Krahe allegedly did work for the infamous Sydney-based Nugan Hand Bank as a private investigator, assisting the bank in covering their fraudulent business activities and money laundering connected to Asian drug trade and the CIA. The massive investigation into the murder of anti-drug activist Donald Mackay led to investigations of cash payouts from the family-run Nugan Fruit Company to local Griffith Mafia figures Antonio Sergi and Robert Trimbole. Bank head Frank Nugan and his brother Ken Nugan attempted to explain away the payments as nothing, but the fruit company's insurance underwriters were minority shareholders who grew suspicious, and hired an independent auditor to investigate. Frank Nugan reportedly hired Fred Krahe in 1977 to intimidate members of the Nugan Fruit Company board of directors, who, though unable to identify the names 'Sergi' and 'Trimbole', suspected that the money had essentially been embezzled. An MP, John Dowd, revealed that the auditors had "been subjected to personal pressure. Certain persons have called at their homes, and the circumstances of the visits are such as to raise the greatest concern among the citizens of the state and the attorney general." The bank (and allegedly Krahe) were unsuccessful in forcing the auditors' resignations.