link the beneficiary customer in China with the entity in China which actually sent the package
  • Suspects paid for the IFTIs with in significant cash deposits. The outgoing transfers to China were for similar amounts to cash being deposited, and many were made using the same remittance service.
  • AUSTRAC information also revealed that IFTIs were sent from specific Australian geographic locations to a common destination region in China.
  • The Chinese beneficiaries mailed the drugs, via sea or air, to Australian-based suspects who sent the IFTIs. Australian-based suspects also purchased chemicals from chemical companies in China to manufacture drugs.

If packages were intercepted, companies in China re-sent the drugs using different sender and recipient information in an attempt to avoid further detection.

Law enforcement in Australia conducted a number of operations, which resulted in arrests in Australia and South America. Law enforcement also seized:

  • more than 73 kilograms of drugs
  • 145 parcels
  • approximately AUD153,000 cash (suspected to be the proceeds of crime)
  • counterfeit licences
  • DVDs and CDs and;
  • improvised weapons and drug-making equipment. |

The investigations also uncovered two clandestine drug laboratories.

The operation also assisted South American authorities to dismantle a Colombian-based drug syndicate that was allegedly importing cocaine into Sydney though the postal system.

AUSTRAC contribution

AUSTRAC provided law enforcement with vital financial intelligence to assist investigations. AUSTRAC analysis identified a group of common beneficiaries in China who had received funds from Australian-based entities who were known to have received drug parcels. Further analysis identified additional suspects in Australia who were sending IFTIs to the same beneficiaries in China.

Outcome

The operation resulted in the execution of 78 search warrants and 27 individuals arrested; 24 individuals in Australia and three individuals in South America.

A further 22 individuals non-citizens were referred to Australian immigration authorities.

Summary

Offence Drug importation
Customer

Individual

Business

Industry Remittance services (money transfers)
Channel

Electronic

Physical

Report type IFTI
Jurisdiction

Domestic

International – China, Colombia

Designated service Remittance services (money transfers)
Last modified: 26/02/2016 10:29