Over $1million in cash has been seized after a gang was busted for allegedly selling baby formula as a front to move drug money.
Three men were arrested across suburban Sydney on Monday in connection with the alleged international money-laundering syndicate.
Police seized the cash packed into supermarket cooler bags outside a western Sydney daigou, a business which re-sells Australian goods to China.
Three Sydney men were arrested in relation to an alleged international money-laundering syndicate on Monday. Police seized $1million cash in cooler bags (pictured above)
Wang Wuchen, 37, and Ma Jiyuan, 40, were both arrested (one arrest pictured) and faced Parramatta Local Court on Tuesday where they were denied bail
Wang Wuchen, 37, from Carlingford, was arrested outside the daigou in Auburn while allegedly delivering the money as the group’s ‘cash-collector’.
Ma Jiyuan, 40, from Dundas Valley, was arrested after leaving a pub in Ermington and was alleged to be the coordinator of the money laundering operation.
The pair appeared in Parramatta Local Court on Tuesday and were accused of laundering $28.4million for offshore Australian crime figures, The Daily Telegraph reported.
Wang was charged with recklessly risking money as an instrument of crime.
The court heard that $1.2million was found during a raid on his home.
Ma was charged with intending money as an instrument of crime and failing to comply with an order.
Police arrested Wang outside of a daigou business (pictured) in Auburn, western Sydney, where sought-after goods like baby formula are purchased in Australia and re-sold in China
The court heard Wang and Ma allegedly funnelled millions of dollars of illicit drug money on behalf of offshore crime figures through the daigou business (pictured above)
Wang and Ma were allegedly identified as part of a joint investigation between the Australian Criminal Intelligence Commission and the United States Drug Enforcement Administration.
Police will allege the two Sydney men funnelled millions of dollars through the daigou business, from the sale of drugs, on behalf of their criminal clients.
WHAT IS A DAIGOU?
Daigou, a Chinese word, translates to ‘surrogate shopping’
A daigou business operates by sending shoppers into Australian stores to purchase items that are sought after in China
The shoppers bulk buy high-value items like baby formula, vitamins, luxury clothing and accessories
These goods are then exported to China for re-sale
The daigou business is legal and often deals with large amounts of cash
Source: NSW Police
Thomas Keogh, 21, was also arrested in southwest Sydney on Monday and was passing the bags of cash onto Wang to be laundered.
Keogh was charged with recklessly dealing with the proceeds of crime and dealing with property proceeds of crime.
He remains in custody after he was refused bail in Fairfield Local Court on Tuesday.
A joint investigation between the Australian Federal Police, Australian Criminal Intelligence Commission and NSW Police will continue into the alleged moving of illicit drug profits through daigous.
Police claim money laundering operations often funnel dirty money through the cash-intensive daigous to avoid Australian authorities.
Investigations are ongoing into whether the daigou operators were aware their business was being used to move illegitimate funds.
Wang and Ma were both refused bail and court documents revealed Ma did not admit to any offence during his police interview.
Magistrate Tim Keady said Wang played a ‘small but important part’ in the money laundering syndicate.
‘There are very large amounts of money involved and multiple alleged participants.
‘He has offered no explanation as to how he allegedly came to be in possession of the $1.2 million,’ Mr Keady said.
Wang and Ma are set to face Parramatta Local Court in October.
One of the cooler bags containing $500,000 in cash seized by police (pictured above)
Investigations are ongoing into whether the daigou (pictured above) operators were aware their business was being used to move illegitimate funds