‘Suitcases of cash' smuggled into country to buy local crops

'Suitcases of cash' smuggled into country to buy local crops


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The federal government's Black Economy Taskforce is investigating allegations that foreign exporters are smuggling "suitcases of money" into the country to buy crops.

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The powerful federal government's Black Economy Taskforce is investigating allegations that foreign exporters, often on tourist visas, are smuggling "suitcases of money" into the country to buy crops that are still in the ground, or on the vine.

Victorian and South Australian farmers claim they are being paid up to $56,000 in bundles of $50 and $100 notes by Chinese exporters for filling shipping containers with cartons of grapes that are directly shipped to mainland China.

Teams of indentured Asian labourers, mostly paid less than half minimum Australian wages, are then used to pick and pack the grapes that are loaded into the airconditioned 40-foot containers for transport to the nearest port, agricultural labour specialists claim.

A fast-growing cash economy in the horticultural industry is threatening standards, undermining work conditions and potentially jeopardising the nation's reputation as a first-class exporter, according to Dominic Jenkin, chief executive of the Australian Horticultural Exporters' Association.

Mr Jenkin believes a small number of farmers and exporters are involved in the cash deals and that many established relationships have played a big part in the quadrupling of export sales in the past three years to $175 million.

Many farmers claim foreign exporters offer lucrative terms, prompt payment, full documentation and efficient service.

But there are concerns the growing black economy in horticulture is a snapshot of what is also happening across the bigger agricultural sectors, one of the nation's biggest exporters, and broader economy.

Mr Jenkin fears powerful foreign organised crime gangs, which are already big players in the distribution and sale of illicit drugs, could be using the deals for money laundering.

There are suspicions the exports are dodging the traditional export procedures, including inspections, taxes and contributions to industry levies used for research to improve crop quality.

Popular Mandarin language websites advertise for fruit pickers and labourers on Australian farms.

Many are on student or working tourist visas, are forced to pay large bonds, are underpaid, denied mandatory benefits, such as work cover and superannuation, and have their passports confiscated for the term of the contract, according to Casey Brown, managing director of Agri Labour, the nation's largest agricultural labour consultancy.

Farmers, trade bodies and industry groups raised concerns with Michael Andrew, taskforce chair and former global chief of KPMG, during a recent national road show for feedback about the nation's cash economy.

Mr Clark is concerned that an ingrained cash economy will give a competitive edge to businesses that evade their wage and tax liabilities, forcing others who "want to do the right thing" to follow.

The taskforce's recommendations are being reviewed in the lead-up to the October deadline.

Many growers complain they have no other options than to use shadowy facilitators to provide illegal pickers because of a need to harvest crops and a shortage of local labour.

They also claim they do not have the time or resources to check whether illegal labour is being offered and that promises of a government crackdown have failed to produce any results.

Pressure on margins is also driving some growers into the black economy because they are only able to maintain turnover by reducing costs.

This article first appeared on The Australian Financial Review.

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