Corporate Transparency Act

Virtual Realty

The phone number for Land and Apartments LLC sports a 314 Area Code, giving apartment hunters the perception they are calling a local real estate office. Instead, they’re being patched into the amorphous world of the Internet, where cloud-based communications are a tad more hazy.     

Bad sign: After tenants began asking questions about the interior demolition of a Richmond Heights apartment building, Land and Apartments belatedly incorporated.

If you’re interested in renting an apartment in St. Louis from Land and Apartments LLC, the real estate investment firm’s phone number is 314-800-0424. When you call that sequence of numbers, a pleasant recorded voice will greet you and politely ask you to leave a message.

Land and Apartments may be in the business of renting brick and mortar properties, but its phone number isn’t tied directly to the company’s physical office. In many respects, the concept of a tangible business address is an anachronism, a quaint idea leftover from the 20th Century.  Nowadays, a disembodied, anonymous voice in the nebulous ether asks you to provide personal information and says: “Your call will be returned as soon as possible.”

Welcome to the virtual world of Voice Operated Internet Protocol.

This technological innovation allows companies to create the appearance of being a neighborly business by using a local Area Code. In reality, the corporation could be located around the corner or around the world. There is no way of knowing for sure. It’s the same technology used by Skype and Google Talk. But in this particular VOIP application, phone numbers — including geographically-based Area Codes — are bought and sold for use over the Internet by various kinds of businesses, including the phone sex trade.

Three different online reverse phone directory searches indicate that 314-800-0424 belongs “B. Honey,” who apparently used the phone number in the past. One of the reverse phone directories lists B Honey as living in Kansas City even though the 314 Area Code is associated with St. Louis. Wherever B Honey is located, it’s a safe bet the name has nothing to do with an aviary.

Sharing the same phone number with the enigmatic “B. Honey” of Kansas City may be nothing more than a fluke, but the coincidental ties to Kansas City don’t stop there.

Last name first: Honey, B

In another simple twist of fate, the organizer of Land and Apartments LLC is listed by the Missouri Secretary of State’s Office as attorney Rex A. Redlingshafer, a partner in the Kansas City branch of the Dentons law firm. Redlingshafer is the nephew and cousin of James Ryan Redlingshafer Sr. and Jr., owners of Artemis Holdings LLC.

Artemis Holdings and Land and Apartments are both involved in the controversial redevelopment of a Richmond Heights apartment building that gained media attention last month, after the companies were cited for violations of the law by municipal and county agencies. Tenants complained to  Richmond Heights and St. Louis County Public Health Department officials about conditions inside the building during its demolition. As a result, occupants were forced to move during the pandemic, including two who were more than 80 years old. Richmond Heights fined Artemis Holdings for not initially applying for a building permit and the health department issued a formal Notice of Violation for skirting a federal environmental law pertaining to asbestos testing.

The building code and environmental law violations occurred prior to Dentons filing incorporation records for Land and Apartments on Oct. 9. It is not known whether Connor O’Leary, who appears to represent both companies, is the owner of Land and Apartments. O’Leary is affiliated with a third limited liability corporation, Central Investments LLC, which is located on the second floor above the Cut N Dye Hair Salon at 1051 S. Big Bend Blvd. in Richmond Heights.

State incorporation laws still shield the owners of limited liability corporations from being identified. However, the passage of the Corporate Transparency Act earlier this month should eliminate this loophole eventually. But for now LLCs continue to operate under the cloak of anonymity nationwide. Beginning with the leak of the Panama Papers in 2016, byzantine networks of limited liability corporations have been the subject of investigations that have uncovered how such shell companies are used by the wealthy to secretly acquire real estate, hide assets, and avoid taxes. The Caribbean is one of the favorite locations used for off-shore activities, including Barbados — where Dentons — the world’s largest law firm, has a presence.

South of the Border

This residential property at 5844 Marquita Ave. in Dallas is the registered address for AKR Ventures STL LLC and RedRose Capital LLC. Incorporation records tie both companies to James Ryan Redlingshafer Jr. of St. Louis and Phillip A. Rose, son of retired BNSF Railroad exec Matthew K. Rose.

One degree of separation: A Texas financier, with a stake in a controversial Mexican gold mine, is hooked up with St. Louis real estate baron James Ryan Redlingshafer Jr.    

The Mexican government’s Financial Intelligence Unit (UIF)  investigated a Dallas-based gold-mining company for alleged money laundering, according to a newspaper report in the Spanish language press published earlier this year. A director of that company is a business associate of St. Louis real estate investor James Ryan Redlingshafer Jr.

Redlingshafer, who resides in University City, is the organizer of St. Louis-based Artemis Holdings LLC with his father, James Ryan Redlingshafer Sr. That company received local media coverage last month for its violations of municipal and county laws related to demolition work on a Richmond Heights apartment building.

Though more far-flung, Redlingshafer Jr.’s other real estate ventures have garnered less attention, including the joint directorship and management of two Texas corporations with Phillip A. Rose of Westlake, Texas.

The range of Rose’s business activities is even wider. His diverse interests include sitting on the board of directors of DynaResource, the Dallas-based mining company, which controls a majority stake in the San Jose de Gracia gold mine in Mexico. He and his father, Matthew K. Rose, former CEO of the Burlington Northern Santa Fe Railway, own a controlling interest in the mining company through Golden Post Rail, a limited liability corporation.

Mauricio Flores, who writes the People Behind the Money column for La Razón de Mexico, discounts the possibility that the St. Louis real estate dealings are related to the subject of his reporting. He has, however, questioned why a reputable American financier would allow himself to become entangled in such a controversy. His May 5 column says DynaResource has been allegedly under investigation by the UIF since 2017 related to its gold-mining operations in the Mexican state of Sinaloa.

Journalist Mauricio Flores writes the People Behind the Money column for La Razon de Mexico.

Flores reported that the government probe stems from questions raised by a 2014 U.S. Security and Exchange Commission filing, which attracted the Mexican anti-corruption agency’s attention to gold ingots that DynaResource claimed were produced at the mine. That claim raised official eyebrows because the mine is not known to possess technology capable of processing raw ore into ingots, Flores reported. Other unidentified UIF records cited by Flores allege an unnamed mining company director’s assertion that the ingots were transferred to the mining company by an unidentified member of organized crime. Flores reported that Mexican authorities were  first alerted to the alleged money laundering in 2017 by Keith Piggot, the then-CEO of GoldGroup, a Canadian mining company. Over the last decade, DynaResource has been mired in litigation with GoldGroup, which holds a minority interest in the mine.

However sketchy this may seem, the allegations merit consideration because DynaResoure’s San Jose de Gracia gold mine is located in a region that is under the control of the Sinaloa Drug Cartel. The territory is essentially lawless, and thousands of its inhabitants have been displaced in recent years due to violence attributed to drug traffickers. Inexplicably, Sinaloa’s gold-mining operations have grown during the same time period, leading some informed sources to suspect that mine operators are paying protection money, or falling directly under the control of the cartels.

If this were not enough, DynaResource has encountered continuing labor and safety troubles at the mine. But these ongoing issues did not deter Golden Post Rail from investing $3.9 million in the company this year.

The Treasures of the Sierra Madre

Phillip A. Rose’s financial interests are not confined to The Treasures of the Sierra Madre, however.

North of the border, he and Redlingshafer Jr. are managers and directors of RedRose Capital LLC and AKR Ventures STL LLC — two Texas-based limited liability corporations engaged in acquiring real estate in Missouri. Redlingshafer Jr. is also the registered agent of the two companies. But the mailing address for both is listed as being hundreds of mile away from his suburban home in the St. Louis suburb of University City. According to Texas incorporation records, the registered address for the companies is  5844 Marquita Ave., a single-family residence in Dallas.

In this case, there is no proof of wrongdoing. It may even be argued that such unfettered capitalism is emblematic of good-old fashioned American (and Mexican) free enterprise. But but these transactions are also bereft of any transparency. In recent years, Byzantine networks of limited liability corporations have been the subject of investigations that have uncovered how such shell companies are used by the wealthy to secretly acquire real estate to hide assets and avoid taxes. These backroom transactions may be legal or illegal, but their purpose is the same. Since the publication of the Panama Papers in 2016 not much has changed.

Pending legislation before the lame duck session of Congress is seeking to shed some light on this dark place.

In an op-ed that appeared in The Hill this week, Rep. Carolyn B. Maloney (D-NY), House sponsor of the Corporate Transparency Act, outlined the problem and what is at stake:

“… Corporations and limited liability companies (LLCs) are formed at the state level in the U.S., and no U.S. state currently requires companies to disclose their true, beneficial owners. This means that the U.S. is the world capital of anonymous shell companies — and is a hub for not just money laundering but also terrorist financing. Yes, that’s right — the same terrorist groups that attack the U.S. are also using the U.S. financial system to move their money, and to finance their operations. It’s appalling, and it has to end. …”