JPMorgan allowed to entry Manhattan prosecutors’ information in Epstein case

JPMorgan Chase can study information from Manhattan prosecutors associated to litigation over its resolution to retain Jeffrey Epstein as a consumer, a New York decide dominated on Friday, together with any potential sexual abuse criticism involving former govt Jes Staley.

The US lender first subpoenaed the Manhattan district lawyer’s workplace earlier this month, requesting any statements made by any “particular person figuring out James ‘Jes’ Staley as an alleged witness or an alleged perpetrator of any sexual assault, sexual abuse, or different sex-related crimes”.

The financial institution has sued Staley, looking for to make him accountable for damages it might should pay in reference to two instances introduced in opposition to JPMorgan by an Epstein accuser and the US Virgin Islands, the place the late intercourse offender as soon as had a house. The accuser’s case alleges that Staley raped her and watched her being abused by Epstein. Staley has strongly denied the allegations, calling them “slanderous”.

The order from Decide Jed Rakoff, who’s overseeing the instances in Manhattan federal court docket, got here hours after JPMorgan chief govt Jamie Dimon was set to start answering questions underneath oath about his information of Epstein’s crimes, because the authorized reckoning over the financial institution’s resolution to retain him as a consumer reached Wall Avenue’s highest echelons.

The sworn testimony, which the US’s largest lender had tried to stop from occurring, marks a major escalation in two high-profile instances over JPMorgan’s 15-year relationship with Epstein, which has embarrassed some present and former executives and shone an unflattering mild on the financial institution’s inside compliance processes. The deposition will happen behind closed doorways and is about to last as long as two days.

Dimon’s identify has already come up within the contentious litigation, with the lawsuits in opposition to JPMorgan having been filed in the direction of the tip of final yr. He was referenced in an inside e-mail expressing issues about Epstein, containing the phrases “pending Dimon overview”.

Mary Erdoes, a high JPMorgan govt, advised attorneys in a sworn deposition in March that Dimon was solely in command of supervising Staley, who was on the financial institution for many years and for a interval managed the connection with Epstein, based on folks acquainted with the matter. JPMorgan’s lawsuit in opposition to Staley alleges he misled the financial institution about Epstein’s misdeeds.

In an announcement, JPMorgan stated its boss had by no means met with Epstein, “spoke with him, [or] emailed with him, and was not concerned in any choices about his account”. The financial institution added: “The plaintiffs know this based mostly on a long time of discovery and tens of millions of emails . . . but they persist in pursuit of publicity.”

But the instances stay one of many few blots on the copy guide of the longtime govt. He not too long ago introduced an virtually $16bn spending spree at JPMorgan, has been on the forefront of Wall Avenue’s lobbying efforts for a deal on the US debt ceiling to keep away from default, and scooped up First Republic, a failed lender, in a government-led public sale.

JPMorgan first took on Epstein as a consumer in 1998 and continued to financial institution him till 2013.

Dimon is anticipated to testify that he didn’t have any information of the a number of inside purple flags raised about Epstein’s accounts. Nonetheless, the instances have raised questions extra usually in regards to the robustness of the financial institution’s controls.

“It’s really not excellent news if Dimon didn’t know,” an individual acquainted with the financial institution’s organisational construction stated. “If no one ever reached out to him in roughly a decade of continuous to financial institution [Epstein] after they knew of his conduct and when it was public, that’s maybe even worse information.”

JPMorgan has known as Epstein’s scheme “monstrous” and expressed remorse for having him as a consumer. “In hindsight, any affiliation with [Epstein] was a mistake . . . however we didn’t assist him commit his heinous crimes.”

Final week, Deutsche Financial institution settled separate Epstein-related claims for $75mn, which will likely be shared amongst dozens of girls.

The stakes for JPMorgan might quickly be even increased. Whereas Dimon is being deposed on Friday, a federal decide in New York will hear arguments from representatives of the Epstein accusers, who contend that dozens, if not tons of of girls must be entitled to compensation from the financial institution, which they accuse of taking advantage of human trafficking.

On the eve of Dimon’s deposition, JPMorgan fired again on the US Virgin Islands, alleging in court docket filings that the territory’s officers had turned a blind eye to Epstein’s crimes, and even issued visas to a few of his victims.

“Epstein might have lived wherever on the earth. He selected USVI,” JPMorgan’s attorneys stated. “They shielded and even rewarded him, granting him [millions of dollars] in tax incentives . . . wanting the opposite approach when he walked via USVI airports accompanied by ladies and younger girls.”

In response, the US Virgin Islands attorney-general’s workplace stated such accusations have been “an apparent try to shift blame away from JPMorgan Chase, which had a obligation to report the proof in its possession of Epstein’s human trafficking, and failed to take action”.

Epstein pleaded responsible in 2008 to a state cost in Florida of soliciting a minor for prostitution. Greater than a decade later he was charged by federal prosecutors with intercourse trafficking, and died by suicide in jail in 2019 whereas awaiting trial.