A senior bikie turned sex worker allegedly had his car "blown up" in an insurance fraud designed to help him pay part of a drug debt he owed his gang's leader.
But a court has been told Alexander Miller's apparent plan unravelled when ACT police seized the payout and he was locked up on drugs charges.
According to investigators, this led alleged Nomads national president Micheal Clark to blackmail Mr Miller's former girlfriend for the cash while holding her jewellery in his bedroom as "collateral".
Mr Clark was granted bail in the ACT Magistrates Court on Tuesday after pleading not guilty to four charges, which include blackmail and receiving stolen property.
The Canberra Times can now reveal details of the alleged offences after obtaining court documents that outline the police allegations.
Police claim in the documents that Mr Miller, while serving as the Canberra Nomads' sergeant-at-arms, sold illicit drugs supplied by Mr Clark and gave the 35-year-old Kingston resident half of the profits.
According to investigators, Mr Miller bought himself a BMW in November last year but registered and insured it in his then-girlfriend's name "to avoid its seizure should he be arrested".
Around the same time, he allegedly told the woman that drugs had been stolen from his car and that he owed Mr Clark $60,000 as a result.
"Mr Miller told [his then-girlfriend] that because the BMW was insured, he would arrange to have it blown up and claim the insurance to pay back [Mr Clark]," police say.
Mr Miller is alleged to have subsequently phoned his then-girlfriend on Boxing Day last year, telling her the car had been "destroyed by fire" and that he needed her to make an insurance claim.
The woman made the claim "under duress", according to police, and received a payout of nearly $22,000.
Investigators say she then withdrew $20,000 on January 10 and gave it to Mr Miller, only for him to be caught with drugs the same day by police who seized about $31,000 from him as suspected proceeds of crime.
When Mr Miller subsequently appeared in court, he presented evidence that he had registered as a sex worker and claimed the cash was a combination of the insurance payout and legally obtained income.
Nearly two months later, while Mr Miller was behind bars on remand, police allege that two people stole a lengthy list of items from the Gungahlin home of his then-girlfriend.
These included her mother's wedding ring and several other items of jewellery, as well as passports, a television and Nomads paraphernalia, the latter of which apparently belonged to Mr Miller.
The woman reported the burglary to police, and officers say she admitted to them that Mr Miller had deliberately set fire to the BMW in order to commit insurance fraud.
"She openly acknowledges that the insurance payout is the proceeds of crime and neither she or Mr Miller had any lawful basis on which to seek its return," police allege in court documents.
According to investigators, the woman broke up with Mr Miller after the March burglary and made repeated efforts to find her jewellery.
They say she discovered where it was in June, when Mr Clark allegedly told her it was in his safe and that he would be keeping it "until the money got sorted out".
"This comment confirmed to [the woman] that [Mr Clark] was blackmailing her and using her family's jewellery as collateral for Mr Miller's debt," police allege.
When Mr Clark was arrested on a NSW warrant in August, police searched his unit and allegedly found a large number of the items reported stolen by Mr Miller's ex-girlfriend.
The 35-year-old, who says he has retired from the Nomads despite police claims to the contrary, is now fighting several charges in both NSW and the ACT.
He was granted bail in both jurisdictions earlier this week, and is due to return to court next year.