An alleged plot by a suspected Chinese spy and a Russian-born Brisbane businessman to smuggle military equipment has been uncovered by the Australian Federal Police.
Brisbane entrepreneur Alexander Cher, 63, is accused of partnering with Chinese national and former Melbourne businessman Brian Chen to circumvent Australian laws that prohibit the export of military items without federal government approval.
Alleged Chinese intelligence operative Brian Chen.
A major investigation by this masthead and 60 Minutes in 2019 revealed Mr Chen as a suspected Chinese military intelligence operative who had allegedly sought to infiltrate Australia’s parliament. However, the federal police probe is limited to accusations of a plot to illegally broker the supply of defence goods.
Official sources not authorised to comment publicly said Mr Cher, who has run a string of companies in Queensland and NSW, has been the subject of an intensive federal police investigation and was charged last week by detectives and released on bail after a short court appearance.
According to court documents, a second Queensland man, Kim Bowei Lee, has also been charged in connection to the alleged plot and released on bail.
The federal police have also issued an Interpol red notice for Brian Chen, who is a director and shareholder in several companies with deep ties to the Chinese military procurement industry.
In a statement, the federal police confirmed that a “64-year-old Gold Coast man and a 63-year-old Brisbane man have been charged with arranging to supply goods” that are named on the Defence and Strategic Goods List. This means their export without a permit may be in breach of the Defence Trade Control Act 2012.
“An arrest warrant has also been issued for a 59-year-old Chinese national, currently believed to be residing overseas,” the statement confirmed.
When called for comment, Mr Cher said : “I can’t talk now. Call me later.”
According to business and property records, Mr Cher’s first venture in Australia was an agriculture company he founded in Bronte in 1996. Back then, the Southern Russian émigré was known as Alexander Tcherekezov. In the late 1990s, he moved to Queensland, shortened his name to Alex Cher and launched a string of companies in the property, construction and maritime sector part-financed by businessmen from Russia and Ukraine. Mr Cher was also a federal government-licensed migration agent, running a business called Nita International that helped Russians get visas or residency in Australia.
In 2003, he purchased a waterside two-storey home in the Gold Coast suburb of Benowa, moving to a five bedroom inner-city Brisbane house in 2017.
Mr Chen was the first suspected Chinese intelligence operative to be unmasked in Australia.
Previously based in Melbourne, Mr Chen was the subject of a 2019 investigation by The Age, Sydney Morning Herald and 60 Minutes that revealed allegations he was working for Chinese military intelligence and had deep business interests with Chinese government-owned arms and defence technology firms. The reports also detailed how an ASIO informant also alleged that Mr Chen sought to plant an operative in Federal Parliament.
The arms and defence technology trade in China has for years been controlled by the Chinese military, either via state-owned companies or ostensibly private firms controlled by defence officials.
A similar dynamic exists in Russia, with estimates more than two thirds of the country’s arms trade is controlled by the state and used as a tool of foreign policy.
More broadly, Russia is also forging far closer ties with China as the West ramps up sanctions and other diplomatic pressure over Russia’s aggression towards Ukraine.
On February 4, Russian President Vladimir Putin travelled to Beijing for the Winter Olympics and engaged in significant discussions with Chinese President Xi Jinping.
While the arms trade often is propelled by political or foreign policy agendas, it also can be a lucrative business.
In 2011, Australian and US agencies identified a plot involving Chinese intelligence officials who had sought the help of a Sydney crime figure to smuggle weapons to Iran and Lebanon.
The suspected deal was organised in Sydney and Hong Kong and involved the supply of small arms by Chinese state-owned defence company Norinco, but lead to no charges.
Mr Chen became the subject of intense media scrutiny in late 2019 after reports in this masthead that he was the subject of an ASIO inquiry over allegations he attempted to recruit Liberal Party member Nick Zhao. Mr Zhao died last March after alerting ASIO that Mr Chen allegedly offered him $1 million if he ran for a seat in Federal Parliament. There is no suggestion that Mr Chen was involved in Mr Zhao’s death, and the Victorian Coroner ruled the death did not involve foul play.
Mr Chen was interrogated by ASIO officers at Melbourne Airport in March 2019 but has not returned to Australia. In an interview with this masthead in 2019, Mr Chen denied any links to Chinese military intelligence, insisting he was merely a businessman.
However, analysis by officials of Mr Chen’s communications devices, travel and immigration records by authorities revealed he adopted multiple identities, including as a paint brush manufacturing manager, military vehicle manufacturer and Hong Kong journalist. Business records from Hong Kong and mainland China show Mr Chen also formed joint ventures with a subsidiary of Chinese military manufacturer Norinco.
Mr Chen used the accreditation provided by the state-owned newspaper China Times to attend the Trump-Kim summit in 2018. Sources with knowledge of investigations into Mr Chen said Western security officials had uncovered photos of Mr Chen at the summit, though they were unable to determine why he was there.
Mr Chen also tried to buy laboratory space at Australia’s science agency, the CSIRO, and he has connections to figures involved in China’s acquisition of an aircraft carrier from Ukraine. Among his collection of photos are pictures of him on Chinese naval vessels and, according to Mr Chen himself, meeting the Hong Kong businessman Xu Zengping who teamed with the Chinese military to acquire China’s first aircraft carrier from Ukraine.
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