New York Attorney General Finds $1 Billion the Sackler Family Allegedly Tried to Shield

By David Boddiger  |  September 14, 2019 | 5:31pm
Healthcare

A settlement tentatively reached this week between scores of
municipal and state governments and Purdue Pharma over the nation’s opioid
crisis hit another snag on Friday when New York’s attorney general announced the discovery of
$1 billion the company’s family owners allegedly transferred to offshore
accounts.

Last month, New York Attorney General Letitia James subpoenaed
33 financial institutions with ties to the Sackler family, owners of Purdue
Pharma, the maker of OxyContin. The subpoenas are tied to James’ effort to
track billions of dollars the family allegedly transferred out of Purdue Pharma
to hide profits before the company declares bankruptcy, The New York Times and other media reported.

The findings announced on Friday come from only
one of the financial institutions that responded to the subpoenas, the Times said.

The attorney general’s office said it found about $1 billion
in wire transfers by the Sackler family, some of which went through Swiss bank
accounts.

“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. The limited number of documents
provided to us so far underscore the necessity for compliance with every
subpoena,” James said in a statement.

Earlier this week, Purdue Pharma had offered to settle
more than 2,000 lawsuits brought against the company for its role in the
opioid crisis, which killed more than 400,000 people nationwide between 1999
and 2017, as Splinter’s Naomi LaChance previously reported.

The New York attorney general’s office also said that
Mortimer Sackler, a former Purdue board member, hid
ownership of a Manhattan townhouse and other real estate through shell corporations, which was
not disclosed in current litigation, according to NBC News.

Referring to the new discovery, the Associated Press wrote:

They point to $20 million shifted from a Purdue parent
company to Sackler, who then redirected substantial amounts to shell companies
that own family homes in Manhattan and the Hamptons. Another $64 million in
transfers to Sackler came from a previously unknown family trust, using a Swiss
account, prosecutors said in their filing.
The filing, made in a New York court, follows decisions by
that state and others to reject a tentative
settlement with Stamford, Connecticut-based Purdue, announced this
week, arguing it does not do enough to make amends for the company’s and
family’s alleged roles in flooding U.S. communities with prescription
painkillers.

A firm representing Mortimer Sackler told the Times that James’ announcement is a “cynical
attempt by a hostile A.G.’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.”

But as NBC News pointed out, support for the settlement is
split mostly along party lines. Republican attorneys general support the
settlement, while Democrats reject it. One exception is Idaho’s Republican
Attorney General Lawrence Wasden, who opposes a deal.

Purdue Pharma is expected to file
for bankruptcy in coming days.

According to the AP, all but two U.S. states, along with 2,000
local governments, have sued Purdue
and other drugmakers. Sixteen states have sued members of the Sackler
family by name.

 
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