New York (CNN)Authorities have identified about $1 billion in wire transfers between the owners of pharmaceutical giant Purdue Pharma, the entities they control and different financial institutions, New York Attorney General Letitia James said Friday.
The discovery of the wire transfers comes as amid growing allegations by New York and other states that the Sackler family is moving billions of dollars offshore to protect their wealth. It also follows news two days ago of a proposed settlement by Purdue Pharma to thousands of states, counties, cities and tribal governments in their ongoing lawsuit accusing the company of fueling the nation's opioid epidemic.
The New York attorney general's office is trying to determine how much money the Sacklers have amassed and where it is. Details about the wire transfers, including some that authorities say were funneled through Swiss bank accounts, were released as part of a new court filing by Attorney General James in the ongoing lawsuit.
"While the Sacklers continue to lowball victims and skirt a responsible settlement, we refuse to allow the family to misuse the courts in an effort to shield their financial misconduct," James said in a written statement. "The limited number of documents provided to us so far underscore the necessity for compliance with every subpoena."
Millions of dollars in wire transfers involving Mortimer D.A. Sackler, a former Purdue board member, were mentioned throughout the new document.
In a statement to CNN, Sackler said "there is nothing newsworthy about these decade-old transfers, which were perfectly legal and appropriate in every respect.
"This is a cynical attempt by a hostile AG's office to generate defamatory headlines to try to torpedo a mutually beneficial settlement that is supported by so many other states and would result in billions of dollars going to communities and individuals across the country that need help," Sackler said.
The Sacklers and Purdue Pharma, which makes OxyContin, have fought to limit discovery and subpoena action by the attorney general's office.
Mark S. Cheffo, an attorney representing Purdue Pharma, said in a September 6 court filing that "Purdue has already produced more than 51 million pages of documents to the state, including voluminous financial and business information"
He also argued the subpoenas should be quashed because they are "premature, facially defective, overbroad and cumulative of (the) discovery Purdue has produced."
But David E. Nachman, a lawyer representing the New York attorney general's office, said in a letter to the court that the records helped officials identify shell companies that a member of the Sackler family used to conceal his wealth.
"Already, these records have allowed the State to identify previously unknown shell companies that one of the Sackler Defendants used to shift Purdue money through accounts around the world and then conceal it in at least two separate multimillion-dollar real estate investments back here in New York, sanitized (until now) of any readily-detectable connections to the Sackler family," Nachman wrote. "Based on this evidence alone, the State anticipates the addition of one or more of these previously-unknown shell entities as defendants directly liable under the State's DCL claims."
Some wire transfers continued through last year, the filing says
Sackler was involved in 137 wire transfers totaling nearly $20 million, and some of those transfers occurred as recently as 2018, the filing indicates.
Sackler received some of those transfers, he redirected "substantial portions of those proceeds" to two other entities that own real estate on his behalf, the document said.
According to the court document, Sackler transferred nearly $40 million to Central Eight Realty LLC, which owns a townhouse in New York on his behalf. A nearly $4 million wire transfer was received by Cherry Tree Holdings LLC, which owns a home in Amagansett, New York on his behalf.
"Because Defendant Mortimer D.A. Sackler has placed these New York real estate holdings in the name of shell companies, their ownership would have been impossible to detect from publicly available records and without access to financial records," state prosecutors said in the filing.
In another transfer, Sackler received $64 million from the newly discovered trust named Purdue Pharma Trust MDAS, and that money was sent through a Swiss Bank account, the document said.
He also received money routed through that same Swiss bank account from the Heatheridge Trust Company Limited, a trustee of a trust belonging to Sackler, according to the court filing.
Friday's filing indicates that it only reflects the initial findings from a single unnamed financial institution's response to the attorney general's subpoena in the case.
The New York attorney general's office identified several previously unknown entities that are "believed to serve as conduits for transfers from Purdue to the Sackler Defendants" based on the documents provided by that unnamed financial institution.
Officials are only identifying it as "Institution A," according to the filing.
