Number 5 Sqn RNZAF flies around the South Pacific in support of NZ Customs monitoring pleasure craft leaving NZ waters. / Dean Purcell
Traditionally illicit drugs in New Zealand can trace its origins to Asia, but now a growing and highly-profitable trade has caught the eye of Kiwi authorities.
Organised South American criminal groups are sending large amounts of cocaine to New Zealand - and we are paying top dollar. It has resulted in some enormous busts in the past 18 months involving tonnes of drugs and millions of dollars.
Now, with an increased Government budget, Customs is going after the Mexican cartels. Sam Hurley investigates.
He was known to the group simply as David.
The group consisted of Americans and Mexicans and they had code names - the Godfather, Silverio and the Artist.
They were suspected to be associated with Mexican cartels.
The mission was elaborate and well planned. Its goal was to import thelargest consignment of cocaine ever into New Zealand - $14 million-worth in one shipment - 35kg. All inside a massive diamante-encrusted horse head.
It's the type of case Customs will be attacking with an extra $54.2m of operating funding over four years granted in the May Budget.
They are going upstream, targeting and disrupting criminal networks at the source.
Mexican cartels are at the top of the hit list.
The funding will see an additional 127 Customs staff, domestically and overseas, as the agency seeks to keep the harm offshore.
The change in tactics comes after success using the proceeds of crime fund to invest in Customs intelligence officers abroad - the first in Hong Kong.
Results quickly followed and Asian drug smuggling operations were being dismantled before the narcotics reached our shores.
New Zealand authorities, including the air force, are increasing its surveillance of drug traffickers using ships, yachts and smaller pleasure craft in the South Pacific. Photo / Dean Purcell
In 2016, drugs that would have cost the New Zealand economy $16m in social harm were stopped at overseas ports.
And in the first five months of this year the figure is already $72m.
This, Customs hopes, will see a drop in the estimated $1.8 billion annual social-harm cost to New Zealand from drugs.
It's not necessarily about more capacity but more an investment in capability, says Jamie Bamford, Customs group manager of intelligence investigations and enforcement.
The focus on disrupting the smuggling networks offshore has already begun and includes two intelligence officers in Washington DC, one in Bangkok, Jakarta, Beijing, Brussels and two in Canberra.
Although methamphetamine is still Kiwis' drug of choice, an increase in cocaine importations has seen an increase in working with overseas counterparts to identify Mexican and South American organised criminal networks running operations to and in New Zealand.
Customs' Jamie Bamford and Police Assistant Commissioner of Investigations Richard Chambers. Photo / Andrew Warner
"I'm ashamed to say there are enough drugs reaching New Zealand and as much as we can have stopped overseas the more room we can have to manage the quantities that do get through over here," says Bamford.
"By putting some people in particular places and by increasing our footprint offshore, by increasing our engagement with our partners offshore we have started to see the drugs seized away from New Zealand."
New Zealanders pay among the highest prices in the world for cocaine. With a renewed peace of sorts in Colombia, the coca leaf is bountiful.
More coca is being grown and more cocaine is being manufactured in South America.
However, with a slightly changing drug palate in the US, which is the traditional market for South American cartels, New Zealand and Australia are the new targets.
Last year, the Americas led the harm value of drugs destined for New Zealand and seized offshore.
It was more than double that of Asia, $34m compared to $15m. Some $6m was also stopped in Europe and $1.8m in the Pacific.
The Maersk Antares arrived in Tauranga from Chile last year with 46kg of cocaine hidden on board. Photo / Andrew Warner
"There is a glut of cocaine out there, where can we send it? The Kiwis are willing to pay top dollar, let's go," is how the cartels think, says Bamford.
"I think they think we're so far away that actually the organisers behind this kind of go scot-free."
Detective Superintendent Greg Williams told the Herald on Sunday the police's National Organised Crime Group, in conjunction with partner agencies including Customs, has identified and dismantled 17 transnational organised crime groups since February last year.
"In working with our international partners, we're aware of organised crime groups right across the world. There are strong links between manufactures, importers, wholesalers and retailers," says Williams.
Williams, the national manager for the Organised Crime Group, says overseas-based liaison officers play a crucial role in operations but could not comment on the methods used to protect the integrity of their assignments.
"Our intent is to continue to prevent organised crime flourishing. These illicit drugs are destructive and have no place in our communities."
South American crime gangs and Mexican cartels are believed to be behind the increase in drugs coming out of the Americas.
Bamford says the cartels are identifying New Zealand as somewhere with an increasingly good trade and air connections.
He says more and more drugs are coming out of the Americas, but the majority of methamphetamine still is sourced in South-East Asia's golden triangle.
However, air passengers from the Americas and an increase in sea ventures have seen an increase in cocaine supply in New Zealand.
"It's all highly organised," Bamford says.
"We think Mexican criminal gangs and cartels sit behind this … we've seen an uptick in [drug] couriers coming out of South America."
The black bags seized from the Elakha contained 1.4 tonnes of cocaine. Photo / Australian Federal Police
The New Zealand Defence Force, through the Air Force and Navy, also provides assistance and using maritime surveillance helps identify what threats might be coming our way.
Significant drug trafficking using ships, yachts and smaller pleasure craft, whether coming to New Zealand or away from our shores, have also increased, Bamford says.
In February last year, New Zealand and Australian law enforcement agencies stopped the Tauranga-based sloop the Elakha, after it allegedly met a drugs "mother ship" in the southern Pacific Ocean.
There, a group of men helped transfer dozens of black bags on to the yacht.
The bags contained 1.4 tonnes of cocaine – worth $327m.
Bamford says his service had been investigating the Elakha and its crew for three years, sharing information with the Australian Federal Police and border officials.
Six men were arrested, including four Australians, one Swiss-Fijian and a Kiwi.
The 15m-long Elakha. Photo / Australian Federal Police
Also last year, in October, the container ship Maersk Antares arrived from Chile.
A group of people approached the vessel under the cover of darkness and retrieved 46kg of cocaine from a hidden compartment on the exterior of the hull.
The drugs were worth $20m - New Zealand's largest-ever single seizure cocaine bust.
It had arrived by plane from Mexico via Hong Kong before an American and Mexican arrived from Hawaii as part of the "sophisticated, large-scale commercial drug operation".
US man Ronald Wayne Cook Senior and Mexican national Agustin Suarez-Juarez were arrested last year and later jailed for 17 years and nine months and 19 years and nine months.
Henry Anchondo leaving Auckland's Crowne Plaza Hotel after meeting Ronald Cook Senior and Agustin Suarez-Juarez. Photo / Supplied
They met Anchondo at Auckland's Crowne Plaza Hotel. He evaded the law for more than a year.
But, on September 19 last year Anchondo was arrested in Whangārei and this week pleaded guilty to possessing cocaine for supply in the High Court at Auckland.
Cook and Suarez-Juarez said during their trial they thought the diamante sculpture was full of cash, not drugs, and believed they were involved in money laundering.
As part of the Customs and police sting, code-named Operation Azteca, it was revealed three suspected masterminds were behind the operation, referred to by Cook and Suarez-Juarez as the "Godfather, Silverio and the Artist".
Some 35kg of cocaine was hidden inside this diamante-encrusted horse head from Mexico. Photo / Jason Oxenham
The Godfather appeared to be the most senior member, Silverio was the largest investor, and the Artist concealed the drugs in the horse head.
All three are yet to be identified, but are suspected to be associated to Mexican cartels.
A third man, Gonzalo Rivera Pavon, was exonerated from the importing scheme after social media messages cleared him of any guilt.
On a recent Air Force Orion mission in conjunction with Customs, the Herald on Sunday watched as the crew identified pleasure craft leaving New Zealand and other potentially suspicious yachts in the area.
Most of the small vessels were simply being sailed to warmer waters for the winter months. However, one caught the attention of the Orion crew.
It was a yacht registered in New Caledonia sailing towards New Zealand waters.
After a low fly-by and communication with the captain of the yacht it was determined the skipper was just off-course as he made his way to French Polynesia.
Several yachts were buzzed by the Orion during the mission - all were photographed and the images and data collected by the crew sent immediately to Customs intelligence officers back in New Zealand to analyse.
The New Zealand Defence Force, through the air force and navy, is providing Customs with maritime surveillance. Photo / Dean Purcell
The mission covered a swathe of ocean north of New Zealand, an area Bamford said was seeing an increase in non-traditional methods of drug importing.
In the past, mail, fast freight, air freight and passengers were the preferred method. Now the emerging trend is for large quantities of drugs to be brought into New Zealand by ship.
Drug smuggling and trafficking, Bamford explained, is a business and "it's all about the money".
He says Customs was reinforcing its financial intelligence capabilities, which works alongside police and the Department of Internal Affairs.
This sees efforts to counter cash smuggling and stop trade-based money laundering, which sees the profits from the drug trafficking in New Zealand go overseas.
"If we can hit the money, we can try and take some of the incentive out of the drug trafficking."
Flight Lieutenant John Brereton during a recent air force mission over the South Pacific. Photo / Dean Purcell
From today , banks and financial organisations will be required to report suspicious transactions under new laws in the Anti-Money Laundering and Countering Financing of Terrorism (AML/CFT) Act.
That could include activity such as the change of ownership for a shell company shifting assets, without the need for a transaction.
New Zealand banks and financial institutions had been given a grace period to comply with the new laws on money laundering and financing of terrorism due to IT "complexities".
Police will be given details of all cash transactions of $10,000 or more, and all international wire transfers and inward international wire transfers from New Zealand of $1000 or more.
What New Zealand law enforcement authorities fear, however, is the mixing of organised criminals in our prisons.
"What we see is those low-level drug couriers mixing with gangs and getting better connected and then getting deported," Bamford says.
He said this could lead to groups becoming the "mini-syndicate of the future".
"Often they're reasonably low-level, which is why they have the drugs in the bag or strapped to their bodies."
Bamford says Customs was also working with the Ministry of Foreign Affairs and Trade (MFAT) to ensure the diplomatic community in New Zealand and those who provide consulate services are well-informed and can provide the correct advice.
The claim was made in court during the sentencing of Marlon Batista De Macedo, who was stopped at the border last year with up to $1.68m-worth of cocaine in his suitcase. He will serve at least half his eight years and six months in a Kiwi prison.
"There is an effort under way to make sure people are aware of the differences," Bamford said.
MFAT says it supports Customs to engage with overseas diplomatic posts in New Zealand to discuss counter-drug cooperation.
"Generally speaking, MFAT helps facilitate formal law enforcement cooperation between states and contributes to the development of New Zealand's international criminal law," a ministry spokesman says.
"This includes policy around transnational organised crime. The targeting of international drug supply chains and transnational cartels is an operational matter for law enforcement agencies."
Customs Minister Meka Whaitiri said during the Budget announcement that criminal groups were motivated by greed and relatively high prices in New Zealand, and are getting more sophisticated.
"New initiatives will disrupt international drug-smuggling networks early in the supply chain by making seizures offshore, while also boosting onshore capabilities through more maritime patrols, frontline resources and community engagement," she said.
A further $3.9m will also be injected into New Zealand's maritime and frontline operations, including new rigid-hull inflatable boats, mobile x-ray vans, and vehicles and kennels for Customs' detector-dog teams.
