Drug financed lavish lifestyle

16:00, Feb 28 2014
Brian Anthony McCarthy
RINGLEADER: Brian Anthony McCarthy is photographed by police after harvesting cannabis.

To ACC, Brian Anthony McCarthy was an unusual client.

On the face of it, the Queenstown resident was a modest man with a close-knit group of friends and a passion for hunting.

But when he injured himself six years ago he turned down an offer of weekly compensation from ACC. He never told them why.

It turns out he was living under the radar, funding his lifestyle using cash earned as the kingpin of a multimillion- dollar drug syndicate.

This week, after a High Court judge approved a deal regarding the forfeiture of McCarthy's New Zealand-based assets, an affidavit was obtained by The Press that suggests the drug dealer refused help from ACC because he would have been required to provide proof of his income.

He had not done that in decades and had dodged paying hundreds of thousands of dollars in tax.


McCarthy, 63, was among seven men arrested at the conclusion of a three-and-a-half-year Southland police investigation codenamed Canary. The operation, which ended in 2012, netted cannabis with an estimated street value of more than $4.5 million. It is among the largest busts of its kind in the South Island.

McCarthy eventually pleaded guilty to charges relating to the cultivation, possession and supply of cannabis and was sentenced to four years and three months' jail late last year.

At the time, Justice David Gendall said McCarthy had been a major participant in a cannabis drug ring that set up substantial plots, harvested drugs and sold cannabis during offending identified between October 2008 and May 2012.

However, police believed his dodgy dealings began about the time he stopped paying taxes some 20 years ago.

Inland Revenue (IRD) would not talk about the specifics of McCarthy's tax evasion. However, police and the department worked together on the case to try to recoup what he owed, a spokeswoman said.

McCarthy's Queenstown home, which had a rateable value of $620,000, and $112,000 from a trust account he controlled, have been forfeited to the Crown.

Property owned by other alleged members of the syndicate, still awaiting trial, has also been seized.

The IRD spokeswoman said it was difficult to measure the scale of tax evasion in New Zealand because the size of the country's "hidden economy" was not known.

"The consequences of deliberate failure to meet your tax obligations can be very serious and we do take action," she said.

McCarthy, a former hunting guide, lived a modest lifestyle from his home in Arthurs Point, Queenstown. He had previous convictions for drink-driving and wilful damage.

Every year, after the cannabis growing season finished, he would fly to Thailand where he owned property, including an apartment, police said. He had a Thai wife but they have separated. It's understood she is now working as a prostitute in Sydney.

The affidavit obtained by The Press shows the drug syndicate McCarthy spearheaded began to unravel when a member of the public alerted police to a cannabis plot containing 50 plants in an area of bush known as Monowai in Southland in 2008.

It was surrounded by netting and an electric fence powered by a portable battery. Police forensically investigated the scene but found no usable evidence.

During the next four years police, led by Detective Sergeant John Kean and Detective Regan Boucher, identified similar plots they believed were being cultivated by the same group of growers.

Forensic evidence was hard to come by so they had to employ surveillance techniques to build a case.

The court document shows police put tracking devices on vehicles, planted listening devices in homes, tapped phone conversations and used hidden cameras during their investigation.

They captured hundreds of images of armed men who had disguised their faces with light-coloured muslin cloths, scarves, or balaclavas tending the cannabis plots.

They watched and listened as drug deals went down.

In May 2012, when Operation Canary ended, detectives stopped a car driven by McCarthy in Dunedin and found 4.5 kilograms of cannabis in the boot. He was in the city delivering drugs to a client. Days later, police raided a home in Kelvin Heights that was used to store and process cannabis harvested by the syndicate. Inside drums on the property, they found 24kg of cannabis head.

At McCarthy's home they found gardening tools and books about gardening but no garden.

In total, police seized 361 cannabis plants and about 40kg of cannabis head during the final year of the operation.

Hundreds of other plants grown by the syndicate were seized during the first four years of the investigation.

The Press