It wasn't until the company collapsed into insolvency six months later, that the warehouse doors were opened to reveal a potential health and environmental disaster on Melbourne's suburban fringe: pallets of steel drums and plastic tubs, stacked to the ceiling, filled with mercury, contaminated powders, leaking batteries, and suspected X-ray machine parts. Almost 800 containers of highly toxic material, abandoned by a company that no longer operated.

EPA officers with abandoned steel drums containing toxic material found in a warehouse in the northern Melbourne suburb of Campbellfield. Photo: Supplied

Melbourne's waste and recycling industry is rife with shady deals and shocking environmental damage - infiltrated by cowboy operators and organised-crime figures attracted by easy money and lax enforcement of regulations.

In most cases, landlords or local councils are forced to clean up the mess.

The Campbellfield site was occupied by CMA Ecocycle, which was placed into insolvency but is now owned by an unrelated business that uses the same name. The new owners voluntarily helped cover the cost of recycling the mercury in the warehouse, which reduced the estimated clean-up bill from more than $1 million.

"CMA was a well-known operator in the area, so we didn't think we'd have any problems," said Lili Sandiford, a member of the family that owns the warehouse.

"The Environmental Protection Agency says we were responsible because it's our land. The whole thing has turned into a nightmare," said Ms Sandiford, who was forced to pay the $330,000 cost of removal and remediation.

The Campbellfield drums were filled with mercury, contaminated powders, leaking batteries and suspected X-ray machine parts. Photo: Supplied

Grant Musgrove, chief executive of the Australian Council of Recycling, says waste management has long attracted unscrupulous operators since the mafia imposed itself on the industry in Chicago and New York in the 1960s.

"People make waste go away and charge a fee for it. It's a very profitable business model," Mr Musgrove said. "It's a well-established business model for organised crime."

This has led to industrial estates and vacant land in the city's outer suburbs and in rural areas becoming illegal dumping grounds.

Warehouses have been filled to the rafters with toxic rubbish; properties the size of the MCG are piled with tens of thousands of tonnes of building debris; factories and fields store toxic waste such asasbestos.

The EPA says council areas such as Hume, Brimbank, Wyndham and Manningham are favoured "hotspots" for the illegal dumping of construction and demolition waste.

Among skip-bin operators, dumping is so widespread the EPA now simply warns the public to beware of companies that offer suspiciously cheap prices.

"You only have to catch the train up to Bendigo and you can see it, all the waste that's been dumped off the back of a trailer," said Andrew Tytherleigh, executive officer at the Victorian Waste Management Association.

"Over the years there's been anecdotal evidence that a group of them operate outside of the law - they are the mice and rats of the industry."

How illegal dumping turns a profit

The scam is simple, lucrative and extremely difficult to stop.

Cowboy operators offer services for skip-bins, disposal, sorting or recycling at below-market rates, undercutting the cost of legitimate and licensed businesses.

The waste is stockpiled or dumped on rented properties or public land in the outer suburbs or regional areas.

"The operator can disappear, but the landowner can't. So they are often left holding the baby," says one council waste officer.

And, given the heavy commercial and industrial activity in these kind of commercial areas, it doesn't have to be done in the dead of night.

Last year, after word spread that a new "recycling centre" had opened in Thomastown offering discount rates, heavy trucks loaded with debris from building sites began arriving from around the city.

An abandoned warehouse in Thomastown that is completely full of rubbish. Photo: Joe Armao

But very little of the material that went into the facility leased by Moon Transport ever came out.

"It was a seven-day-a-week operation," said the landlord, who asked not to be named. "It was very fast, very professionally done."

In just three months, the operators had allegedly stockpiled an estimated 30,000 tonnes of rubbish, bulldozing it into massive mounds on the sprawling industrial property, as well as filling an on-site warehouse and a series of shipping containers.

"If I hadn't seen what was happening and stopped them myself, the entire place would have been filled," the landlord said.

Moon Transport manager Ibrahim Ibrahim disputes this account, saying he was not given an opportunity to properly set up the business before he was locked out in early 2016.

"You have to have a lot of quantity to cover the cost. Of course we're dumping a lot of material. After we [would] rent the machine [to sort the waste]," Mr Ibrahim said. "One hundred per cent it was a misunderstanding."

Mr Ibrahim, who has operated a string of waste-related companies, has also been linked to potential dump sites elsewhere in Melbourne and Geelong, although he said incidents on those properties were also due to a misunderstanding with the landlord or misconduct by other parties.

Vasileios Koloutsos is working to clean up the dumped rubbish left on the private property in Thomastown. Photo: Joe Armao

Moon Transport, which is registered in the name of Mr Ibrahim's brother Mahmoud, was used to lease the Thomastown site because Mr Ibrahim's previous waste business was forced into insolvency with debts of nearly $350,000 shortly before he opened the new operation.

The clean-up at the Thomastown property, which involves machine-sorting all the rubbish and collecting any valuable materials for sale, is expected to cost the landlord at least $500,000. If the waste was taken directly to a licensed tip, the bill would likely be more than $2 million.

"What can you do? I'm not allowed to leave it like this. I have to clean it up, then go to court and try to get the money back from Moon Transport," the landlord said.

But taking legal or compliance action requires that there is a business entity that can be pursued by landowners, the council or the EPA.

Many operators dump and run, only to emerge under a new business name elsewhere.

The process is known as "phoenixing" - the corporate entity responsible is abandoned along with the contaminated site, while the operators go on to register a new business that opens at a new location. It makes enforcing fines and clean-up notices extremely difficult.

"Phoenixing is one of the oldest business models," ACOR's Grant Musgrove said.

Bill Patten on land he leased to a Melbourne company he says dumped asbestos-riddled rubbish and walked away. Photo: Justin McManus

One alleged victim is Bill Patten, who leased his Ardeer property to Dirty Harry's bin hire in 2014. The company dumped about 8000 cubic metres of asbestos-riddled rubbish on his property and promptly walked away, he said.

The company had been prosecuted in the courts, Mr Patten said, and multiple clean-up orders had also been issued by the Victorian Civil and Administrative Tribunal and the EPA.

But the director had quickly shut the company down and reopened under a different name, avoiding having to clean up the dump.

"I believe that the worst possible outcome may well become reality, and I will then be held personally responsible for removing the rubbish and asbestos from the property - which I have had costed at an estimated $2 million dollars," Mr Patten said.

Organised crime

The involvement of organised crime groups is an open secret in the waste industry, insiders and experts say.

"It's a well-established business model for organised crime," the Australian Council of Recycling's Grant Musgrove said.

A Middle Eastern crime gang has been dumping asbestos in warehouses and factories in Mill Park, Doreen and Campbellfield for more than two years. Much of the toxic waste comes from its contacts in the construction and demolition industries.

The owner of a large warehouse was recently threatened by the gang, after discovering thousands of used tyres had been dumped on his property and warning he would make a report to the EPA.

Another notorious operator in regional Victoria was planning to fill a trench with asbestos, seal it with earth and conceal it under a stack of commercial waste on rented land, but abandoned the scheme in the midst of a council investigation into his facility.

Last week, Fairfax Media revealed a dispute over control of a northern suburbs rubbish tip had escalated into a physical altercation between two shady figures involved in the deal.

Former biochemist and convicted drug trafficker Shane Charter represented a syndicate buying the Bulla Tip and Quarry from its current owners, who have close links to the Hells Angels outlaw motorcycle gang.

The transaction was complicated by the involvement of gangland figure Fedele D'Amico, who placed a caveat over the property in a bid to thwart the sale.

At a recent meeting at the Bulla Hungry Jacks franchise, attempts to mediate the dispute failed dramatically when Mr D'Amico attacked Mr Charter with a chair.

Bulla Tip and Quarry had previously attracted the scrutiny of EPA officers, when video emerged of asbestos being broken up by an excavator.

In 2015, the EPA uncovered "irregularities in licence approval" at the Bulla tip, which prompted an independent review into landfill licences across the state.

Whose responsibility?

Victoria's waste management framework is extremely complex, with responsibilities split between the EPA and local government.

Typically, the authority deals with high-level waste and waste that poses an imminent threat to the environment. Councils are generally responsible for rubbish that does not pose an environmental risk.

"The system is very complicated and convoluted," EPA chief executive Nial Finegan said.

But ultimately, Mr Finegan is keen to stress, responsibility for what happens on a site goes back to the landowner.

"Under the act, the polluter is responsible. Failing that it falls to the landlord.

"My advice to property owners and the like is they do their due diligence. They have an obligation and a responsibility as to how their property is being used.

"The community should not pick up the bill to clean up your land. Why should the taxpayer pick it up when the person has received a commercial benefit?"

The EPA has received funding from the state government for an Illegal Dumping Strikeforce program, which includes the use of drones to inspect suspected dump sites. In the 2015-16 financial year, the agency inspected 233 suspected sites and issued 98 remedial (or clean-up) notices and 24 penalty infringement notices.

Yet the system is failing to keep up with the problem, judging by the number of illegal dump sites still operating or abandoned around the state.

Brimbank council mayor John Hedditch believes at least 50 illegal dumps are dotted about his shire alone. "It's been a really big problem for us over the years and it continues to be," he said.

The council received about 3500 reports of littering and illegal dumping last year, and spends about $700,000 annually cleaning up the mess.

The ruins of Carlton's illegally demolished Corkman Irish Pub, including asbestos, were found dumped at a construction site in Brimbank owned by the same developer.

"We want legislation strengthened so the book can be thrown at these rogue operators," Cr Hedditch said.

Do you know more? Contact chouston@fairfaxmedia.com.au