Jeffrey Epstein.
(Updated: 4:01 PM, 8/8/2019)
Topline: Despite knowing the reputational risks of doing business with Jeffrey Epstein, a high-ranking JPMorgan executive intervened to keep him as a client in order to access his network of the uber-wealthy and famous, according to a New York Times report.
- JPMorgan reviewed its client roster ten years ago and determined it should remove Epstein after a review of his accounts were found to be “potentially problematic.”
- The bank made the removal decision after Epstein began serving time in a Florida jail and registered as a sex offender.
- The executive, Mary Erdoes, allegedly reversed the bank’s decision, since Epstein helped recruit new, mega-rich clients to JPMorgan’s elite private-banking division.
- Another executive, James Staley, even visited Epstein while he was incarcerated.
- The Times suggests that Erdoes was doing Staley’s bidding; he maintained a solid relationship with Epstein.
- JPMorgan and Epstein (and Staley) parted ways in 2013, at which point the registered sex offender moved his money to Deutsche Bank (which came under fire in July).
- A JPMorgan spokesperson denied the New York Times report as being false, and said Erdoes did not interfere or overrule compliance or any control function at the bank to retain Epstein as a client.
Surprising fact: Billionaire retail magnate Leslie Wexner was a JPMorgan client well before Epstein joined the bank. Wexner admitted in a letter Wednesday that Epstein misappropriated at least $46 million of his fortune.
Key background: Epstein has been under scrutiny since a 2007 federal sex crimes indictment, alleging he sexually abused dozens of underage girls, resulted in a lenient Florida plea deal. The Miami Herald’s 2018 investigative series detailed how a federal prosecutor, Alexander Acosta, helped broker the plea deal. The agreement granted Epstein and his anonymous coconspirators immunity and sealed all documents. A federal judge ordered in July to unseal documents associated with the case, which could implicate other rich, powerful people. Prosecutors in Epstein’s current case appear to have successfully sealed those documents—for now. Epstein served 13 months in a Florida jail after conviction on a prostitution charge and registered as a sex offender. After his release from county jail, Epstein went free until his July 6 arrest, after which he was charged with sex trafficking and sex conspiracy. He pleaded not guilty and was denied bail.
