Detectives searched an industrial estate in Londsdale where they said the missing father escaped before being tracked down and killed.
“He was held at this location, we definitely think he was,” Detective Brett Featherby said.
“He escaped from this area and after that escape he was killed about two weeks later.”
Police found several items at the scene, including a firearm, a taser, a hydroponic cannabis crop, and three shipping containers of illegal fireworks.
“We know that this property is frequented by low-level drug users and low-level drug dealers,” Featherby said.
Mundy went missing nearly two years ago and police believe he is one of three men allegedly killed by a drug ring.
He was last seen on CCTV at a pharmacy in the Colonnades mall.
The body of the 36-year-old father has not yet been found.
Featherby said detectives believe several people were involved in Mundy’s alleged murder and the disposal of his body and that multiple suspects may have been involved in those roles.
Major crime detectives are investigating the possible involvement of members of drug syndicates in the suburbs of Lonsdale, Aldinga and Sellicks Beach, and their role in Mundy’s murder and disappearance.
Police reiterated that there is a $200,000 reward for any information leading to convictions of the alleged murder or the recovery of his body.
According to the police, further rewards will be sought if more murders are found.
The disappearance of Adelaide man Robert Atkins and the death of Trevor King were also the focus of the investigation.
King’s body was found in West Lakes in January 2020.
Police involved with Taskforce Southern have so far conducted 62 house searches and arrested 27 people on 95 charges.
The charges include blackmail, assault, unlawful detention, firearms, crimes, money laundering, theft and interference in the case and witnesses.
No one has been arrested for murder.