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Man at centre $500million Serbian drug bust went bankrupt

Australian businessman Rohan Arnold, alleged by police to be at the centre of a $500 million Serbian drug bust, was millions of dollars in debt and recommended to ASIC by a liquidator to be investigated by the Federal Court after a series of failed international ventures.

Rohan Arnold – dubbed the ‘king of steel’ for his roaring success in the industry – was arrested at gunpoint inside the Metropol Palace Hotel, in Belgrade, last week alongside 48-year-old business associate David Campbell.

It is understood that Mr Campbell was detained by the Serbian Police in relation to ‘authorised possession and carrying of weapons’.

Tristan Waters and Lebanese man Diab George were also arrested while drinking with the two businessmen in the hotel lobby. Serbian state media have reported that Mr George was detained on suspicion of having a fake passport. 

Arnold’s company Mass Steel were $11.5 million in debt after their Canberra-based venture struggled to deal with cheap Chinese mass imports, Fairfax reported.

The lawyer for the three Australians, Jaska Pekovic, has reportedly told colleagues he is seeking the release of Arnold and Waters today as they are facing no charges in Serbia and an extradition request is yet to be released.    

Waters, a former Canberra nightclub bouncer turned billionaire construction owner, has been labelled as a ‘big narco boss’ by the Serbian media.

All four are suspected by the Australian Federal Police of having ties to an international drug syndicate – which allegedly attempted to smuggle 1.28 tonnes worth of cocaine into Sydney from China last year.

Australian businessman Rohan Arnold, alleged by police to be at the centre of a $500 million Serbian drug bust, was millions of dollars in debt and recommended to ASIC by a liquidator to be investigated by the Federal Court after a series of failed international ventures 

Rohan Arnold (right) was arrested at gunpoint inside the Metropol Palace Hotel, in Belgrade, last week alongside business associate David Campbell (left)

Rohan Arnold (right) was arrested at gunpoint inside the Metropol Palace Hotel, in Belgrade, last week alongside business associate David Campbell (left)

Rohan Arnold (right) was arrested by Serbian police at gunpoint inside the Metropol Palace Hotel, in Belgrade, last week alongside business associate David Campbell (left)

Tristan Waters and Lebanese man Diab George were also arrested while drinking with the two businessmen in the hotel lobby 

Tristan Waters and Lebanese man Diab George were also arrested while drinking with the two businessmen in the hotel lobby 

Arnold and Campbell are long-term business associates, but the former ran into deep financial trouble when his company was unable to match the costs of their Chinese counterparts.

The liquidators accuse Arnold of ‘phoenix’ activity, the transfer of assets from a company in debt to a new company to avoid paying employees, creditors and/or tax.

They liquidators appointed to the companies also alleged Arnold may have traded while insolvent, and suggested to ASIC that he be investigated in Federal Court, but Fairfax reported no action was taken.

‘They were always difficult to get money from,’ a former business associate said.

They also described Campbell as ‘the most difficult pr*** I have ever dealt with’. 

Campbell is being held on suspicion of carrying an unauthorised gun, while Arnold is suspected of laundering money for Waters.

Waters, reportedly manager of a security firm based in the ACT before moving on to build his own construction firm called Triswat, is suspected of purchasing the cocaine.

The businessman, who is now based in Dubai, was also reportedly connected to multiple companies linked to the ATO tax fraud syndicate run by Adam Cranston, the son of then ATO deputy commissioner Michael Cranston.

Arnold is a director of South East Livestock Exchange and also his own company 'Arnold Co' - a major player in the NSW construction industry

Arnold is a director of South East Livestock Exchange and also his own company ‘Arnold Co’ – a major player in the NSW construction industry

Campbell's lawyer is planning to have him and Waters released as early as Monday, arguing there is no legal basis in which to keep the pair in Serbia

Campbell’s lawyer is planning to have him and Waters released as early as Monday, arguing there is no legal basis in which to keep the pair in Serbia

Campbell’s lawyer is planning to have him and Waters released as early as Monday, arguing there is no legal basis in which to keep the pair in Serbia.

He is also considering an application to have Waters moved to a hospital instead of his holding cell as he has a pre-existing medical condition.

Campbell and Waters’ lawyer Mr Pekovic said the pair strongly deny any involvement. 

The Serbian High Court however say Campbell has been remanded in custody for 30 days as they have fears he may abscond.

‘It was just about the circumstances of the detention and not the criminal case. Where he lives, what he was doing jn Belgrade,’ Higher Court spokeswoman Bojana Stankovic said.

‘The judge ordered detention for 30 days… because of the risk of escape.’

A spokeswoman for the Serbian High Court, Bojana Stankovic (pictured), said Campbell has been remanded in custody for 30 days as they have fears he may abscond

A spokeswoman for the Serbian High Court, Bojana Stankovic (pictured), said Campbell has been remanded in custody for 30 days as they have fears he may abscond

He is also considering an application to have Waters moved to a hospital instead of his holding cell as he has a pre-existing medical condition 

He is also considering an application to have Waters moved to a hospital instead of his holding cell as he has a pre-existing medical condition 

The four men were dramatically arrested in the lobby (pictured) of the lavish hotel in Belgrade

The four men were dramatically arrested in the lobby (pictured) of the lavish hotel in Belgrade

Australian Federal Police released a statement hours after the Serbian bust about the seizure, saying they had linked the three men to a the major drug bust in April.

‘Operation Amorgos commenced in April 2017, with the interception of a container of pre-fabricated steel arriving into Sydney from a source country via China,’ the statement read.

‘AFP investigators commenced a tenacious nine-month investigation to pursue those allegedly responsible for this importation.

‘No arrests have been made in Australia at this time, though investigations remain ongoing.’

Police said the men ‘are linked to’ the discovery of 1,280 kilograms of cocaine that was seized last April on a Chinese boat docked in Sydney.

They said the drugs were worth (AUD)$500 million.

Waters was a director of CREI Camperdown set up by Dev Menon, the Sydney lawyer who allegedly provided tax advice to the ATO syndicate, Fairfax reports.

Mr Arnold is a director of South East Livestock Exchange and also his own company ‘Arnold Co’ – a major player in the NSW construction industry.

The father-of-four was born and educated in Canberra where he graduated with a commerce degree in 1995, according to his business website.

Just days ago, he wrote on his personal blog that the global steel industry was thriving and that he was optimistic about the future.

‘Global demand for mass steel looks likely to increase in 2018, with emerging economies including Latin America and the Middle East experiencing strong urban development,’ he wrote.

This picture shows the table and lounge the men had been sitting on before they were arrested, as well as a bag police say contained various forms of currency 

This picture shows the table and lounge the men had been sitting on before they were arrested, as well as a bag police say contained various forms of currency 

Arnold (pictured) has had a 20-year career in the steel manufacturing industry 

Arnold (pictured) has had a 20-year career in the steel manufacturing industry 

Arnold’s 20-year career in the steel industry and subsequent affluence has gifted him opportunities like competing in the Sydney to Hobart for a third time in 2017.

But just three weeks after successfully completing the prestigious yacht race, he finds himself accused by police of being at the centre of the second largest cocaine seizure in Australian history.

Mr Arnold is alleged to have first came to the attention of Australian Federal Police after they captured a 1.28 tonne cocaine haul – with a street value of close to $500million – hidden on a shipment of pre-fabricated steel which travelled from China to Sydney last April.

Following his dramatic arrest in Belgrade, the AFP on Wednesday raided Mr Arnold’s home where he lives with his family on the NSW-ACT border.

One of his business premises in Goulburn was also searched – as were properties in Jeir and Canberra.

The bag was filled with cash including about $600,000 Euros and $10,000 Australian dollars, police said

The bag was filled with cash including about $600,000 Euros and $10,000 Australian dollars, police said

The AFP on Wednesday raided Mr Arnold's home where he lives with his family on the NSW-ACT border 

The AFP on Wednesday raided Mr Arnold’s home where he lives with his family on the NSW-ACT border 

Video showed Mr Arnold sitting inside the lobby of the Belgrade hotel with three other men, completely unaware they were about to be raided by police.

The footage, released by Serbian authorities, showed officers throw the men to the ground during what police allege was a ‘money handover’.

Officers said they found a bag filled with various forms of currency, including approximately $600,000 Euros and $10,000 Australian dollars.

One of Arnold’s colleagues told Daily Mail Australia he was shocked to learn of his arrest in Serbia, saying he assumed Arnold had travelled to China.

‘I spoke to him the other day and he said he was going overseas for a week but he’d be back before Sunday [for the opening of a new stock yard],’ Brendan Abbey said.

‘I was under the impression he was off to China. He went there often because he has interests in steel there.

Police are pictured storming into the Belgrade hotel moments before the dramatic arrests

Police are pictured storming into the Belgrade hotel moments before the dramatic arrests

A Serbian police officer is seen opening a bag which they said contained various forms of currency  

A Serbian police officer is seen opening a bag which they said contained various forms of currency  

One of the four men is taken into custody after being arrested over alleged links to a one tonne cocaine bust

One of the four men is taken into custody after being arrested over alleged links to a one tonne cocaine bust

‘We’re just in shock, utter shock. It’s got nothing to do with us though.’

In a statement released on Thursday, the South East Livestock Exchange (SELX) said its business was not involved in any way with the police operation.

‘SELX Pty Ltd owns livestock selling centres at Yass (SELX) and Mortlake (WVLX),’ the statement read.

‘The Directors of SELX Pty Ltd have become aware through the media that Rohan Arnold a Director of SELX Pty Ltd has been arrested by Serbian authorities in Belgrade.

‘The operation and management of SELX and WVLX are not affected by this development. Livestock sales will continue as scheduled.’

Mr Arnold first came to the attention of Australian Federal Police after they captured a 1.28 tonne cocaine haul

Mr Arnold first came to the attention of Australian Federal Police after they captured a 1.28 tonne cocaine haul

A block of cocaine is pictured after it was seized in what was the second largest haul of the drug in Australian history

A block of cocaine is pictured after it was seized in what was the second largest haul of the drug in Australian history

Arnold's lawyer said he expects his client (pictured) to be back in Australia within six weeks if he is not charged

Arnold’s lawyer said he expects his client (pictured) to be back in Australia within six weeks if he is not charged

The Arnold Co. website says it ‘removes the unknown risks associated procurement with primarily construction related products from China’.

Mr Arnold’s defence lawyer told The Sydney Morning Herald he was in the process of organising to see him in Serbia.

‘That will be co-ordinated through [the Department of Foreign Affairs and Trade],’ Ben Aulich said on Thursday.

‘If everything is co-ordinated smoothly and he is not facing charges in Serbia, then we expect him back in the country within four to six weeks.’ 

Video showed Mr Arnold sitting inside the lobby of the Belgrade hotel with three other men before police pounced

Video showed Mr Arnold sitting inside the lobby of the Belgrade hotel with three other men before police pounced

Serbian authorities are seen entering the hotel before arresting the three Australians and a Lebanese man

Serbian authorities are seen entering the hotel before arresting the three Australians and a Lebanese man

 

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