DRUG TRADE MEASURED IN BILLIONS

The Australian Transaction and Reports Analysis Centre, which is charged
with tracking down the proceeds of crime, estimates the amount of
drug-related money laundered in Australia at between $1billion and
$4.5billion a year.

Austrac examines transactions where money is sent back to Australia, crucial
intelligence that reveals drug movements overseas.

The police are focusing more heavily on proceeds of crime. "Take away the
house, the boat and everything else and you take away the motive for being
in the game in the first place," Mr Keelty said.

Much of the heroin arriving in Australia ends up in Victoria. In 1998-99 the
state recorded 8153 arrests for using or dealing in heroin out of a national
total of 14,341.

More money has enabled the Australian Federal Police to go after the
syndicates overseas by working closely with other police forces. With
liaison officers in 17 countries, it has developed particularly close links
with police in Hong Kong and the United States and with Canada's Mounties.
It has increasingly close relations with China, Vietnam and Burma.

"That's the key, to spread ourselves across the world get early warning of
trends and syndicates' plans," Mr Keelty said. "If they're a problem for
other countries they're going to be a problem for us.

"The rest of the world is suffering the same as we are. We're not alone in
all this. We're actually agreeing on targets across borders. Forget about
whether they're in Australia, Thailand or wherever.

"Wherever they are, when the time is right we'll take them. We'll pool our
resources to help whoever has to bring them in."

That would not have happened five years ago.

This cooperation has identified organised crime from Hong Kong with strong
links to both Australia and Canada.

And it has identified a loose network of syndicates specialising in
different areas. "In the source country you'll have the syndicate that deals
with the producers and refines the drug," Mr Keelty said. "They'll do a deal
with another syndicate that has the ships, and another may handle the
finance. By targeting the syndicates the AFP hopes to choke the drug trade
off at the narrow end of an inverted funnel.

"That has a much bigger impact lower down the chain."

One big haul of heroin out of Burma recently was brought to Australia on a
ship with an Indonesian crew, and the syndicate that organised it was
Chinese.

The syndicates supplying heroin are largely Asia-based. Most amphetimines
and ecstacy comes from Dutch syndicates that supply Europe, the United
States and Australia.

Most of the cocaine reaching Australia comes from Colombia, but Australia
has no mission in Bogota, so the Federal Police covers Colombia from
Argentina, which is like covering Hong Kong from Sydney.

No one can be sure how much heroin is coming into Australia, but the
authorities suggest it is probably between three tonnes and seven tonnes a
year.Mr Keelty said a local shortage of heroin would not necessarily push
prices up.