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Tracking The Sackler Family's Hidden Assets

Sep 18, 2019
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AUDIE CORNISH, HOST:

The maker of OxyContin has declared bankruptcy as part of a tentative settlement with many local governments over the painkiller's role in the opioid crisis. Now the family behind the company is still very rich. Some attorneys general rejecting the settlement insist that the family spend billions of its personal fortune. Pennsylvania AG Josh Shapiro is one of them.

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JOSH SHAPIRO: I want to see two things from the Sackler family - number one, an acceptance of responsibility for their role in this epidemic here in Pennsylvania and across the country. And I want to see them dip into their billionaire pockets and take out some of those ill-gotten gains and deliver them back to the people who are most in need.

CORNISH: But how would he do that? Well, for insight we turn to Chris Redmond, a lawyer in Kansas City. He specializes in asset recovery. Welcome to the program.

CHRIS REDMOND: Thank you.

CORNISH: Now the Sackler's wealth is estimated to run at $13 to $16 billion. Can you start with how investigators even know that some of it has been squirreled away? What's the paper trail?

REDMOND: Paper trail normally is the relative bank accounts. In this case, it'd be Purdue Pharma. And you would go to the bank accounts in regard to that company, and then trace the funds out, especially any transfers to the Sackler family.

CORNISH: Right, I understand that there were several times it's been reported that the Sackler family board members effectively voted to pay themselves. So that was one way of moving money out of the company.

REDMOND: And that in these kind of situations, if there's diversion of funds and transfer of funds to overseas jurisdictions, that occurs especially once the company starts realizing it has financial troubles.

CORNISH: So there are two ways this could go, right? The Sacklers could decide, hey, we're going to turn over the funds. Or it could be a fight. Let's start with what could happen if the Sacklers were to turn over the funds or even file for bankruptcy. What would that process look like?

REDMOND: Generally, parties who have very substantial funds overseas normally just don't turn funds over. They normally negotiate and try to turn over a portion of the funds, so they try to maintain certain wealth for themselves. The key in those situations is making sure that you obtain full and complete financial information of what their total assets are to make sure the settlement is reasonable.

CORNISH: Now let's say there's no cooperation. They're essentially fighting it, and someone like you is brought in to look for this money. Where do you start?

REDMOND: I start by obtaining all the bank account information from both the company's accounts and from their personal accounts, and then trace any transfers that occurred to determine where they're located and through what entities they've been - may have been laundered as part of the process.

CORNISH: Is that the big challenge, just pinning down where this money ended up?

REDMOND: It usually is a challenge from the standpoint that the initial transfers are not normally where the funds end up. In some cases, you may have 100 transfers to different jurisdictions through different entities. So it can be challenging.

CORNISH: Did you just say 100?

REDMOND: Yes, I did.

CORNISH: Is that common? So people could be - they just keep moving the money around.

REDMOND: I had one case where there were 140 different transfers through different organizations in different countries.

CORNISH: As someone who does this work, when you hear an AG say we're going to go after their wealth and get it, do you laugh? Do you think the Sacklers should be worried?

REDMOND: There's a lot of precedent that has been established over the years. So the last 15, 20 years, certainly a lot of case law has been established to help this process. And it's much easier to hide $100,000 than it is to hide the billion. It becomes difficult trying to hide transfers of moneys in those amounts.

CORNISH: Even if you move it around 100 times?

REDMOND: Even if you move around 100 times.

CORNISH: Chris Redmond is a lawyer who specializes in tracing and recovering hidden assets. Thanks so much for talking with us.

REDMOND: Thank you.

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