Wednesday, August 31, 2011

Agency lost $300,000 in sting, but no questions asked

Geesche Jacobsen August 29, 2011
A CRIME COMMISSION money-laundering sting involving the convicted former assistant director Mark Standen and his informant-friend James Kinch - leading to the loss of $300,000 - has never been investigated, raising questions about the controls in the commission and other agencies.

The missing funds are believed to have reached Mr Kinch's alleged Dutch drug syndicate contacts, without yielding any new evidence of substantial leads

Standen was convicted two weeks ago of conspiring with Mr Kinch, an alleged English drug dealer, to import a drug precursor into Australia in 2008. Yet the two first met in 2003, when Mr Kinch had been charged over unrelated drug and money laundering offences. He turned informant and was keen to tell authorities about two Indian brothers running a money exchange operation in Sussex Street.

On October 31, 2003, NSW police watched Mr Kinch take about $300,000 in bundles of $50 and $20 notes in a black sports bag to the brothers' business. It is believed the money was transferred in lots of less than $10,000 into various accounts before being sent to Paris, then Britain and then the Netherlands.

The so-called controlled operation - a sting involving sanctioned criminal behaviour by Mr Kinch and one law enforcement officer - was approved by the Commissioner, Phillip Bradley, and led by Standen. The failure to investigate why this operation was unsuccessful stands in stark contrast to an investigation of two police officers by the royal commission regarding an incident in 1992 when a similar amount of money went missing in a failed drug operation.

Sources have raised doubts about the legality of the $300,000 operation involving Mr Kinch, suggesting the Commonwealth DPP initially ruled that his participation was illegal, and that a letter changing the legal advice was only received after the operation had been conducted.

A spokeswoman for the Commonwealth DPP did not reply to specific questions, saying only: ''The conduct of controlled operations is a matter for the investigative agencies involved.''

Standen's trial was told Mr Kinch was assured his involvement had been authorised. The commission's records for the operation were also reviewed by the NSW Ombudsman and found to be in order. But the director of the Crime Commission, John Giorgiutti, did not know about the operation until earlier this year.

The Indian brothers were charged with conspiracy to launder $2 million in 2004 after a separate investigation. No money was recovered in this operation.

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