Australian motorcycle clubs expanding into south-east Asia to get slice of drug market

The UN estimates that the interconnected illicit methamphetamine market in south-east Asia, east Asia, Australia, New Zealand and Bangladesh is worth up to US$61.4bn a year. Photograph: Tracey Nearmy/AAP

UN report says Outlaw Motorcycle Clubs expanding presence because of increased law enforcement attention in Australia

Australian Outlaw Motorcycle Clubs have expanded into south-east Asia to take advantage of a booming, multibillion-dollar methamphetamine export market in the region, a landmark report from the United Nations has warned.

Where once China and Hong Kong were the dominant suppliers for illicit methamphetamines into Australia, a new report by the UN office of drugs and crime released on Thursday detailed the new “global reach” of drug exports originating in south-east Asia.

The most detailed look yet into the drug market in the region, the report explains how criminal networks in the region use lightly regulated free-trade zones, lax border control, money laundering through casinos and corruption to traffic “unfathomable quantities” of “high-profit methamphetamine” into neighbouring countries including Australia.

Based on information gathered from intelligence agencies, the UN estimates that the interconnected illicit methamphetamine market in south-east Asia, east Asia, Australia, New Zealand and Bangladesh is now worth between US$30.3bn and US$61.4bn annually.

The market in Australia and New Zealand represents about US$11.1bn of that, partly because of the “disproportionately” high wholesale and retail prices for the drug in those countries.

And, according to the UN, criminal networks in Australia have moved in to get a slice of the booming market.

While major criminal syndicates from Macau, China, Hong Kong and Thailand have become “dominant players” in the production and trafficking of methamphetamine and other synthetic drugs from south-east Asia, more recently outlaw motorcycle clubs from Australia and New Zealand have “sought to gain a foothold in the region”.

Citing evidence from intelligence agencies, the report details how Outlaw Motorcycle Clubs have expanded their presence into the region, partly because of the increased law enforcement attention on them in Australia.

The report says motorcycle clubs are now involved in drug trafficking, extortion and money laundering in the region, using the example of the arrest in Australia of three men associated with an Outlaw Motorcycle Clubs with 119kg of crystal methamphetamine trafficked from Malaysia and seized in Melbourne in April 2017.


“It is expected that OMCs may expand their involvement in the methamphetamine trade from south-east Asia to Australia, considering the low price per kilogram, and increased quantities of methamphetamine manufactured and available in the region,” the report states.

While demand for methamphetamine is rising, the global demand for heroin appears to be falling.

But Australia remains a target market for criminal networks in south-east Asia. For example, authorities in Malaysia report that “increasing quantities” of the drug are being trafficked through its ports, “in particular to Australia”.

“Forensic analysis and profiling of heroin seized at the border of Australia and investigated by the Australian federal police indicate that the heroin market in the country has been predominantly supplied by heroin originating from south-east Asia, accounting for nearly all of the heroin detected in the country in the past couple of years,” the report states.

“Heroin trafficked from Myanmar to Australia usually transits through one or more countries before arriving in Australia, and large quantities of the drug have been trafficked through countries in Southeast Asia.”

“For instance, Malaysia was reported as the top embarkation and transit point, accounting for 53% of all heroin seized in the country in 2017. Lao PDR, Thailand, Cambodia and Vietnam have also been reported as major embarkation points for heroin seized in Australia in recent years.”

The UN report focuses not just on the production and trafficking of illicit drugs in the region but also wildlife and timber trafficking, human trafficking and migrant smuggling, as well as counterfeit goods and fraudulent medicines.

While some illicit trade crosses borders clandestinely along jungle tracks or unofficial seaports, most illegal commodities are transported along the same infrastructure as legitimate trade.

A “dramatic expansion of some of these illicit flows in recent years” has been assisted by free-trade agreements aimed at boosting trade and economic growth in the region, the report states, while commercial banks, securities companies, real estate agencies and casinos are used for money laundering.

One method of concealment used by transnational crime and trafficking groups operating in the Shan State – the main production hub for crystal methamphetamine in Myanmar – is through tea packages.

“Based on extensive case information reported by countries in the region, seizures of crystalline methamphetamine concealed in a particular tea packaging have been found throughout the Mekong and in most other parts of south-east Asia, as well as in Australia,” the report states.

“The majority of major crystalline methamphetamine seizures in recent years have involved this method, with the number of seizures involving tea packages increasing in line with the growth of crystalline methamphetamine production in Myanmar.”

Casinos, in particular, are used as money laundering ventures. As of January 2019, there were 230 licensed casinos in south-east Asia. Of those, 150 were in Cambodia – compared with only 57 in 2014.

Many of the casinos emerged after a crackdown on money laundering activities in Macau in 2014, the report notes, raising concerns that a “displacement” of criminal activities associated with casinos has taken place.

“Cambodia in particular has witnessed a dramatic increase in the number of casinos and casino licenses granted since 2014,” the report states. “In addition, there are increasing reports of casinos in Lao PDR, Myanmar, and the Philippines with proven links or alleged links to organised crime and money laundering.

“In the Mekong region, many casinos are located in areas characterised by poor governance and political instability, or in border regions with significant crime or armed insurgency problems, and they operate illegally or quasi-legally.”

The report comes as Pacific nations struggle with an influx of drug trafficking from the US and Latin America towards Australia. In June, hundreds of kilograms of cocaine have washed up on remote Pacific beaches as part of an explosion of drug trafficking through the region.

Source: The Guardian