$17.3m restrained in AFP investigation into Chinese nationals laundering proceeds of crime

A supersized mansion, residential development, farmland and a commercial property are among an estimated $17.3m of assets restrained as part of an Australian Federal Police (AFP) investigation into Chinese nationals allegedly laundering proceeds of crime.

The AFP investigation – titled Operation Gethen – brings the total amount of restrained assets to about $50m since the 2017 signing of a Joint Agency Agreement (JAA) with the Chinese Ministry of Public Security (MPS). The operation sits alongside Operation Balandin as one of the largest restraints made under the JAA*.

Operation Gethen follows a 2017 request from the Chinese Ministry of Public Security (MPS) for AFP assistance to identify two Chinese nationals suspected of laundering proceeds of crime in Australia. Chinese authorities believe the money was raised in China through real estate and bank loan fraud.

The AFP alleges that the two Chinese nationals moved about $23m of fraudulently-obtained funds from China since late 2012, with the proceeds of crime used to purchase or develop numerous properties in Melbourne and Tasmania.

On 29 October 2019, investigators from the AFP’s Criminal Assets Confiscation Taskforce (CACT), working with AFP Criminal Assets Litigation, restrained seven properties in the following locations:

  • A newly-constructed mansion in Mont Albert, Melbourne
  • Three new residential units in Box Hill North, Melbourne
  • A townhouse in Box Hill North, Melbourne
  • Commercial property in Blackburn, Melbourne
  • Over 3000 acres of farmland on Tasmania’s north-east coast

Investigations into the individuals involved are ongoing.

AFP Criminal Assets and Confiscation Taskforce (CACT) Detective Superintendent Kate Ferry said the outcome shows how international collaboration can have a human impact at the local level.

“The AFP has now restrained $50m since formalising our partnership with the Chinese MPS in 2017. This is $50 million that has been taken out of the criminal economy,” Detective Superintendent Ferry said.

“Money laundering – where significant criminal proceeds are moved into Australian assets – is far from a victimless crime. It impacts our whole community by eroding the level playing field for Australian homebuyers and small business owners.”

“This outcome sends a strong message to people thinking about evading foreign governments and police agencies. We are working with our international counterparts to stop proceeds of crime being laundered in Australia – we will catch you eventually.”

The $17.3m in restrained assets are now subject to a Commonwealth restraining order made under the Proceeds of Crime Act 2002. These alleged proceeds of crime were related to the following offences:

  • Dealing in proceeds of crime, money or property worth any value up to $1,000,000 or more contrary to section 400.3 of the Criminal Code 1995 (Cth);
  • Obtaining property or a financial advantage by deception contrary to section 134.2 of the Criminal Code 1995 (Cth); and
  • Causing a loss to the Commonwealth (ATO) contrary to section 135.1 of the Criminal Code 1995 (Cth).

This is the fifth separate investigation since November 2017 involving Chinese nationals allegedly laundering proceeds of crime in Australia.

The AFP has a long and productive relationship with the MPS and ongoing close collaboration under the Joint Agency Arrangement on economic crime cooperation. The AFP will continue to disrupt transnational money laundering groups and demonstrate that Australia is a hostile environment for criminals seeking to hide their illegally-obtained assets.

*Restraint values are estimates due to fluctuations in asset markets and differences between asset valuations and sales prices.

/Public Release. View in full here.