CRACKING DOWN ON THE DRUGS BARONS' MONEY

Multi-millionaire Drug trafficker Paddy Farrell was shot dead by his
girlfriend, Lorraine, in their love-nest in Drogheda little over two years ago.

The crime sent shock waves through the criminal underworld along the Border
as Farrell was known in the area as the "Mr Big" of a very lucrative drugs
racket and was estimated to have built up a personal fortune of between
pounds 25m and pounds 40m.

His death meant that a highly profitable business was up for grabs and there
were no shortages of contenders for his title.

Two of the would-be contenders, Brendan "Speedy" Fegan and Paul "Bull"
Downey have also since died victims of the Provisional IRA who were not
satisfied with their distributions of the profits.

RACKETEERING

But the criminals were not the only group to take a keen interest in
Farrell's financial affairs. Farrell had already been at the centre of a
massive investigation, codenamed Operation Madonna, involving the Garda, the
RUC, and police forces in London, Surrey, Merseyside and Lancashire into
racketeering and suspected fund raising links between the paramilitaries and
drug running gangs over the previous three years.

After his death a fresh investigation was initiated and local gardai from
the Louth-Meath division called in the Criminal Assets Bureau to take a
fresh look at Farrell's assets.

The inquiries were spearheaded by the CAB director, Chief Supt Fachtna
Murphy and his then deputy, Supt Felix McKenna who has since become head of
the Garda Fraud Bureau.

The investigation resulted in close co-operation with several police forces
and customs in Britain, the United States and the RUC until finally the
trail led them to a bureau de change which they suspected had been used by
Farrell and his gang to launder their profits from drug trafficking.

A joint inquiry, codenamed Operation Factual, was set up by the CAB and the
Fraud Bureau and it quickly became clear that Farrell was not the only drug
trafficker to use the bureau de change which is situated close to the Border.

On the Northern side the RUC set up Operation Beaumont as the complex task
of unravelling the bank accounts used by the exchange here and another one
in the North was tackled by detectives, backed up by expert advice from
lawyers and accountants.

Money believed to have been laundered by another big time drug trafficker
from Mayo, who was handed a jail sentence earlier this year after being
arrested by the Garda national drugs unit, was also traced back to the
Border exchange.

Huge profits from illegal trafficking in cigarettes internationally were
also reckoned to have been laundered through the two exchanges but, it must
be pointed out, legitimate money also passed through its accounts.

Initial estimates after yesterday's series of raids show that up to pounds
70m passed through the Border exchange over the past three years and into a
vast network of bank accounts internationally. Senior officers on both sides
of the Border decided it was time to move against those involved in the
suspected money laundering, drug trafficking, and unlicensed banking and on
Monday night a team of 70 detectives were fully briefed at a meeting in
Dublin in preparation for the early morning arrests.

They were drawn from the CAB, Fraud and Drugs units and were backed by 30
local gardai while the RUC brought in back-up from the British Army and used
military helicopters as their 150-strong team moved into Newry and south Armagh.

A further briefing meeting was held in Navan last night as detectives totted
up the cash that had been seized. It was reckoned that about pounds 1m in
cash, cheques and drafts were taken from the premises searched including the
two exchanges and one house where money had been stashed.

Staff at the two exchanges were interviewed while four men and three men
were arrested in the Republic and one man detained in Crossmaglen.

But the Gardai were also determined to widen the paper trail and visited the
offices of three accountancy firms in Dundalk, one solicitor's firm in the
county Louth town and two solicitors' firms in Dublin.

Files relating to some of the suspects and computers were taken for further
examination in some of the searches while two boats moored in a marina at
Carlingford, Co Louth, were also checked out.

Early examination of the files has not unearthed any paramilitary links to
the money laundering but experienced detectives said they were not ruling
out the appearance of terrorists at some stage of the investigation. A lot
of interesting names are likely to emerge as the inquiry progresses.