$500,000 a pop:  the price you pay in organised crime  -  SMH  - Nick Ralston - 2017

More money means more violence – but Sydney’s organised criminals never let murder get in the way of business.

As he walked down a street in Sydney’s CBD, his backpack looked ordinary, but the contents were anything but: half a million dollars in cash was stashed inside.

The money, however, wasn’t what most piqued the interest of the police who stopped him – it was a series of photographs of $5 notes on his phone.

Police suspected that the large quantity of cash was part of a payment for a drug importation that had been sent to Sydney. The money was to be laundered and sent overseas.

The $5 notes on his phone were “tokens” – the way to secure trust in large-scale, high-level drug deals. The person he was to meet to hand the $500,000 cash to was to be holding a $5 note with a serial number that matched one in his phone.

Investigators found photographs of at least 30 $5 notes on his phone and believe the man had been involved in that many cash drops in recent weeks, totalling $16 million.

A relatively unknown criminal carrying thousands of dollars in a backpack through the streets of Sydney highlights the big money being made and moved by organised crime.

“The motives for organised crime murders haven’t changed,” NSW Police Assistant Commissioner Mal Lanyon says. “They generally relate to a dispute over contested turf, where people supply illicit commodities, or it will be over something to do with illicit trade.

“Whether that be drug supply, firearms supply or ownership of a particular criminal group.

“As to whether people from overseas are involved in that, I would say little doubt,” Lanyon says. “They are largely orchestrating the criminal activity that is occurring in NSW; there is little doubt they would also have influence in what is happening with organised crime murders in NSW.”

Mourners at the funeral of Safwan Charbaji who was shot at a smash repair shop. Photo: Daniel Munoz
 
 

Truce or dare

In one of the largest NSW police investigations in recent times, eight of these loosely linked murders were brought together under Strike Force Osprey in 2016. The investigation, which is ongoing, includes the killings of Pasquale Barbaro, Hamad Assaad, Walid “Wally” Ahmad, Safwan Charbaji, Mark Easter, Michael Davey, Adrian Buxton and Mehmet Yilmaz.

The recent outbreak in violence has been linked to a feud between two crime families, the Elmirs and the Ahmads, who control drug turf in Sydney’s south-west.

Among those killed have been convicted killer and standover man and Walid “Wally” Ahmad, a big figure in Sydney’s underworld scene shot dead weeks after a heated argument turned into a deadly gunfight at his smash repair business at Condell Park. Safwan Charbaji, an associate of the Elmir family, was shot in that Saturday afternoon shootout at A Team Body Works.

The-tit-for-tat violence that ensued forced senior figures in the Ahmad network and the Elmir clan to meet in an attempt to broker a truce. Ahmad "Rock" Ahmad was there and Steven Elmir, the son of fugitive and convicted cocaine trafficker Fawaz Elmir, was involved in the discussions.

Police had repeatedly told members of these families the violence couldn't be good for their businesses. Criminals were less likely to deal with groups under intense scrutiny.

Whether a truce was reached that day is unclear. However, a few months later, Steven Elmir and Rock Ahmad were arrested in a major transnational drug sting targeting some of Sydney's most notorious players.

It is an example of the fluidity of Australia's organised crime networks, where hostility forged over the loss of close friends and family members does not discount the opportunity to make a dollar.


Pasquale Barbaro (centre) was shot dead in Earlwood in 2016.
 

The end of the kingpin

The changing nature of organised crime was evident in a major covert police sting known as Strike Force Taipan. Criminals of Middle Eastern background, including a hitman; a member of the beachside surf gang the Bra Boys; an allegedly compromised Australian Federal Police officer; bikies and a corner-store owner were among the targets arrested over the course of the two-year investigation. Criminals from all backgrounds and allegiances were doing business with one another. Any loyalties they had to clubs, family or ethnicity no longer mattered.

Twenty years ago, Rebels bikies did business with Rebels bikies, or Anglo-Saxon criminals. Now they were wheeling and dealing with Asian organised criminals and using the same intermediaries as rival gangs.

The strike force was a turning point for police in NSW; it reaffirmed the developing view that organised criminals had changed the way they operated. The concept of a Mafia-style hierarchical group headed by a kingpin was no longer relevant.

Undercover officers spent three months assuming the lives of two mid-level drug buyers. They built a rapport with an influential source – a martial arts expert who emerged as a middleman between several drug syndicates.

The undercover officers started buying small amounts – a kilogram here, two kilograms there – to test the waters. Then it was time for a much larger haul, $1.8 million worth.

“The time is now 10.10am on August 29, 2013 and this is [undercover officer 1] using the assumed name of Tony,” the officer says, clearly enough for the hidden recording device to capture. “For Strike Force Taipan, I'm about to have a meeting with Kamra Zolfonoon to conduct a purchase in the Kingsgrove area.”

What follows is a delicate and dangerous operation that brought down two primary targets for Strike Force Taipan.

Influence in this crime syndicate rested in the intermediaries, the mid-level people with extensive contacts who brought major players together.

Zolfonoon, a married father-of-one who studied electrical engineering at university, facilitated the exchange of $1.8 million in cash bound with elastic bands.

Jay Wilson, a tradesman from Campbelltown, had agreed to supply the drug for a price of $225,000 per kilogram.

Zolfonoon was not a kingpin, he didn't drive a flashy car and nor did he have millions of dollars. He wasn’t part of a crime family dynasty. He worked at his brother's Persian rug shop and had a young daughter.

But he had connections and used those to source copious amounts of ice, heroin and cocaine for criminals from all walks of life.

He was the cog in many wheels, moving seamlessly between groups, regardless of traditional boundaries, making deals with whoever had the money.

Two years later, Wilson was sentenced to 10-and-a-half years behind bars, with a non-parole period of six years, for his role in the drug supply.

Zolfonoon was serving a minimum of 10 years’ jail for his role in helping organise this exchange and three other large-scale deals over the course of 18 months.


Kamra Zolfonoon under police surveillance in Kingsgrove in 2013. Photo: NSW Police
 

Zolfonoon dealt with major players and millions of dollars, but even seemingly small-scale suburban drug runs, dozens of which operate around Sydney, are turning over high profits with Australians prepared to pay more for illicit substances than most places in the world.

The drug runs are operated like small businesses, with organised crime gangs employing a “run manager” who finds a house where the drugs are to be weighed out and bagged and then oversees the entire operation.

The run manager then employs two or three people to run the drugs to customers. “Runners” often use hire cars to avoid detection and carry not more than 20 drug deals at a time in case they are stopped by police.

There has been a move to the “home delivery” method of dealing some drugs – mostly cocaine, ice, cannabis and, to a lesser extent, heroin. It’s seen as more discreet than having dozens of people turn up at a single address to purchase drugs at all times of the day.

This method is popular with Sydney’s south-western based gangs who also usually use one mobile phone number, spread by word of mouth, as a central contact when customers are looking to buy.

Fairfax Media has been told that many phone numbers used by successful, well-established drug runs in Sydney have been in operation for years. Some operations have been known to reach out to their clients when they receive a new shipment.

How a crime gang makes money from cocaine

The common element

The massive amounts of cash being moved by criminals led to the establishment of a money laundering investigative team made up of the NSW Organised Crime Squad and the NSW Crime Commission in 2014.

Estimates put the amount being laundered in Australia at $4.5 billion almost a decade ago and that amount has grown since. Law enforcement agencies see money laundering as the common element in all serious and organised crime.

Large amounts – hundreds of millions – are transferred offshore through remitting agencies.

There is evidence of one Sydney remitter sending $265 million overseas in eight years. Another transferred $59 million offshore in a four-month period. Some of it is channelled into local real estate. Fairfax Media has been made aware of a number of known businesses, particularly in the building and hospitality industries, that have also been established as a way for criminals to launder money. Some criminal organisations launder their money through casinos.

Money launderer Peter Hoang was lured to his death. Photo: Ken Irwin

The cleaner

To outsiders, Peter Hoang’s was a rag-to-riches story. A self-proclaimed orphan from Vietnam, he escaped the war and survived a childhood in a Thai refugee camp before making it to Australia.

As an adult, he cast the image of wealth and decadence. He sped around the western suburbs in a Lamborghini and picked up his overseas visitors in a rented Nissan GTR. He lived in a high-rise luxury apartment above the bustling city shopping centre World Square and was responsible for bringing in entertainers from Vietnam to perform at shows in Bankstown. He wanted people to believe he was philanthropic. He sought counsel from a Buddhist monk and regularly donated to temples.

But behind the nice clothes, expensive dinners and fast cars, Hoang was laundering tens of millions of dollars for Sydney’s crime figures.

Before he was shot dead near Croydon Park McDonald’s in September 2014, he had washed up to $1 billion through Melbourne’s Crown Casino alone.

His skill for gambling and his high-roller status at Australia’s casinos made him a go-to man for drug traffickers and likely led to his demise.

“One thing we can confidently say is that he owed many people lots of money,” Homicide Squad Detective Sergeant Peter Rudens says. “He was either going to launder it for them or he owed them money for drugs … Or he would gamble it and he would probably win some but he would also lose as well.”

Hoang’s case is a narrow glimpse into the thriving money laundering market that is propping up organised crime in Australia.

Casinos have long been seen as a means to wash illegitimate cash. While casinos say they work with police to identify and ban the prolific gamblers responsible for this practice, it still occurs.

Hoang was blacklisted from Sydney’s Star Casino in the early 2000s but simply moved his work to Melbourne’s Crown.

His streak came undone there in 2012 when he was charged after trying to gamble $1.5 million in cash, which police claimed was the proceeds of crime. Details from his court case revealed he held about $75 million worth of chips at the casino over the prior decade and possibly gambled up to $1 billion.

Through the course of the investigation, police learned Hoang’s orphan claims were false. He came from a farming family in Vietnam but gravitated towards gambling at an early age. He continued that risky passion when he arrived in Australia.

Hoang dealt with many elements of the criminal world – it has been difficult for police to pin down exactly who wanted him dead. Detectives had 14 lines of inquiry, ranging from a failed standover bid on the night of his death to a group of disgruntled and indebted customers rallying together to kill Hoang.

On that night in September, Hoang was having dinner with friends in the city when he received several messages on his Blackberry phone. The heavily encrypted device, which can be wiped remotely, has become a common feature in organised crime murders.

“We suspect he was lured there with a message he had received on his Blackberry because when we recovered his Blackberry it has been completely wiped,” Sergeant Rudens says.

Hoang was shot in the face in a back street of Croydon Park. His attackers roared off down the street. He was an influential player on the high-rolling money laundering scene. But when he died, there is little doubt someone else stepped up to fill the void.