Police posed as steroid buyers, bugged phone calls to snag bodybuilding duo
Undercover police posed as gym junkies, tapped the phones of two bodybuilding giants and staked out their homes before arresting them over a huge alleged steroid syndicate supplying hundreds of customers.
Police & Courts
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Undercover police posing as gym junkies played a key role in dismantling an alleged home delivery steroid syndicate which operated with impunity and supplied hundreds of customers, mostly of whom were body builders.
Documents obtained by the Sunday Herald Sun reveal how state and federal police unmasked the men behind the syndicate, which sold steroids under the name “OzPharmLabs” and “Next Knows Pharma”.
The syndicate had been using encrypted online messaging platform Threema — which cannot be tracked or intercepted by law enforcement — to sell millions in drugs.
But an extensive survellance operation and a simple undercover sting identified the syndicate’s bosses and several of their minions.
More than a week on from the raids, it can also be revealed that the volume of drugs seized in raids in the Docklands, country NSW and suburban Canberra was so large that police are still counting the haul.
Victoria Police said the current street value estimate of the drugs seized in Melbourne was between $7m and $10m.
The haul was so big, officers needed to make multiple trips to the Docklands apartment tower as the goods wouldn’t fit in the one vehicle.
Among the drugs seized were testosterone, diazepam and alprazolam.
Five men have been charged, including champion Melbourne bodybuilders and popular personal trainers Daniel Tenace, 32, and Nathan Williamson, also 32.
Police in Victoria first caught wind of the syndicate after intercepting a parcel allegedly containing steroids from an Essendon home in April 2023.
Among the items taken by police was a mobile phone that had messages on Threema with an account called “FlameKing” – alleged to be Williamson – with details about the parcel.
Security camera footage shows showed Williamson allegedly shipping the parcel.
It was through the postal service that the syndicate delivered and retrieved most of its products.
The Melbourne Magistrates Court heard that Williamson allegedly used a Docklands apartment rented in his mum’s name as a warehouse for the drugs.
In August, police were notified by DHL in Port Melbourne that packages had been delivered to the syndicate at the post office.
Police with a search warrant seized the packages and allegedly found 550 vials of steroids believed to be valued at more than $55,000 among other items.
Police also allege the Victorian end of the syndicate sent packages to the homes of unsuspecting members of the public, and retrieved them after they were delivered.
One person that received a package that was eventually picked up by Mr Tenace, told police the bodybuilder said the package contained medicinal products.
Another resident – who had received one of the packages – allegedly found 180 boxes of liquid inside before handing it to the police.
They were then too scared to open the door when Mr Tenace arrived, believing he was linked to the mysterious package.
It’s understood post office workers at Kalkallo in Melbourne’s north, where many parcels were allegedly picked up by Mr Tenace, grew frustrated by the alleged suspicious activity and received multiple complaints.
Two of the major figures in the Canberra end of the syndicate were Michael “The Boss” Justic, and James “Thirty” Martens.
It is alleged Kustic went from being an unemployed panel beater to an a multimillionaire, and that he paid Martens $10,000 a week to collect “bulk quantities of illicit stock from post offices or interstate locations.
The precise link between the Canberra and Melbourne ends of the syndicate remains under investigation.
Of all those arrested, Kustic and a man whose suburban Canberra home was used as a storage facility for drugs, Thomas Kelleher, remain behind bars on remand, after a Canberra Magistrate on Friday described the syndicate a “highly sophisticated criminal network” operating a “commercial enterprise”.
Both Mr Williamson and Mr Tenace were bailed under strict conditions after appearing in the Melbourne Magistrates’ Court.
How police went undercover to plot their arrests
Undercover officers spent hours tracking the movements of the alleged players in Canberra, sitting outside their homes, following them to ATMs and witnessing late night meet-ups with associates.
Officers posed as steroid buyers online and purchased significant quantities of the bodybuilding gear, listened to hours of tapped phone calls, and tracked hundreds of suspicious online banking transactions.
This was the groundwork that enabled police to really hone in.
The alleged criminals in Canberra used similar methods of operation to those operating in Melbourne.
The ACT branch’s stock was allegedly stored at Thomas Kelleher’s address, who was also in charge of packaging orders.
Martens and Kelleher were charged and appeared at court in Canberra last week.
Kustic was extradited to the ACT where he faced court on Friday.
An unidentified “ruthless” American personal assistant was also believed to be on Kustic’s payroll.
In a phone conversation intercepted by police, Kustic bragged that “$70,000 watches don’t buy themselves” and that he “profited nearly 2m this year — you don’t do that without drugs”.
The handle was even banned from advertising on an online bodybuilding forum.
It’s alleged more than $3m was deposited across five different bank accounts — all under different names — from sales, with large cash withdrawals regularly made by Kustic from ATMs.
Most customers used “fencing” or “invoice” as the reference online.
Those involved in the alleged trafficking and transportation of the steroids also sent them in parcels through Australia Post – until office workers became suspicious and alerted federal police.
Those office workers told investigators the alleged dealers would commonly use different names when sending the packages, which was the straw that broke the camel’s back.
From September, police in Canberra used undercover aliases to purchase six lots of steroids, analysing the cryptic messages and movements distributors made to bring it down.
Those undercover agents were given a stock list of the goods and gear on offer, which largely included a range of steroids, Viagra, vapes, cannabis oil, and psilocybin.
Psilocybin is a type of mushroom and when broken down, can cause hallucinations – much like the commonly known magic mushroom.
This drug was later found inside 30 chocolate bars distributed in the mail by the syndicate last month, destined for a nearby sweet tooth.
ACT police say a final figure for the product seized in the territory was yet to be established but “investigators are confident there are in excess of 60,000 drug items to analyse”, with an expected dollar value in the “seven figure range”.
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