The southside drug dealer initially won when he beat a money laundering rap in the ACT Supreme Court, claiming that hundreds of thousands of dollars in cash had come from counting cards.

But prosecutors soon found a hole in his story and seized the $397,355 found hidden in his Phillip home.

Police found cash, 4.355 grams of heroin, and other drug paraphernalia during the raid in June last year.

A digital safe hidden under the house contained $377,905 in cash, $19,430 was located on the kitchen table, and Song had $1035 and some small bags of heroin in the pants he had been wearing at the time of his arrest.

Song was charged with trafficking heroin and dealing in proceeds of crime.

He pleaded guilty to selling two shots of heroin for $160 in June last year, but argued the $398,370 had come from savings and gambling.

During the trial, the court heard Song had a heavy heroin habit, regularly using two to three grams per day and taking up to eight shots on a bad day.

Song claimed he had not dealt drugs, but rather had been part of a buyers syndicate, whereby a group of about seven users pooled cash in order to buy heroin in bulk at a cheaper price.

He said the prosecution's allegations of him selling heroin had actually been him dividing the shares of the pooling agreement.

In evidence, Song told the court about $100,000-$150,000 of the cash uncovered had come from work savings stretching back to about 2002 when he first moved to Canberra.

He claimed the rest of the money in the safe came from gambling on blackjack in casinos as he could count cards.

When asked why he did not deposit the money into the bank, he replied he was "a bit funny about banks".

While unimpressed with Song's explanation, Justice David Mossop in June acquitted Song of dealing in the proceeds of crime as the prosecution had not proven its case beyond reasonable doubt.

Mr Mossop said the court had not heard evidence to contradict the claims and Song's cross-examination had not demonstrated his claims should be rejected beyond a reasonable doubt.

"While the explanation of the defendant is implausible and the collective circumstances strongly supportive of the Crown case, I am not satisfied beyond a reasonable doubt that the total amount particularised, namely $398,370, was the proceeds of crime," Mr Mossop said in his decision.

"Although the evidence that he gave about winning money from gambling was given with a level of imprecision and lack of detail which reduced the weight that it might be given, the challenge to the gambling claim was not sufficient to demonstrate beyond reasonable doubt that it was not correct.

"Further I am not satisfied beyond reasonable doubt that any lesser amount being part of that total amount was the proceeds of crime, even though there must be grave suspicions about its source.

"Therefore the defendant must be acquitted on this count."

However, after his acquittal, police contacted the casinos and discovered there was no evidence to show Song had visited the gambling venues and won the money as claimed.

Prosecutors used the new evidence in an application in the ACT Supreme Court under Confiscation of Criminal Assets laws.

Song did not contest the civil case and Associate Justice Verity McWilliam ordered last month the $397,335 be forfeited to the ACT.