US News

Jeffrey Epstein’s wealth may be explained by a Ponzi scheme

The mystery source of Jeffrey Epstein’s wealth could be buried in a 1980s fraud case resurfacing as the billionaire financier faces a slew of sex-trafficking charges.

For years, Epstein’s old boss, Steven Hoffenberg, has claimed that Epstein was his accomplice in a Ponzi scheme Hoffenberg ran through his Towers Financial Corp.

Hoffenberg briefly funded The Post from January-March 1993, before losing control of the paper.

While Hoffenberg sat behind bars for 20 years in a New Jersey federal prison, Epstein allegedly lived a sex-crazed lifestyle in which he preyed on underage girls as young as 14, federal prosecutors allege.

Investigators describe him as “a man of nearly infinite means,” but the source — and magnitude — of his money has long been a Wall Street enigma.

Epstein’s Virgin Islands-based Financial Trust Co., a money management firm for billionaire clients only, “generates no public records, nor has his client list ever been released,” Forbes wrote in a 2010 article titled “Sex Offender Jeffrey Epstein Is Not a Billionaire.”

After the hedge-funder was arrested last Saturday on child sex-trafficking charges, Hoffenberg’s claims began to re-emerge.

In a new interview, Hoffenberg said Epstein was “totally in the mix” of the scheme that defrauded 200,000 investors of $460 million.

“He was my colleague daily, seven days a week,” Hoffenberg told Quartz magazine this week.

Tower investors also claimed in an August lawsuit that Epstein “knowingly and intentionally utilized funds he fraudulently diverted and obtained from this massive Ponzi scheme for his own personal use to support a lavish lifestyle.”

Epstein used the fraudulent funds to found Financial Trust in 1996, a business he used to manage the money of Victoria’s Secret mogul Les Wexner, among other clients, the investors allege.

In court papers filed in conjunction with Epstein’s bail application — which offers his $77 million Upper East Side townhouse and private jet as collateral — Epstein’s lawyers asked a judge to keep his financial records under wraps.

“Here, in the event Mr. Epstein is required to publicly file his financial statement, the information contained therein will inevitably be widely disseminated in the news media, contravening the statutory requirement of confidentiality,” Epstein lawyer Reid Weingarten wrote.

In the latest twist in the case, Manhattan prosecutors alleged Friday Epstein attempted to buy the silence of at least two witnesses.