Attorney General Kathy Jennings announced Friday that the state Justice Departments Fraud Division has secured revocations of the corporate charters or certificates of formation of multiple Delaware-registered business entities connected to criminal entities, including a Venezuelan cartel and a federally sanctioned online pharmacy based in Argentina.
“Delaware’s central role in the business community is both a privilege and a responsibility,” said Attorney General Jennings. “It is incumbent on all of us to protect it from abuse and to ensure that our state’s business entities are not exploited as instruments of criminal enterprise. I’m grateful to OFAC for its excellent partnership and to the Fraud Division for its aggressive pursuit of these complex but deeply important cases.”
Delaware has increased scrutiny on corporate entities that under state corporate charter law require little information on their purpose or owners. Incorporations are a major source of revenue for Delaware.
Following a November 22 hearing, the Delaware Court of Chancery canceled the corporate charter of Water Hill Corp., SMILEPAYMENTS LLC, and SMILE TECHNOLOGIES S.A. LLC. Two remaining entities — Oyster Investments LLC and 200G PSA Holdings LLC— are awaiting revocation pending liquidation and dispersal of their assets.
The three canceled entities and Oyster Investments LLC are linked with an online pharmacy, Goldpharma, which has been sanctioned by the U.S. Department of the Treasury’s Office of Foreign Asset Control (OFAC) and whose operators have been federally indicted. The business entities in question were used to launder money associated with Goldpharma’s illicit trafficking of commonly abused pharmaceuticals — including Tramadol, Alprazolam, Carisoprodol, Diazepam, Codeine, and Tapentadol — into the United States.
The fifth entity, 200G PSA Holdings, LLC, is associated with the Cartel of the Suns, an organization believed to be comprised of upper-echelon members of the Venezuelan armed forces which trafficked cocaine into Mexico and the United States on behalf of the Revolutionary Armed Forces of Colombia (FARC).
Assets held by the two pending entities include, in the case of Oyster Investments LLC, several beachfront properties in Florida with an estimated value of $1 million to $1.5 million; and, in the case of 200G PSA Holdings LLC, a private airplane.
This matter was led for the DOJ by Deputy Attorney General Oliver Cleary, with support from Paralegal Courtney Patas and oversight by Director of Impact Litigation Christian Douglas Wright. It follows an investigation led by OFAC. OFAC and the Delaware DOJ share a longstanding partnership in the fight against criminal business entities, and entered a memorandum of understanding (MOU) to further facilitate their collaboration in September 2020.
Click here for an earlier story on the entities mentioned above.
