Newport to Australia : Trial Begins for 3 Accused of Drug Plot

Three men accused of planning to export cocaine from Newport Beach to Australia via the yacht High Roller and to sell it for up to eight times the Southern California price went on trial in federal court Wednesday.

On trial on charges of conspiracy and cocaine possession are Robert A. Aceto, 45, and Eugene W. Foster, 40, both of Newport Beach, and Edward R. Nigro Jr., 38, of Long Beach.

Prosecutors said the plan was novel and designed to return maximum profits. The three are accused of planning extensively for the deal, including an initial air shipment of several kilograms to pay for outfitting the 46-foot racing yacht, docked in Newport Bay, and other advance costs. According to federal charges, the three planned to ship 100 kilograms of cocaine.

Special Undercover Agent

One of the initial partners was a drug dealer called “Hugo”--who in fact was Serge S. Duarte, a Customs Service special agent operating undercover.

Foster, a part owner of the High Roller, first suggested the export idea, Duarte testified Wednesday before U.S. District Judge Alicemarie H. Stotler.

Foster “said that cocaine sells for as low as $10,500 per kilogram in the United States, but it can sell for $60,000 to $80,000 per kilogram in Australia,” Duarte testified. “There was a large amount of profit to be gained by doing that.”

A tape recording played for the federal jury Wednesday of one alleged bargaining session between Foster and Duarte made repeated references to “parcels” and “contracts,” standard references in the drug world to kilograms, Duarte testified.

Duarte was supposed to provide 2 kilograms of cocaine for the initial run to Australia, according to his testimony. The quantity was to be matched by a supplier working with Foster.

In the recording, Duarte insisted on collateral from Foster to secure the value of his initial investment.

They agreed that Foster would give Duarte the deed to property he owned, pending payment of profits, according to the tape.

Shortly after the conversation, on Jan. 8, Foster was arrested and agreed to help investigators find his cocaine supplier. Aceto and Charles M. Anderson, who has pleaded guilty to a single charge in the case, were arrested the same day in Newport Beach.

Anderson then agreed to help investigators. In other taped conversations, Nigro agreed to deliver 8 kilograms at a Newport Beach hotel, according to Assistant U.S. Atty. Thomas J. Umberg.

Nigro, who had previously been convicted of distribution of marijuana, was arrested on suspicion of placing a parcel containing cocaine in a car parked in the hotel lot.

After Nigro’s arrest, agents searched Foster’s home and found scuba tanks fitted with hidden storage compartments in his garage, according to court records.

According to prosecutors, Aceto was the skipper of the High Roller and lived aboard it.

The yacht was once sailed by Dennis Conner, the 1987 America’s Cup winner, Duarte said.