China crime groups using foreign students to launder drug money in Australia
Chinese university students in Australia are being used by Triad-linked crime groups to launder millions of dollars from drug trafficking operations. This is how it works.
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Exclusive investigation: Foreign students are being coerced by organised crime groups to launder drug money in an enterprise that has boomed during COVID-19 and the pandemic’s related economic hardship.
A police intelligence memo has cited the use of mostly foreign university students from China either threatened or enticed with cash to help legitimise illicit cartel money the Australian Crime Commission estimates is into the hundreds of millions of dollars.
Such is the size of the enterprise, whole “Cuckoo Smurfing syndicates” have evolved to launder vast sums of cash from criminal sales of drugs including ice and cocaine being moved here by Triad-related networks.
Several networks have been exposed in Sydney and Melbourne but operate in all cities.
Much of the money being laundered comes from huge cannabis operations in NSW and Queensland as well as from sales of shipments of cocaine and ice coming through our ports.
The practice involves a “smurf” or student who makes multiple deposits of dirty money in under $10,000 lots, and are either paid for the service or threatened by the mostly Chinese-run organised crime groups.
The cuckoo term comes from a bird that uses other nests (bank accounts) for its eggs (cash) and Smurf after the carton character which would use the word “smurf” as a replacement verb for their action including concealing naughty deeds.
The practice has been around for years but has blossomed during COVID-19 with desperate university students looking for easy ways to work and being told the practice was either not illegal or made to do it from threats of harm or deportation.
Some students were also using casinos to clean dirty money through on behalf of criminals.
NSW Organised Crime Squad commander Detective Superintendent Martin Fileman said it was a serious issue, being seen nationally.
“These Criminal groups will give the money to say Chinese remitters who in turn will give to 50 students who will then legitimise that money by putting it into their bank accounts in under $10,000 (lots) so it doesn’t get reported to Austrac,” he said.
“So they will utilise these people, foreign students to actually get $9999 dollars each and go and put this money into specific accounts they are told to put in. And under cuckoo smurfing they put it into accounts that sometimes people don’t even know, using legitimate accounts then once they are in there they can withdraw it.”
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It follows revelations last month Chinese students were becoming victims of “virtual” kidnappings in a scheme that has netted crime syndicates more than $3 million.
That sophisticated extortion involves young victims conned into faking their own kidnapping to demand ransom payments from relatives.
It also comes amid reports Chinese crime groups had been hiring ex-Red Army soldiers in organised standover of businesses in the capital city Chinatowns.