A Welsh gang which laundered almost �3m in drugs money in a Europe-wide operation was caught out by the British equivalent of the FBI, a court has heard.

Cash paid to the gang for drugs in the Netherlands was allegedly covered up when it was converted into Dutch guilders back in the UK.

Ten people - including five from south Wales - are on trial at Swansea Crown Court after allegedly running the scam like an "international business".

Police made notes on what they saw and notes on what they did

Greg Taylor QC, prosecuting

They were foiled when National Crime Squad experts swooped as the group swopped cocaine-laced bank notes at a Reading motorway service station in October, it was said.

The bust followed months of secret surveillance by the London exchange firm which had unwittingly chanelled the group's cash, helping to cover its origin.

TTT Corporation tipped off police after becoming suspicious, then agreed to work with Britain's crack crime squad to record telephone conversations with the drug dealers.

'Plush hotels'

Paul Jeffreys, 34, and Lucy Kift, 22, of Bryn Road, Llanelli, were the "manager" and "personal assistant" of an operation run like "an international business", it was said.

The couple often stayed at plush London hotels and aboard yachts while holidaying in Spain, but Jeffreys answered to others "in sunnier climes" who were not in court, the jury heard.

Prosecuting, Greg Taylor QC said they had used couriers travelling from the UK to the Netherlands to collect cocaine and ecstasy.

Payment - which reached �2,960,867 - was collected in pounds sterling and converted to guilders back in England.

Some members used up to five mobile phones in an effort to ensure they were not traced, it is claimed.

Actions monitored

"The money was changed into currency in an establishment called the TTT Corporation, which is a legitimate business," Mr Taylor told the court."

But TTT bosses worked with detectives to monitor the gang.

"They made notes on what they saw and notes on what they did, on how the gang operated, what their movements were and how they connected," Mr Taylor added.

He said the jury would see video evidence of the members changing up to �233,000.

High levels of cocaine and ecstasy were allegedly found on notes exchanged for guilders after analysis.

The ten are accused of conspiracy to supply class A drugs and conspiracy to launder money.

Six people have admitted both charges:-

• Paul Jeffreys, 39, and Lucy Kift, 22, of Bryn Road, Llanelli
  
• Steven Summers, 38, of The Mariners, Llanelli
  
• Alan Thomas, 37, of Star Cottage, Pontardawe
  
• Richard Hughes, of Heol Gwanwyn, Llansamlet
  
• Freddy Lawrence, 35, of Woodfield Close, Folkestone

Two men from Folkestone - Trevor Millard, 36, of Woodfield Close, and Jason Flisher, 31, of Fairfax Close - both deny the charges.

And another man from Swansea - who cannot be named for legal reasons - also denies both charges.

The case is scheduled for eight weeks and continues on Thursday.