Record cash seized from dealers

Photo / Thinkstock

Nearly $2.5 million of drug money has been forfeited to the Crown in the largest police confiscation of unexplained wealth from suspected criminals.

Detectives executing a search warrant on the Know-All Group premises - a foreign exchange shop opposite SkyCity casino in central Auckland - found stacks of cash.

The business was run by the late Liang Han Shih, whose phone was bugged by police and who was heard talking to a drug syndicate lieutenant, Yihua Luo, in 2006 about sending money "to the other side".

Shih met regularly with kingpin Tac Kin Voong at SkyCity, where Voong gambled nearly $11 million as a high-roller in just six months.

Voong and Luo were last year sentenced to 18 and 15 years respectively in prison, after being found guilty of methamphetamine charges arising from Operation Ice Age.

Money-laundering charges were also laid against the Know-All Group after police found stacks of cash totalling nearly $2.5 million in the Victoria St premises in December 2006. The money was stashed in drawers, in a safe, in a backpack, under a bed, in a wardrobe and behind a fax machine.

However, the money-laundering charges were dropped after Shih died.

Instead, the Crown applied to the High Court at Auckland to freeze the money under the Criminal Proceeds (Recovery) Act. The law replaced older legislation which required police to prove to the high standard of "beyond reasonable doubt" that assets were criminal proceeds.

They now have to prove only to the much lower civil threshold of "on the balance of probabilities" - essentially placing the onus on the owners to prove where they got the assets.

The $2.5 million found at Know-All Group is the single largest case so far and the cash was forfeited to the Crown in the High Court yesterday. The Herald last year revealed that Operation Ice Age targeted what was the second multimillion-dollar drug syndicate working from SkyCity casino.

In sentencing Voong to 18 years in prison, Justice Patrick Keane compared "Mr Casino" to rival drug kingpin Ri Tong Zhou as the pair had an identical role in their syndicates.

Zhou supplied 3.7kg of P while using SkyCity as the "office" for his multimillion-dollar drug enterprise. He spent $8 million at the casino in six months.

He and Voong were able to "wash" the profits of their drug-dealing by "laundering" the money through the casino and the Know-All Group.

Laundering money can be done several ways through the casino. One way is by exchanging cash for casino chips and cashing them in later for a winner's cheque. Doing this too often can raise suspicions among SkyCity staff.

Alternatively, money can be pumped straight into poker machines, which work on a mathematical calculation that the casino will eventually keep 12 per cent of the takings.

By spending enough time and money launderers can recoup up to 88 per cent of the cash gambled. Voong hired people to play pokies all day.

He and Zhou were seen rubbing shoulders in the casino VIP lounge and would deal with each other when drug supplies were low.

In sending Zhou to 15 years in prison - he received a discount for pleading guilty - Justice Rhys Harrison noted that anti-gambling lobbyists had warned that the casino could become a "scene for large-scale criminal activity or a meeting place for people who commit serious crimes".