Talking to Your Kids About Drugs

Alcohol is a Drug

After reading the Howard government’s pre-election booklet Talking to your kids about drugs you might think that alcohol is not a drug. Of course, this is not so. Alcohol is our most dangerous drug because it is so readily available and because we culturally misuse alcohol. However, the alcohol industry has purchased a privileged position in the drug debate.

The Australian media regularly portray excessive use of alcohol as patriotic and heroic, repeatedly showing Australian sporting teams (like the Storm and Geelong) celebrating victory by drenching themselves in alcohol. By contrast, a footballer caught with a Valium tablet is regarded as an evil beyond the pale! Political parties reflect this double standard. They also celebrate their victories with alcoholic binges, while John Howard spends tens of thousands of dollars, lavishly entertaining his guests with expensive alcoholic drinks.

Both the media and the political parties receive enormous amounts of money from the alcohol industry in the form of advertising and political donations. For example when Peter Hurley, the South Australian President of the Australian Hotels Association, the AHA, was appointed by the Howard government to the ABC Board, the Melbourne Age revealed Hurley had increased the coffers of Australia’s governing party through ‘liberal’ private donations as well as by organising donations to the Liberal Party by the Hotels Association. The Deputy Chair of the ABC Board, John Gallagher QC, also has links with the Hotels industry.

Through its influence with politicians, the alcohol industry controls strategic chokepoints in the public media. Through the power of its advertising dollar it exerts enormous influence on the commercial media and so Australia’s extensive alcohol problem goes underreported.


Drug Taking is Normal

Even if we accept the fiction that alcohol is not a drug (and we shouldn’t), surveys of the 20-29 year old population repeatedly show that drug taking is normal. For the past two decades, surveys have shown that the majority of the 20-29 year old population has used cannabis at some time. The use of ecstasy and speed is also prevalent. Although illicit drug use is routinely portrayed as deviant behaviour, the fact is that 20-somethings who don’t take drugs are the deviants.

Like sex, drugs are an activity most young Australians will explore. The War on Drugs has proved counter-productive, creating a ‘forbidden fruit’ syndrome that has glamorised drug use amongst the young. The result has been the emergence of the twenty-something lifestyle, famously characterised by sex, drugs and rock’n’roll.


Tough on Drugs is a Cynical Misuse of Drugs Policy

For politicians like Howard, the failure of their drugs policy has been a good thing because it has meant that they have been able to scapegoat drug users in their crusade against the ‘evils of drugs’ for three decades. Back in 1976, Howard was in control of the Narcotics Bureau during the Fraser government. Howard and Queensland premier Bjelke-Petersen launched a massive police and navy raid on an isolated hippie colony in north Queensland called Cedar Bay. Houses were burnt down and gardens were destroyed as the Queensland police went on a rampage. Bjelke-Petersen and Howard defended their action, proclaiming they were “Tough on drugs” and harsh measures were needed to drive marijuana smokers out of Queensland!

Of course, this didn’t work then and it doesn’t work now. Nonetheless, the Liberals repeatedly claim victory in the war against drugs with the aid of dubious statistics. However, the truth is that every year more people go to jail for drugs, every year we spend more on drug law enforcement, and every year there are more drugs on the street.

The Talking with your kids about drugs booklet is another recycled effort, a repeat of a similar pre-election campaign in 2001. Such efforts have been repeatedly unsuccessful, nothing but cynical appeals to parent’s unconscious fears about their children and drugs to garner votes. It also generates confrontation between parents and children, causing them to blame each other or the ‘drugs’, rather than Howard for the appalling results of our drugs policy.

Rather than solving drug problems, Tough on Drugs has greatly increased our problem. More young Australians have died through drug overdoses during the Howard years than at any other time in our history. Indeed, during the Howard years drug overdose deaths became the second greatest cause of death among young people after road accidents!

However, like the War on Terror, an endless War on Drugs has been a boon to Howard because by making the problem far worse he has been able to frighten the public to give support to his extreme measures. Like the Chaser team, Howard’s War on Everything has proved electorally popular in previous elections and the major motivation of a booklet like Talking to your kids about drugs is to convince voters to re-elect the Howard government.


Use Common Sense

Rather than instructing the young with Liberal Party inspired anti-drugs hysteria that will be derided by their peers, the best approach is to encourage common-sense attitudes to drugs.

Humans have been exploring drugs for millions of years, and a large part of our medical knowledge has been derived from this pursuit. Exploring drugs can be fascinating and rewarding, but with all such explorations you need to be informed of dangers, and with drugs the two major problems are overdoses and addiction.



The most important question you need to understand is this:

What is the difference between a drug and a poison?

The answer is: Dosage.

Every drug has an effective dose, and every drug has an overdose. Even drugs like strychnine and arsenic which are well-known poisons in large doses have non-lethal levels where they have a stimulating effect. Indeed, in past centuries, because drugs like coca and cannabis were unknown, drugs like strychnine and arsenic were used as recreational drugs in Europe and arsenic was a drug of abuse in nineteenth century Europe and there were arsenic addicts! (Some even argue that Napoleon was an arsenic addict.)

Maybe your poison isn’t arsenic, but it is important to understand that nearly every drug is a poison at certain levels. Of course, this famously does not hold for cannabis, but this is why cannabis is regarded as a ‘soft’ drug. Nearly every other drug can be lethal at high doses. The famous last words of the Welsh poet, Dylan Thomas, were: “I’ve just had eighteen double whiskeys. I think that’s the record.”


Avoid Drug Pigs

The most stupid animal in this regard is the ‘Drug Pig’. In Australia, drug pigs are numerous and you may be unfortunate enough to know several. These misguided young people actually believe that the more drugs you take, the more heroic you are. Nothing could be more dim-witted. The more drugs you take, the closer you get to an overdose and the further away you get from the effective dose. Drug pigs are ignorant and naïve users who do not know how to use drugs sensibly and the most levelheaded use of health dollars would be to target and educate drug pigs.

The drug pig attitude seems to be particularly prevalent with alcohol and even intelligent people, like Dylan Thomas, drink themselves to death. With drugs, less is good, while more is often fatal.



Sadly, addiction is often inevitable with drug use, and certain drugs like cocaine and heroin seem to be particularly addictive. For this reason, it is best to avoid repeated use of these substances. But even soft drugs like tea, coffee and cannabis are addictive. If you are using drugs, you need to recognize the problem of addiction by limiting your drug taking behaviour, by setting boundaries such as the 4.20 rule (not smoking before 4.20pm), or by periods of abstention. Addiction results from repeated use so you have to break the pattern of repeated use by abstention or by substituting another drug.


Dr John Jiggens.

“Talking to Your Kids About Drugs”, StickyPoint Magazine Issue 04 (2008)
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The Origins of Marijuana Prohibition in Australia

In April 1938, the front page of the Australian newspaper, Smith’s Weekly, was dominated by a headline that shrieked ‘New Drug That Maddens Victims’. The article was subtitled ‘WARNING FROM AMERICA’ (which provided a clue to its author) and informed readers that the ‘PLANT GROWS WILD IN QUEENSLAND’. The plant in question was Cannabis Sativa; and this ‘new drug that maddens victims’ was marijuana. This article introduced Australian’s to the word marijuana and the Smith’s Weekly article marked the start of an American-inspired ‘Reefer Madness’ campaign in Australia. The article began:

“A MEXICAN drug that drives men and women to the wildest sexual excesses has made its first appearance in Australia. It distorts moral values and leads to degrading sexual extravagances. It is called marihuana. Marihuana is obtained from a plant (Cannabis Sativa) that has been discovered growing wild in many of the coastal parts of Queensland.”

Although the article was attributed to Smith’s Weekly’s Hawaiian correspondent, some familiar examples from Anslinger’s article ‘Marihuana Assassin of Youth’ published in The American Magazinein July 1937 indicate that the hand behind this was Harry Anslinger and the US Bureau of Narcotics, a fact subsequent stories confirmed. According to the article, ‘Cannabis Sativa was growing wild in Queensland.’ Indeed there were ‘acres of it’.

“There are places on the Queensland coast, some of them within a few miles of Brisbane, where the long-leafed plant, Cannabis Sativa, is to be seen growing freely and in the districts further north it literally flourishes in many places. Not far from Flying Fish Point, six miles from Innisfail, and situated at the mouth of the Johnstone River, is a patch of it which covers five or six acres. Farther along the coast, near Babinda, it is to be seen in plenty – also around Trinity Bay and near Port Douglas.

Much farther south, around Montville, it grows with more or less freedom, its deadly qualities completely unsuspected by those who see it every day and know it by one or the other of the vernacular names it possesses. Its occurrence has been reported from Caloundra, lately become one of Brisbane’s most fashionable holiday resorts, and it grows in profusion in parts of Moreton and Stradbroke Islands.”

This article created a marihuana panic and introduced Australians for the first time to the word ‘marihuana’. According to the article, Cannabis Sativa (marihuana) was a new kind of superweed with the potency attributed to skunk in our era. The article stated:

“Both botanically and chemically Cannabis Sativa is closely allied to Cannabis Indica, from which Indian hemp or hashish, well-known for its violently sex-stimulating effects, is prepared, with the difference that the action of C Sativa is twenty times more potent than is that of C. Indica.

Under the influence of the newer drug, the addict becomes at times almost an uncontrollable sex-maniac, able to obtain satisfaction only from the most appalling of perversions and orgies. Its effect is the same on either sex.”

Of course, this has no basis in botany or medicine. There are several members of the genus cannabis, including two cultivated species: Cannabis Sativa and Cannabis Indica. European hemp or Cannabis Sativa had a long history of use as a seed or fibre crop but it was never used for drug production. Drug cannabis was known in Australia as Indian hemp and was regulated under the Poisons Act asCannabis Indica. Before the introduction of the word ‘marihuana’ in 1938, drug cannabis was widely used in Australia but it was called Cannabis Indica.

So the renaming of drug cannabis as marihuana caused considerable confusion in 1938 and allowed the Bureau of Narcotics to promote ‘marihuana’ as a new drug menace in Australia, even though Australians had a long and untroubled history of cannabis use. As the Director General of Health, Dr JHL Cumpston would shortly inform the Prime Minister’s Department, this ‘new drug that maddens victims’ had been used in Australia for decades.

The furore unleashed by the Smith’s Weekly marihuanaarticle prompted DJ Gilbert of the Prime Minister’s Department to write a memo to the Director General of Health.

“Occasionally the blood curdling noises of Smith’s leads to the spot marked X. If it is true that the plant which is spreading in our midst is as naughty as charged, your department may deem it necessary to become interested.”

Dr Cumpston replied to the Prime Minister’s Department in May 1938, advising them that the ‘New Drug that maddens victims’ was not new and had been known about for decades:

“With reference to the front page from Smith’s Weekly of the 23 April 1938 containing a “warning from America” concerning a “New Drug that maddens victims” obtainable from Indian Hemp and that the “plant grows wild in Queensland”, I have to advise that the drug has been known for decades and the hemp plant has been under cultivation in Australia for over 50 years. Being a tropical plant – native of India and Western Asia – it has probably grown wild (now acclimatised) more extensively in Queensland than in the more temperate climates of New South Wales and Victoria. When the plant is cultivated for fibre production, it is harvested quite early, before the pistillate flowers are fully developed, consequently little resin would be obtainable from a crop grown only for fibre.”

Dr John Howard Lidgett Cumpston was appointed as Australia’s first Director-General of the Commonwealth Health Department in 1921, serving until his resignation in 1945. In 1925 when the Prime Minister’s Department sought his advice on the proposal by the League of Nations to include cannabis in the convention on habit-forming drugs, Cumpston opposed the move, advising the government the only regulations on habit-forming drugs were concerned with opium and that Cannabis Indica was included in the various lists of poisons under the state Acts, and was sufficiently under control.

As a result of the Smith’s Weekly ‘New Drug That Maddens Victims’ story Dr Cumpston started the Department of Health’s marihuana file, Drugs and Medicines: Marihuana. The earliest items in the marihuana file were: a copy of the Smith’s Weekly April 1938 article ‘New Drug That Maddens Victims’, a similar article from The Sun in Sydney from 26 April 1938 ‘Marihuana Drug Killer Of Souls’, the letter from DJ Gilbert from the Prime Minister’s Department about the ‘New Drug That Maddens Victims’ article in Smith’s Weekly, Cumpston’s reply to Gilbert and two heavily underlined articles that formed the basis of Cumpston’s reply to Gilbert. The first of these was the section ‘Cannabis Indica, B.P. Indian Hemp’ from the British Pharmaceutical Codex 1911 and the other was ‘Illicit Traffic in Cannabis’ from the US Bureau of Narcotics. Two countervailing views of cannabis policy were colliding: Cumpston represented an ‘Australian’ model, which was medically based, and was represented by the article on Cannabis Indica from The British Pharmaceutical Codex 1911; Anslinger’s views and policies were represented in ‘Illicit Traffic in Cannabis’ and were distinguished by their use of the ‘marihuana’ word and their call for national and global laws similar to the Opium convention to regulate the importation of cannabis.

The disease Cumpston was being asked to administer was a moral panic created by sensational stories like ‘New Drug That Maddens Victims’ and ‘Marihuana Drug Killer Of Souls’ which were inspired by the incredible ‘reefer-madness’ views of Anslinger. While the newspapers unleashed an epidemic of fear, Cumpston’s sensible, well-considered advice would not be heeded. Gilbert’s opening sentences about ‘the blood curdling noises of Smith’s’ were apt. Smith’s noises were blood curdling and the yelpings of the rest of the press pack drowned out all reasonable discourse.

The Second Smith’s Weekly Article

Seven weeks after its first ‘reefer madness’ article, on June 11 1938, Smith’s Weekly delivered the second article in its series ‘Drugged Cigarettes: G-Man Warns Australia: FIRST DOPED PACKETS SNEAKED IN’.

“A FEW cigarettes containing marihuana – the drug which causes its victims to behave like raving sex maniacs, and has made pathetic slaves of thousands of young Americans – have been smoked at recent parties in Sydney.”

The G-Man in question was AM Bangs, the head of the Bureau of Narcotics in Hawaii, one of Anslinger’s deputies, whose photo adorned the cover of this issue of Smith’s Weekly. Bangs was quoted as saying that ‘Undoubtedly, if prompt action is not taken, marihuana will flood Australia and New Zealand’.

For Smith’s credulous readers, Bangs described the situation in Hawaii where his ‘special squad of Washington G-Men’ were smashing this ‘vicious racket’.

“Continually, marihuana dens in Honolulu are being cracked open by raiding squads. The drugged victims are like punch-drunk fighters. They cannot be questioned for hours, sometimes days.

The women sit on their cell cots, their faces and clothes ripped, trying to piece together what they did in their orgy of lust. The men slowly come out of the stupor that gave them frenzied sexual desires and colossal physical strengths.”

This article also ended with direct quotes from Anslinger’s ‘Marihuana – Assassin of Youth’further confirming the Bureau of Narcotics’ connection.

The Smith’s article was lurid, rubbish, but it would have a lasting effect on Australian drug policy.

Shortly after the Marijuana Tax Act became law in the US in 1937, the US Consul in Sydney wrote to the Australian government, informing them about the Act and requesting information about Australian laws on the importation of cannabis, asking that five copies of each state’s cannabis regulations should be forwarded to the Treasury Department in Washington. An information sheet from the Bureau of Narcotics about the perils of marihuana called ‘Illicit Traffic in Cannabis’ (which proposed national and international laws similar to the Opium convention to regulate the importation of cannabis) was included. As a former diplomat, the head of the Bureau of Narcotics, Harry Anslinger, was probably behind this request. Anslinger had previously worked for the Sate Department and knew how to use the consular system to exert pressure on lagging governments. He would have been delighted with the result. The next day; on the 27 October 1937 the Minister for External Affairs, RG Menzies, wrote to the Secretary-General of the League of Nations giving the agreement of the Australian government to the inclusion of Indian hemp extract or tincture within the scope of Article 10 of the International Convention relating to Dangerous Drugs signed at Geneva on 19th February 1925. Once Australia signed the convention, states like South Australia who’s Advisory Committee under the Food and Drugs Act opposed the extension of the provisions of the Dangerous Drug Act to Indian Hemp were forced into compliance on the 20th February 1941.

The Smith’s Weekly’s series of marihuana articles appeared some months later. They were also inspired by Anslinger. The second Smith’s article relied mainly on Anker Bangs, Anslinger’s Hawaiian deputy; and both the Smith’s Weekly articles and other articles from the time of the moral panic like ‘Marihuana Drug Killer Of Souls’, used examples from Anslinger’s ‘Marihuana, Assassin of Youth’ and his so-called ‘Gore Files’ on marihuana. Australia’s drug policy was Americanised, Anslinger-ised, after 1937 through the manipulation of the diplomatic power of the US state and by the inspiration a ‘Marihuana Sex Drug’ moral panic in the Australian press.


Sidebar: Indian hemp

While the word ‘marijuana’ was unknown in Australia before 1938, drug cannabis was very well-known. In the pharmacopoeias of the time drug cannabis was listed as Cannabis Indica. The name means Indian hemp, and the drug comes from the leaves and flowers of a plant that had been cultivated in India for millennia and which the Indians called ganja or bang. Originally an Indian plant, its use spread, first around the Indian Ocean, and then, at a later stage, around the Mediterranean, becoming widely known in Europe only in the nineteenth century.

The first major English work on the medical properties of the Indian hemp plant was Dr W. B. O’Shaughnessy’s On The Preparation of Indian Hemp Cannabis Indica in 1839. The Fifth Edition of the United States Dispensatory (1843) summarised Dr. O’Shaughnessy on the effects of cannabis ‘it alleviates pain, exhilarates the spirits, increases the appetite, acts decidedly as an aphrodisiac, produces sleep, and in large doses, occasions intoxication, a peculiar kind of delirium, and catalepsy’ and added ‘Its operation, in the hands of Dr. Pereira, appeared to resemble very much that of opium’ Since opium was the great herb of western medicine, this was high praise.

In 1860 in America the Ohio State Medical society convened a committee to examine the use of Cannabis Indica in medicine and they claimed successful treatment of neuralgic pain, dysmenorrhoea, uterine bleeding, hysteria, delirium tremens, whooping cough, infantile convulsions, asthma, gonorrhoea, chronic bronchitis, muscular spasm, tetanus, epilepsy and lack of appetite. It was considered by several physicians specific in menorrhagia (excessive menstrual flow) and it was widely used to dull the pain of childbirth; it was also used to alleviate migraine, and it was recommended as a remedy for this condition by Sir William Osler. Many of these medical uses for cannabis ‑ its effectiveness as an anti-convulsant and as an anti-spasmodic; its ability to stimulate the appetite; its reputation as an aphrodisiac; its ability to suppress nausea were rediscovered by marijuana users in the 1970s.

The section on Cannabis Indica in the British Pharmacopeia Codex 1911 (which Dr Cumpston relied on when drafting his reply to Gilbert) stated that the drug acted chiefly on the central nervous system. ‘It first produces excitement with hallucinations, a feeling of happiness and indifference to surroundings, this stage being followed by deep sleep. The hallucinations include inability to estimate time and space …. It is used as an anodyne sedative or hypnotic, in mania, spasmodic coughs, phthisis, asthma, acute neuralgia, dysmenorrhoea, and tetanus. It does not produce constipation nor loss of appetite.’ This last comment was obviously meant to distinguish it from opium which had many similar uses, but which produced these undesirable side effects.

In 1938 drug policy in Australia was based on the British model and was firmly in the hands of members of the medical profession like Dr Cumpston. A decade before in 1926, the report of the Rolleston Committee had addressed the problems of opiate addiction and drugs policy. Dominated by doctors, it opted for the medical definition of addiction. Addicts were defined, not as the ‘dope fiends’ of the popular press, but as ‘a person who, not requiring the continued use of the drug for relief of the symptoms of organic disease, has acquired, as a result of repeated administration, an overpowering desire for its continuance, and in whom withdrawal of the drug leads to definite symptoms of mental or physical distress or disorder.’ Addiction was seen as a disease, not as a vicious, criminal indulgence and was treated as such.

In 1938 dozens of cannabis-based remedies were readily available, either by prescription or over the counter, in Australia. The most famous of them, Dr J Collis Browns Chlorodyne, proved an immensely popular medicine in Australia over many decades. Its simple, yet effective recipe ; six grams of black Nepalese hash dissolved in chloroform and topped up with morphine made it the country’s favourite panacea, and it was widely imitated by rivals who produced their own proprietry chlorodynes, such as Faulding’s Chlorodyne and Freeman’s Chlorodyne and the strikingly named Dr Poppy’s Wonder Elixir (with cannabis extract). The British Pharmaceutical Codex 1911 noted that ‘Tincture of Indian hemp is a constituent of, and gives the green colour to compound tinctures of chloroform and morphine’.

Attempts were made to prevent over-the-counter sale of Chlorodyne in the Australian state of Victoria in 1904, and were met with outrage. When a member of the Victorian parliament proposed that it should be unlawful to dispense narcotic drugs such as opium, morphine, Chlorodyne or cocaine without a doctor’s prescription, he met immediate opposition from country members who complained about the inclusion of Chlorodyne. ‘Why should a man have to ride thirty miles to a medical man in order that he might get a bottle of Chlorodyne which was a drug very commonly used in the country?’ one demanded. Another asserted that ‘Chlorodyne was a very wholesome medicament. Why should he have to pay a guinea for a prescription before he could get it?’

In a similar vein, the Chairman of the Central Board of Health in 1906 was outraged that South Australia’s anti-opium acts had defined opium so loosely that any medical preparation that contained opium or morphine could be included in the ban: ‘The effect of the amending Act was that no officer at any station could give anyone a dose of Dover’s Powder for a cold from the departmental medical chest nor could anyone give a member of his family a single drop of chlorodyne for diarrhoea or dysentery without transgressing the law.’ As this indicates, Chlorodyne was regarded as being so safe that children of that era were regularly dosed with it. Like heroin, Chlorodyne was investigated by the Rolleston committee with the result that its morphine content (the focus of concern, not its cannabis content) was reduced.

Cannabis cigarettes, known variously as Joy’s Cigarettes or Cannadonna cigarettes, were also widely advertised in colonial Australia as a cure for asthma. They were still available after the Second World War but the rise of cannabis prohibition would curtail their use, even though the Director and General of Health, JHL Cumpston, noted that ‘no instance of addiction to them has been brought to notice’ and ‘that they are used for medicinal purposes’.

While cannabis prohibition was sponsored internationally by the governments of South Africa, the United States and Egypt, there was little enthusiasm for cannabis prohibition in either Britain or Australia. Australian drugs policy was based very much on the British system and it was a medical model not a US-style law-enforcement model. Hemp was still grown in Australia and wild hemp crops flourished with official indifference. Cannabis medicines were still widely available and possession of cannabis was not even a crime.


Dr John Jiggens.

“The Origins of Marijuana Prohibition in Australia”, StickyPoint Magazine Issue 05 (2008)
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The Mystery of Nugan Hand Bank and the Murder of Donald Mackay

The murder of Donald Mackay and the mystery of the Nugan Hand bank are two of the enduring riddles of Australian history. But were these two mysteries related? While I was researching the history of the Australian drug trade, I discovered the two mysteries were closely intertwined. Although they both have a Griffith connection what linked them was a ‘Sydney Connection’.

The Sydney Connection was a drug smuggling route that connected the US market for heroin and marijuana to Asia via Australia. It was a transshipment route, organized by US special agents, the US mafia, and Sydney criminals, that came into existence during the Vietnam years, routing the US/Asia drug trade through Australia.

The pioneer of the SE Asia/Sydney/US drug route was a tall, handsome NSW Special Branch detective named John Wesley Egan who was twice recommended for bravery awards for his part in rescues at the Gap. His baby face graced the Sydney afternoon papers. They called him a hero.

Egan’s involvement in heroin smuggling began in 1966 after he joined the political police, the Special Branch, and came via a CIA contact who recruited Egan as a drug courier for an Asian drug army, the Hmong army of warlord Vang Pao, who were fighting a secret war in Laos as a proxy for the CIA against the communist Pathet Lao. Egan made the first trans-Pacific heroin run from Southeast Asia to New York via Sydney in 1966, carrying two kilos of heroin hidden in a specially made corset. Over the next months, Egan made regular flights to New York, taking periodic leave from his police job. Within four months he had exhausted all leave, and he resigned from the NSW police force and moved to New York.

From then on Egan hired other couriers to complete the chain — ‘clear skins’ like himself – usually NSW police officers on leave for the seven-day run. Egan used the ‘shotgun technique’, booking three or more couriers on the same flight, with a ‘supervisor’ riding along to make sure no one absconded. He kept 20 couriers in motion between Sydney and New York. Over a six-month period in 1966-1967, Egan and his gang smuggled $22 million worth of heroin into the USA, before a mistake by a courier led to Egan’s arrest.

Egan’s operation was huge, worth hundreds of million of dollars in today’s terms. This remarkable narcotics ring, composed of NSW police officers led by a Special Branch detective, became known as the ‘Corset Gang’. They were the first major group ever arrested in the United States for smuggling Asian heroin into the US, the pioneers of the Southeast Asia/Sydney/US route. Egan’s operation would leave the NSW police well infected with the germs of the Sydney Connection.

In 1975, a U.S. mobster named Danny Stein visited Sydney to organise the importation of drugs for the U.S. market. The idea, recycled from the Corset Gang, was to use Sydney as a transhipment point for drugs between the Golden Triangle and the U.S. west coast. Amongst the organised crime figures Danny Stein visited in Sydney was another ex-NSW detective called Murray Riley.

Murray Stewart Riley was an ex- detective who became one of the major
criminal entrepreneurs of Sydney. Like John Wesley Egan, Riley was another of the brightest stars of the NSW police, a sporting hero who won two gold rowing medals at consecutive Commonwealth Games at Auckland in 1950 and Vancouver in 1954, partnering future NSW Police Commissioner, Merv Wood. The pair won bronze in sculls at the 1956 Melbourne Olympic Games. Incredibly, Murray Riley became the ‘Mr Big’ of the Australian drug trade in 1976 and, in the same year, Merv Wood became NSW Police Commissioner!

In 1975, Murray Riley met Frank Nugan. In the years that followed, Murray Riley emerged as a major trans-Pacific drug smuggler, while Frank Nugan set up the Nugan Hand Bank, which financed Riley’s drug activities via his Nugan Hand account. The financial arm of this second Sydney Connection was the Nugan Hand Bank and the man at its centre was Frank Nugan.

Frank Nugan was born in Griffith and he and his elder brother Ken went to school with Donald Mackay. By 1977, Frank Nugan was the banker for the Australian drug trade. He lived in Vaucluse in a mansion with its own private beach and he was one of the richest men in Sydney.

It was said about Donald Mackay that he was murdered by the Mr Bigs of the Australian drug trade because he “knew too much” about their activities. Frank Nugan was one of these Mr Bigs.

Did Donald Mackay die because he discovered something that linked Frank Nugan to the drug trade?

What I uncovered was evidence that indicated that this was what happened.

It seems that in these years Australia was growing marijuana for the US market, and acres of cannabis were being farmed in the Riverina region and trucked to Sydney and shipped across the Pacific, entering the US through docks controlled by the San Francisco mafia.

Crime reporter Tony Reeves interviewed a TNT truck driver who told him that in the 1970s he regularly drove shipments down from the Nugan packing shed to the Flemington markets in Sydney. When he turned up at the Nugan packing shed, he would be given money and told to have a meal, and that his truck would be packed for him. He would come back to find the truck packed and the contents locked away behind a new padlock. The same scenario would play itself out at the Sydney markets; he would be given money, told to have a meal, and would come back to find the truck unloaded. Intrigued by this, he checked out the truck and found minute traces of marijuana. The truck driver estimated that his truck fully loaded would hold ten tones of cannabis.

In early 1977, as the newspapers began calling Griffith the ‘pot capital of Australia’, persistent rumours began circulating that the Nugan Group’s packing plant in Griffith was somehow involved. That year, an independent audit turned up secret accounts in the Nugan Group’s books in the names of local pot growers with cheques for hundreds of thousands of dollars made out to members of the Trimboli and Sergi families. Members of these families were heavily involved in Griffith’s marijuana trade, and family members were involved with a one acre plot of pot at Hanwood near Griffith in February 1974, with a thirty-one acre pot plantation at Coleambally in 1975. The secret accounts in their names suggest that some of the pot was being grown for Frank Nugan.

The gangster tactics that Frank Nugan used to hush up the affair provide further corroboration. When the auditors and independent directors of the Nugan Group tried to find out more, Frank Nugan responded by seeking to remove the auditors, and by ‘intimidating’ the opposition directors.

The intimidation was impressive.

The man Frank Nugan hired as his private investigator was Fred Krahe, an ex- NSW detective whose reputation as an underworld enforcer and hit man earned him the nickname of the ‘Killer Cop’. InThe Prince and The Premier, David Hickie called Krahe the “King of crooked police during the Askin era, he organised the abortion rackets, armed hold-ups, the framing of criminals and bribery payments among prostitutes and the police, and he maintained a reputation feared in the Sydney underworld”.

In July 1977, Frank Nugan possessed both the motive for the murder of Donald Mackay and the likely murder weapon, Fred Krahe. Although he was not the grower for Euston or Coleambally, Frank Nugan was the man who paid the growers. The second Sydney Connection, which he fronted, had access to the U.S. market; they were the only network in Australia which could move such a large quantity of pot. Together the two crops, Euston and Coleambally, would have produced about 90 tones of pot according to NSW police estimation, worth approximately $90 million in 1977 dollars or about $1,000,000,000  in 1998 terms.

In July 1977, two weeks before the murder, the crisis over the secret accounts
came to a head when the auditors refused to complete the Nugan Group accounts for the financial year. Donald Mackay became aware of this scandal in the last week of his life. According to Mackay’s solicitor and friend, Ian Salmon, Mackay talked about the affair with him. However, because Ken Nugan, the manager of the Nugan packing shed was an associate and fellow member of the Liberal Party, Mackay was reluctant to become involved.

Griffith locals believed that Donald Mackay was killed because he ‘knew too much’.

The affair of the Nugan Group’s secret accounts suggests that shortly after the secret accounts at the Nugan Group became a public scandal (when the auditors refused to complete the company’s books in the first weeks of July 1977), someone like the truck driver who contacted Tony Reeves, suspected that marijuana growing might be the explanation behind the secret accounts went to Donald Mackay with this information. But Fred Krahe or Frank Nugan learned of this.

Frank Nugan had many reasons to kill to prevent exposure, and in Fred Krahe he had the perfect assassin. Up until this point, Donald Mackay knew only the growers in their grass castles. Now he had a clue that led to the man with the mansion in Vaucluse. As many suspected, Mackay was murdered to protect the financiers and distributors, those higher up the chain of this enormous drug smuggling network. Frank Nugan was that man.

Dr John Jiggens.

“The Mystery of Nugan Hand Bank: The Murder of Don Mackay” (part 3 of 3),
StickyPoint Magazine Issue 04 (2008)
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