Michael Kustic, Thomas Kelleher, James Martens arrested in major drug bust

ACT and Victoria Police have swooped on what they allege is the ‘largest’ ever identified prescription drug distribution network acting as an ‘online pharmacy’, allegedly seizing steroids, cash and vehicles.

Thomas Eric Kelleher (top left) and James Peter Martens (bottom left) were arrested on December 8 following a joint investigation by ACT Policing and Victoria Police. Picture: ACT Policing/Facebook

Three men have been arrested in what police allege is the “largest” illegal controlled and prescription drug distribution network ever identified in the ACT and Victoria.

Michael Adam Kustic, Thomas Eric Kelleher, and James Peter Martens were arrested on Friday following a major joint investigation by ACT Policing and Victoria Police into the supply of controlled and prescription drugs.

Police allege the three men were sourcing commercial quantities of substances including Xanax, steroids, THC gummies and psilocybin chocolate and operated a “sophisticated” marketing, sale and distribution network for individual buyers, similar to an “online pharmacy”.

The buyers were located across Australia and the group, operating online under the ‘OzPharmLabs’ name, allegedly distributed their products via the postal system.

ACT Policing allege “unprecedented” quantities of controlled drugs were seized in the raids along with $200,000 in cash, a house, several vehicles and motorcycles and designer goods across properties in Gordon and O’Connor as well as in Googong in NSW. Multiple bank accounts were also restrained.

Kelleher, 38, and Martens, 27, were charged with more than 20 charges including traffic in a commercial quantity of a controlled drug, supplying anabolic steroids and traffic in a controlled drug other than cannabis.

James Peter Martens.

Thomas Eric Kelleher. Picture: Facebook

Kustic, 39, was arrested by NSW Police and is expected to be extradited to the ACT to face 40 charges including participating in a criminal group, trafficking in a commercial quantity of a controlled drug and dealing in the proceeds of crime to a value greater than $1,000,000.

Police expect to lay additional charges against all three men once the drug seizures were fully collated and forensic examination of digital items was concluded.

In court on Saturday, defence lawyer Sarah Higgs pushed for Marten’s release on bail on strict bail conditions, effectively placing him on house arrest.

Drugs were allegedly seized across raids in the ACT and NSW. Picture: ACT Policing

Tablets and vials of liquids were also allegedly seized. Picture: ACT Policing

Ms Higgs said the police facts jumped to “conclusions” for Martens involvement where he was allegedly “an errand man” and “not the mastermind”.

In court documents, police intercepted conversations between Kustic and another man, where Kustic allegedly said Martens, who went by the nickname “Thirty”, earned between $10,000 to $20,000 a week.

“Some weeks even more … and living week to week bro,” Kustic allegedly said.

“He goes on TikTok and does all this weird s---. Sends $500 gifts on TikTok and s---.”

The shelving system allegedly found at one of the properties. Picture: ACT Policing

Vehicles were also taken by police. Picture: ACT Policing

Court documents allege Martens was the “runner” for the criminal syndicate while Kustic was “the boss”.

Prosecutor Mark Wadsworth alleged covert methods including encrypted apps and cryptocurrency were used by the men. Police alleged the Gordon man was also found with diaries which contained names of customers.

In Kelleher’s bail application, his lawyer said the O’Connor man did give police passwords to some devices following legal advice, contrary to the police facts.

The court heard the carpenter had significant ties to the ACT and could comply with bail conditions if he was released on bail.

Mr Wadsworth said there was a “salient difference” between Kelleher and Martens, and alleged the O’Connor man could remotely delete data from his devices if he was granted bail.

Detective Inspector Mark Steel speaking to media outside City Police Station about the arrests. Picture: Sam Turner

Police facts allege steroids, psilocybin or magic mushrooms, vehicles, cash, cryptocurrency and a sophisticated shelving system containing storage containers of various drugs were found at Kelleher’s O’Connor home.

In their investigations, police allege Kelleher used his home to store the illicit stock and packaged orders for distribution.

Magistrate James Lawton granted Martens bail but refused Kelleher’s, citing police investigations still underway at his O’Connor home on Saturday.

Both men will have their matters return to court in January next year.

Detective Inspector Mark Steel said this cross-border group were likely to be allegedly responsible for a significant portion of the illegal prescription drug market in Australia, and believed the drugs seized were in the “seven figure range”.

“I can confidently say this is the largest seizure of prescription drugs we’ve ever had in the territory and also down in Victoria as well,” Inspector Steel said.

“These three men were allegedly running a sophisticated, co-ordinated and deliberate illegal business with the sole goal of illicit profit.

“ACT Policing and Victoria Police have co-ordinated their investigation and resolution activity and this should serve as a warning to anyone seeking to profit from illegal activities.”