JPMorgan Is Alleged to Have Used Its Hedge Fund’s Private Jet to Engage in Sex-Trafficking for Jeffrey Epstein

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JPMorgan Is Alleged to Have Used Its Hedge Fund’s Private Jet to Engage in Sex-Trafficking for Jeffrey Epstein

By Pam Martens and Russ Martens: June 19, 2023 ~

Attorney David Boies with Virginia Roberts Giuffre at Jeffrey Epstein Court Hearing in New York, August 27, 2019

At a March 13 court hearing this year, prominent attorney, David Boies, argued in open court that the largest federally-insured bank in the United States, JPMorgan Chase – which has more than 5,000 Chase bank branches holding mom and pop savings from coast to coast – had used a private jet owned by the bank’s hedge fund, Highbridge Capital, to transport girls for Epstein’s sex trafficking operation.

A January 13, 2023 amended complaint filed by Boies’ law firm, elaborated on the allegation as follows:

“As another example of JP Morgan and [Jes] Staley’s benefit from assisting Epstein, a highly profitable deal for JP Morgan was the Highbridge acquisition.

“In 2004, when Epstein’s sex trafficking and abuse operation was running at full speed, Epstein served up another big financial payday for JP Morgan.

“Epstein was close friends with Glenn Dubin, the billionaire who ran Highbridge Capital Management.

“Through Epstein’s connection, it has been reported that Staley arranged for JP Morgan to buy a majority stake in Dubin’s fund, which resulted in a sizeable profit for JP Morgan. This arrangement was profitable for both Staley and JPMorgan, further incentivizing JP Morgan to ignore the suspicious activity in Epstein’s accounts and to assist in his sex-trafficking venture.

“For example, despite that Epstein was not FINRA-certified, Epstein was paid more than $15 million for his role in the Highbridge/JP Morgan deal.

“Moreover, Highbridge, a wholly-owned subsidiary of JP Morgan, trafficked young women and girls on its own private jet from Florida to Epstein in New York as late as 2012.”

This allegation is unique and explosive because it moves JPMorgan Chase from being just a cash facilitator for Epstein’s sex-trafficking of underage girls to engaging directly in the sex-trafficking. Unfortunately, the American people may never get to see the evidence that proves or disproves that critical allegation because of a settlement in the case.

David Boies has been the Chairman of the law firm, Boies Schiller Flexner, since its founding in 1997. He and his law partner, Sigrid McCawley, know more about the sex-trafficking operations of Jeffrey Epstein than any other two lawyers on the planet. That’s because they have won the confidence of Epstein’s victims to confide in them the grotesque details of the sex trafficking operation and name names, including which of Epstein’s friends they were trafficked out to. The Boies firm has been settling claims for various Epstein’s victims for years now.

Two high profile lawsuits are now pending in federal court in Manhattan against JPMorgan Chase for its role in functioning as Jeffrey Epstein’s cash conduit for more than a decade to pay off his victims and launder money to his accomplices (such as Ghislaine Maxwell). One of the cases was brought by Boies and McCawley and their team of lawyers. The related case was brought by the Attorney General of the U.S. Virgin Islands, where Epstein owned an isolated island compound and flew underage girls in and out.

Both lawsuits were consolidated for pre-trial discovery under Judge Jed Rakoff, who seems to get a curious number of sensitive JPMorgan cases where critical details are lost to darkness under redactions and protective orders. (See Judge Rakoff Signs a Dangerous Protective Order in Whistleblower Case Against 5-Count Felon JPMorgan Chase.)

After JPMorgan was confronted with overwhelming internal email evidence, obtained during discovery and documented further during depositions, that the bank played a central and pivotal role in allowing Epstein’s operations to continue for more than a decade by providing him with millions of dollars in cold, hard cash from his accounts, in brazen violation of anti-money laundering laws, the bank decided on June 12 to settle the Boies case on behalf of Epstein’s victims for $290 million.

The lawyers for plaintiffs and the bank have until this Thursday, June 22, to file their moving papers detailing the terms of the settlement, according to a docket entry in the case. A preliminary fairness hearing on the settlement, which has been styled as a class action, is scheduled for June 26 at 4 p.m. ET before Judge Rakoff in courtroom 14B of the Daniel Patrick Moynihan Courthouse, 500 Pearl Street, New York City. (That is a strangely fast turnaround for a fairness hearing in such an important case and raises more red flags. The case is being settled as a class action, ostensibly on behalf of a large number of Epstein victims. That would mean that these victims would need to be notified, and have time to hire their own attorneys, in order to digest the terms of the settlement, and speak pro or con at the fairness hearing. Some of these women may be living abroad and not even get the notice of the settlement in time to travel to the fairness hearing in Manhattan.)

Equally problematic, JPMorgan’s lawyers have decided to launch a brutal smear campaign against the U.S. Virgin Islands and vows to never settle that case. This could keep the smear campaign in the headlines as the fairness hearing quietly plays out in lower Manhattan.

JPMorgan Chase is the bank that has turned money laundering into an art form – including admitting to two felony counts for aiding and abetting the largest Ponzi scheme in history for Bernie Madoff. It now has the audacity to argue  in court papers that the U.S. Virgin Islands’ case should be dismissed because the Virgin Islands has “unclean hands” in the Epstein matter. JPMorgan has filed public court documents showing that the wife of a former Governor of the Virgin Islands, Cecile de Jongh, had worked for Epstein companies and aided and abetted him while other named politicians also provided perks to Epstein.

While the substance of these allegations has not been denied, if the Attorney General of the United States was prevented from bringing cases because of a handful of corrupted politicians or their spouses, justice would grind to a halt in the U.S. In addition, it is established law that governments are allowed to pursue justice on behalf of their citizens, unlike private litigants where the unclean hands doctrine might prevail.

JPMorgan’s legal strategy against the U.S. Virgin Islands looks like a dud thus far. Last Friday, Ariel Smith, the Attorney General of the U.S. Virgin Islands, took to the airwaves to denounce the legal and public relations tactics of JPMorgan Chase to smear the good people of the Virgin Islands to distract from its own culpability. Attorney General Smith said this in a public statement that has now been captured on the Attorney General’s official YouTube channel:

“…for an entire decade JPMorgan Chase facilitated and concealed Jeffrey Epstein’s heinous crimes. I want to explain to the Virgin Islands’ residents what that means. As Congress recognized, banks like JPMorgan are the first line of defense against human trafficking. They have access to real-time information about how bank customers use their accounts. As part of their access to real-time information, banks have a legal obligation to report suspected unlawful activity, including signs of human trafficking.

“The evidence of wrongdoing that JPMorgan had regarding Jeffrey Epstein’s activities were both unique and overwhelming. So much so that JPMorgan Chase’s staff frequently emailed each other about Epstein’s suspicious activity, even connecting them to reports about his criminal activity.”

The evidence that Attorney General Smith is referring to consisted of hundreds of internal JPMorgan Chase emails and documents. The internal emails revealed that from General Counsel Stephen Cutler; to William Langford, the Global Head of Compliance; to Maryanne Ryan, the Vice President for Anti-Money Laundering; the bank was aware that Epstein was a bad actor and yet continued to service dozens of his accounts and related accounts.

How did Boies bring JPMorgan to the settlement table while the U.S. Virgin Islands ended up as its piñata? 

The Boies law firm describes its philosophy as follows: “We treat every case from its inception as though it is headed to trial, relentlessly and methodically developing the factual record in a way that positions us for success in or out of the courtroom.” 

A deeply-developed factual record is how the Boies law firm obtained a settlement last year from Prince Andrew for allegedly having sex with Virginia Roberts Giuffre, who was allegedly pimped out by Epstein to his pals for sex when she was just 17. (It is far from certain that the public has learned the full list of names of powerful men to whom Epstein provided underage girls for sex. Epstein died in 2019 in a Manhattan jail. The medical examiner ruled the death a suicide.)

It is also far from certain that the American people will ever get to see the full factual record buttressing the allegation that a private jet belonging to a hedge fund subsidiary of JPMorgan Chase was directly engaged in transporting sex trafficked victims of Jeffrey Epstein. Why not release that evidence before the case is settled?

The serial pattern of illegal conduct at JPMorgan Chase is so over the top that on September 29, 2020 the nonprofit watchdog, Better Markets, released a special report, titled: “After 20 Years of Repeated Illegal Conduct, the DOJ Must Bring Criminal Charges Against JPMorgan Chase and Its Executives.” The report includes this analysis:

“…JPMorgan Chase has a 20-year long RAP sheet that includes at least 80 major legal actions that have resulted in over $39 billion in fines and settlements. That RAP sheet, detailed below, reveals wide-ranging, predatory, and recidivist lawbreaking – some admitted, some alleged — from 1998 through 2019. The bottom line is this: JPMorgan Chase has reportedly committed scores of illegal acts and preyed upon and ripped off countless Main Street Americans with a frequency and severity that is shocking in its depth and breadth.

“Any other business in America with that recidivist record would almost certainly have been shut down by prosecutors long ago; executives at any other business in America with that recidivist record would likely be serving long prison sentences. But not JPMorgan Chase. Instead, this gigantic, wealthy, powerful, politically connected and too-big-to-fail Wall Street bank repeatedly gets favorable treatment by the government and is repeatedly allowed to use shareholders’ money to pay fines and buy get-out-of-jail-free cards for its executives in sweetheart settlements.”

We urge our readers to take the time to carefully read the seminal Better Markets’ report on the unprecedented and serial lawlessness of the largest bank in the U.S. and then ask themselves this question: why is the government of the Virgin Islands left to bring a civil complaint against JPMorgan Chase for its pivotal role in Jeffrey Epstein’s sex trafficking of underage girls, instead of the U.S. Department of Justice bringing a criminal complaint on behalf of all Americans?

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FOCUS: Why Daniel Ellsberg Tried to Get Prosecuted Near His Life's End

 

Why Daniel Ellsberg Tried to Get Prosecuted Near His Life's End

Charlie Savage/New York Times

Daniel Ellsberg and his wife, Patricia. His disclosure in 1971 of the Pentagon Papers and its fallout left a stamp on history that defined the bulk of his life. (photo: Donal F. Holway/NYT)

When Daniel Ellsberg was 42, a judge threw out Espionage Act charges against him. At 90, he sought such charges again in hope of challenging their constitutionality.

In the last years of his long and remarkable life, Daniel Ellsberg, the disenchanted military analyst who famously leaked the so-called Pentagon Papers in 1971, wanted to be prosecuted. And he hoped I would help pave the way.

The charge he coveted was mishandling national security secrets under the Espionage Act, and his plan was to give me another classified document he had taken decades ago that he had held onto without authorization all this time. He wanted to mount a defense in a way that would offer the Supreme Court an opportunity to declare that law unconstitutional as applied to those who leaked government secrets to reporters. It is the same law former President Donald J. Trump is now accused of violating 31 times, though under very different circumstances.

Mr. Ellsberg’s disclosure in 1971 of the Pentagon Papers — a classified study of the Vietnam War showing that a generation of military and political leaders had lied to the public — and its fallout left a stamp on history that defined the bulk of his life.

But buried in some obituaries were glancing references to a 2021 episode in which he gave me a top-secret document about American military leaders’ push to carry out a first-use nuclear strike on China in 1958, accepting the risk that the Soviet Union would retaliate in kind on behalf of its ally, and that millions of people would die.

In examining his legacy, the scrutiny he tried to bring to the Espionage Act in making that disclosure also deserves attention.

“I will, if indicted, be asserting my belief that what I am doing — like what I’ve done in the past — is not criminal,” he told me, arguing that using the act “to criminalize classified truth-telling in the public interest” should be deemed unconstitutional.

The government has various tools to deter and punish unauthorized disclosures to reporters and the public, and for most of American history, it did not try to send leakers to prison. The Espionage Act has been on the books since World War I, but it was not until the second half of the 20th century that the government began trying to use it to charge leakers instead of spies — initially, to little success.

In 1957, the military included Espionage Act charges in the court-martial of an Army colonel for giving reporters information about a disputed missile program, but prosecutors dropped the charges. In 1971, the Justice Department obtained its first such indictment in the case against Mr. Ellsberg and a colleague who had helped him, Anthony Russo. But a judge threw out the charges, citing government misconduct and illegal evidence gathering.

A decade later, the Justice Department under the Reagan administration tried again, bringing Espionage Act charges against a defense analyst who had provided classified satellite photographs of a Soviet shipyard to Jane’s Defence Weekly. He was convicted. But it was so odd and unfair that only one person had been sent to prison for an act that had happened routinely for decades that President Bill Clinton pardoned him in 2001.

Starting midway through the George W. Bush administration and continuing under presidents of both parties, however, the Justice Department began routinely going after leakers using the Espionage Act. The law carries a harsh penalty — 10 years per count — and defendants are forbidden to suggest that juries acquit by arguing that their disclosures were in the public interest. Most defendants take plea deals to avoid the risk of lengthy sentences, foreclosing the opportunity for appeals challenging the constitutionality of using the law in such circumstances.

Mr. Ellsberg and I had talked about the government’s accelerating use of the law in 2014, when I wrote about how Edward J. Snowden, a former contractor for the National Security Agency who leaked secrets about surveillance activities, had joined the board of a nonprofit press freedom organization Mr. Ellsberg helped found. (Mr. Snowden, whom Mr. Ellsberg publicly embraced as a kindred spirit, has been living in Russia as a fugitive from Espionage Act charges.)

“The question — which hardly anyone realizes, I would say, is a question — is whether this application of the Espionage Act to people who are informing the U.S. public, not secretly informing a foreign power like a spy, is constitutional,” he told me. “The issue is hardly ever raised now. It wasn’t in my mind when I revealed the Pentagon Papers — I assumed I was breaking the plain language of that law, as I had been warned. And I was.”

In the years that followed, more reporters’ sources faced Espionage Act charges. And in 2019, the Justice Department under the Trump administration crossed a new line by obtaining an Espionage Act indictment of the WikiLeaks founder Julian Assange — not for leaking, but for soliciting and publishing leaks. The department under the Biden administration has kept those unprecedented charges; Mr. Assange has delayed a trial by fighting extradition in Britain, but keeps losing appeals there.

It was against that backdrop that Mr. Ellsberg called me on a sunny Saturday afternoon in the spring of 2021. At the time, I was watching a Little League game. I moved away from the low bleachers and lawn chairs to get out of earshot of other parents.

Decades ago, Mr. Ellsberg said, he had taken a second classified study based on internal government records, which he had not given to reporters at the time of the Pentagon Papers because it was about a different topic: when Communist Chinese forces shelled islands controlled by Taiwan in 1958, setting off a crisis. It showed that the world had come closer to nuclear war than the public had been allowed to know.

Was I interested in writing about it? I was.

In the weeks that followed, I carefully read the Taiwan study and consulted experts on the history of the 1958 crisis. As I worked on my article, Mr. Ellsberg and I spoke repeatedly. He preferred to talk by video call from his book-crammed home office in California. On one lengthy call, his wife, Patricia, joined us.

Part of his motivation, he said, was renewed tensions over Taiwan. He said it was likely that Pentagon war planners were again drawing up contingency plans to use nuclear weapons if China were to attack Taiwan and it appeared that conventional weapons were not enough to repel it. He thought the possibility of any such dire step warranted a public debate.

But another reason, he said, was that in openly confessing to retaining and disseminating the classified document without authorization, he hoped to be charged under the Espionage Act. He wanted to be a test case to put before the Supreme Court the constitutionality of how the Justice Department has used the law to punish leaks.

The provision against unauthorized retention of national security secrets, he pointed out, is so expansively written that, on its face, it could also be used to indict journalists, publishers and even readers of a newspaper article about a classified matter who tell a spouse about it or retain a clipping instead of turning it in to the authorities. Citing the chilling effect that the creeping expansion of the law has on what information the public gets in a democracy, he expressed disappointment that the Biden administration had not dropped the Espionage Act charges against Mr. Assange.

“It’s clearly overly broad and does not just apply to people like me who had a security clearance. Assange is now feeling the weight of that,” he said, adding: “For 50 years I’ve been saying to journalists, ‘This thing was a loaded weapon looking at you.’”

In short, at the age of 90, he was willing to risk the prison sentence he had been spared when he was 42. But as aggressive as the Justice Department has become in using the Espionage Act, it apparently wanted no part in going along with Mr. Ellsberg’s plan. The article published and drew some attention — but to his disappointment, no charges ensued.

“I was looking forward to arguing in court,” he told an interviewer in March, after he announced that he had been diagnosed with pancreatic cancer. “This is before I knew that my life would be shorter than I had expected.”

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