DRUG WAR: THE ENEMY JUST GETS SMARTER

International criminal gangs are mounting counter-intelligence operations
against police as their attempts to smuggle massive drug shipments into
Australia become increasingly sophisticated.

Drug entrepreneurs have responded to increased Australian police activity
by using their vast wealth to buy equipment to encode their telephone
conversations, to keep police stations under surveillance when shipments
are due, and to study police techniques so that they can change their own
tactics.

A source who declined to be identified told The Sunday Age that former
law-enforcement specialists were also being employed by legal teams
defending gang members charged with drug offences.

"They can analyse briefs of evidence to determine how plans came unstuck
and how the players were caught, the tactics used to catch them," the
officer said.

That told the defence team how the investigation was carried out, through
undercover agents, informers, electronic surveillance or overseas intelligence.

"But it also goes back to the entrepreneur as in-service training so they
don't do it that way again. Basically they are providing intelligence
assessments to the crooks."

That made it difficult for police to stay ahead, and could also endanger
informants.

"We think we're getting the jump by way of a new bit of technology or this
new bit of legislation, but they're always ahead," the source said.

The source said counter-intelligence had become a huge industry in the
criminal world.

"It employs great legal skills. Around the world former police and
intelligence officers have the capacity to defeat your electronics -
listening devices, phone taps and tracking systems and everything else we use."

Criminal gangs could, with relative ease, obtain the sort of equipment
police were using to monitor their activities. "We first saw that happening
in America and now we're seeing it here."

Gangs were were using encryption devices to prevent police listening to
their plans on intercepted phone calls: "You can buy the capacity to
scramble phone calls over the counter," the source said.

The international drug trade had become far more sophisticated as the
hierarchal structures that controlled production and distribution in the
past had given way to operations that were more fluid and entrepreneurial.

Suppliers were trying to outdo each other and were offering packaged deals.

"We are now finding there arepoly-drug syndicates operating like a
supermarket - `what do you want? Look at the range we have here'."

Gangs operating out of Asia and Europe are also using contacts in Australia
to gather detailed information about police operations through press
conferences and drug-squad interviews.

Federal agent Mick Keelty, the officer responsible for Australian Federal
Police international anti-drug operations, said telephone intercepts caught
syndicate organisers in Europe and Asia asking for information after major
drug busts.

"When we have seizures here the organisers overseas are demanding to find
out what our methodologies are. They get on the phone and have material
faxed over to them.

"We're monitoring them calling for the press releases and wanting details
of how we did it. Anything we say in the press. That is why we are very
keen not to disclose methodology, because as quick as we do they alter
their methods of importation.

"It's counter-intelligence."

Mr Keelty said he was not surprised the drugs gangs were becoming more
sophisticated. "They are in a multi-million-dollar business, so why
wouldn't they be?"

The syndicates were operating like any other business and the amounts at
stake were huge.

The extent to which the drug gangs had harnessed the benefits of
globalisation and the intricacy of the high-tech police work needed to
combat them were illustrated dramatically in an operation that saw nearly
$7million in cash confiscated from a syndicate operating between Australia
and the Netherlands.

Australian officers had the syndicate under investigation for more than two
years when they intercepted a telephone call revealing that a significant
amount of money was to be hidden aboard a Panama-registered ship, the
Neptune Wind, that was about to sail from Yamba in northern NSW for the
Philippines.

"We heard them talking about it being secreted in packs of meat," Mr Keelty
said.

That piece of the intelligence jigsaw fitted snugly with a surveillance
report that syndicate members had visited an abattoir.

"We decided it was time to take them out." One team descended on the ship.
"We went into the fridge, unpacked the meat and found $5.1million in cash."

The money came in every denomination. It was tightly compressed and vacuum
sealed, but still filled a packing case.

"We didn't know how much we had. Most people have no notion what $5million
cash looks like."

The officers took their haul to the Reserve Bank, but the tightly packed
money would not go through the counting machine and it took three days to
count it by hand.

Another team searched the Bunyip Inn, a hotel the syndicate was running on
the NSW South Coast. They demolished a wall and found more than $900,000 in
Australian cash. No drugs were found, but the operation had uncovered
enough evidence for the police to prove that the cash was going to be used
to purchase the next consignment the syndicate brought in.

"We hit them with a conspiracy charge," Mr Keelty said.

The syndicate had been working throughout Asia and Europe and extensively
across Australia and was run by 67-year-old Lawrence "Joe" McLean, one of
Australia's most successful criminals.

Long suspected of being heavily involved in the drug scene, McLean had
avoided serious trouble with the law for nearly 30 years and was widely
considered untouchable.

Looking like any harmless old pensioner, he'd wander around Australia using
concession tickets to travel by bus. But in his bumbag he'd have $100,000.

When a big drug shipment was coming in, his syndicate would keep police
stations under surveillance to find out whether the police were on to them.

Those responsible for "laundering" the money planned to bank it and have it
transferred electronically to the suppliers in Europe as American dollars.
The bank would then send the cash back to Australia.

McLean was convicted of conspiracy to import tonnes of cannabis resin and
jailed for 16 years.

The Bunyip Inn was confiscated as part of the proceeds of crime and
auctioned recently for $960,000, which goes into government consolidated
revenue.