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What you are describing is a internet scam. Please do not send any money. This is a common scam where they say they need the money to get personal items sent back to the States. If there is any way to stop the money from going through please do so. They ask the the money be sent via Western Union so they can reover their possessions. This is considered a Nigerian Internet scam.
This is a link where you can report the Cyber crime: http://www.ic3.gov/default.aspx
Since you are in Australia, this is a link where to report the crim to the Australian Govt. : http://www.afp.gov.au/policing/cybercrime/internet-fraud-and-scams.aspx
This is another link for reporting: http://www.ccmostwanted.com/report/report3.htm
This is from the Army CID about some of the scams that they are encountering that falls into what is happening with you: http://www.army.mil/article/67457/