Drugs case four admit laundering $10.5 million

CAPTION:

By JENNIE CURTIN

Three men and a woman have admitted illegally transferring more
than $10 million out of Australia, the proceeds of a
multimilliondollar heroin importing business.

The four pleaded guilty in the Downing Centre District Court
yesterday to importing more than 17 kilograms of heroin in sauna
equipment and to moneylaundering.

The court heard the drug ring was uncovered in November 1995, when
a National Crime Authority (NCA) team searched the Undercliffe home
of Vi Lam, 43, and his wife, Jing Min Tan, 35.

They found 5.88 kilograms of heroin, Australian and foreign
currency worth $694,430, diamonds worth almost $250,000, casino
chips worth $79,500 and gold and jade.

Most of the drugs were found in a room next to a garage that
appeared to have been set up specifically to reprocess the heroin
for distribution, the court heard. Vi allegedly told investigators
the heroin belonged to a Chinese man, Lu Hong, 28.

The NCA officers searched Lu's Lakemba home and found seven sauna
bath water supply systems, each with a concealed area behind a rear
panel. In one unit they found nine packages containing heroin. Lu
allegedly said he obtained the drugs from a man in Hong Kong known
as "Fat Boy". He also said another Chinese man, Yi Li, 31, had
helped him process the heroin.

All four pleaded guilty to laundering $10.5 million between January
and November 1995. Money was transferred under false names to
various accounts in Hong Kong.

The three men also pleaded guilty to possessing heroin and
conspiring to supply it. Lu admitted importing the drugs.

They will be sentenced later.