ICE Seizes Oil Company, Wells

Shown above is one of the 43 active oil wells in Pennsylvania seized by ICE agents as part of the continuing investigation into convicted marijuana smuggler Paul Hindelang.

ICE Photo

In what may be a first for federal law enforcement, ICE has seized a U.S. oil company and its 43 oil wells in Pennsylvania in an ongoing money laundering investigation.

ICE Special Agent-in-Charge for Miami Jesus Torres and Col. Rick Ramsay, Under Sheriff of the Monroe County, Fla. Sheriff’s Office, announced the seizure January 22. The assets, which also include numerous trusts and bank accounts in Europe, are valued at roughly $6.5 million, bringing the total amount seized in this ongoing money laundering investigation to more than $70 million.

On January 21, ICE agents seized Shaboom Oil, Inc., its 43 operating oil wells and the mineral rights to approximately 1,100 acres of land in the Allegheny National Forest in northwest Pennsylvania. ICE agents also seized a Panama-based investment company that owns Shaboom Oil. In the principality of Monaco, ICE agents seized assets in numerous trusts and bank accounts.

The oil company, its oil fields and the other assets have all been linked to Paul Edward Hindelang, who operated one of the nation’s largest marijuana smuggling operations in the late 1970s. In 1981, Hindelang pled guilty to importing roughly 250 tons of marijuana, and conspiring to import an additional 150,000 pounds of marijuana into Florida, Louisiana and other U.S. locations. As part of his plea agreement, Hindelang agreed to forfeit $640,000 to U.S. authorities, asserting this amount represented all his illegally earned assets.

Several years later, ICE agents learned that Hindelang had hidden away millions of dollars worth of drug funds in overseas accounts. Working together with the Monroe County Sheriff’s Office, ICE launched “Operation Cash Extraction” in 1992 to track down Hindelang’s hidden funds. After years of investigative work, agents found many of his assets in a maze of offshore accounts and corporations in Switzerland, Panama, the Turks and Caicos Islands, the Netherlands Antilles, the Cayman Islands and other locations.

In 1998, ICE agents seized $50 million from accounts tied to Hindelang. The agents continued their search and, in 1999, located additional drug proceeds in bank accounts in the Channel Islands (in Jersey and Guernsey) and invested in a property in Colorado. ICE agents launched forfeiture proceedings and were ultimately able to recover approximately $15 million in assets that constituted illicit proceeds of drug sales.

Last year, further investigation by ICE and the Monroe County Sheriff’s Office turned up an additional $6.5 million worth of illicit assets in Monaco and the United States. The investigation into Hindelang’s drug funds continues.