The bank is also being sued by the US Virgin Islands, where the "Island of Sin," as it's now called, was located. Last week, JPMorgan agreed to pay $290 million to settle a class-action lawsuit filed by a woman who claims the bank ignored red flags about Epstein's sexual exploitation of young women - some of whom claim he flew them to his private island to have sex with him and other men - because he helped the bank make money. Two of Jeffrey Epstein's alleged victims, Michelle Licata (L) and Courtney Wild (R), exit a New York courthouse on July 8, 2019, the day that federal prosecutors charged Epstein with sex trafficking. Instead, the bank made the decision again and again to stay with him.Įpstein was allowed to get away with it for so long, the thinking goes, because he surrounded himself with rich and powerful people, some of whom helped Epstein, a former schoolteacher, get rich himself. Since Epstein's sex crimes first came to light in 2005, shortly after the Highbridge deal closed, the bank had many, many opportunities to ditch Epstein - including following his arrest on a prostitution charge in 2006, his guilty plea and jailing in 2008, in 2010 amid reports that Epstein was being probed for "child trafficking," and in 2011, when high-level JPMorgan compliance officials raised red flags internally. One month later, he was found dead in a Manhattan jail cell in what the city coroner ruled a suicide. After years of scrutiny over the government's handling of his case, federal prosecutors charged Epstein in 2019 with sexually exploiting and trafficking dozens of underage girls. It also solidified Epstein's relationship with Jes Staley, the head of JPMorgan's private banking business, who would be Epstein's principal contact at the bank until he was finally cut loose in 2013 and who once referred to Epstein as his "most cherished friend."Įpstein helped the bank by sending business its way, court documents say, and Staley and others, it has since been alleged, both protected Epstein and enjoyed his company - even as JPMorgan executives raised alarm bells over Epstein's accounts multiple times.įast-forward to today and Epstein's name is synonymous with sex abuse and the corrupting power of money. The Highbridge deal earned Epstein fees of $15 million for advising the fund, The Wall Street Journal would later reveal. There was an occasional mention of Epstein's penchant for "attractive young women," but nothing that might raise eyebrows. The press described him alternatively as a "financier," "asset manager," "property tycoon," or simply "mysterious New York billionaire," depending on whom you asked. The Highbridge deal was a triumph for JPMorgan and its chief executive, Jamie Dimon.Īnd the man who helped broker the deal was Jeffrey Epstein, a mysterious "financier" known, if at all, for palling around with titans of industry and politics, from the Apollo founder Leon Black to Bill Clinton and Donald Trump.Įpstein seemed to have money, but no one could say for sure what he did for a living. Pretty soon, JPMorgan's rivals - from Morgan Stanley to Citigroup and the now defunct Lehman Brothers - were racing to pay top dollar to beef up their own hedge-fund offerings. Adding to the allure for Wall Street banks were the fat fees (often upward of 20%) that hedge funds were charging clients. And Highbridge, then one of the fastest-growing hedge funds, boasted double-digit annual returns for much of its short life. In September 2004, JPMorgan announced an acquisition that would spark envy across Wall Street: A stake in $7 billion hedge fund giant Highbridge Capital Management.įor those lucky enough to get into the exclusive club, hedge funds were the next frontier in investing. Account icon An icon in the shape of a person's head and shoulders.
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