JPMorgan Chase reached a tentative settlement on Monday with sexual abuse victims of deceased financier Jeffrey Epstein following embarrassing revelations about the bank’s longtime relationship with him, said the bank and lawyers for the victims.
The proposed deal would settle a lawsuit filed last November in Manhattan federal court by an unnamed woman on behalf of victims who were sexually abused by Mr. Epstein over a period of about 15 years, when they were teenage girls and young women, according to the suit. he said. The number of victims could potentially exceed 100.
In the statement, the bank and lawyers for the victims said they had reached “an agreement in principle” to settle the lawsuit on behalf of the victims and that “the settlement is in the best interests of all parties, particularly the survivors.” who were victims of Epstein’s horrific abuse.The statement did not disclose the settlement amount.
The settlement agreement comes nearly two weeks after a statement a day from JPMorgan chief executive and one of Wall Street’s best-known bankers, Jamie Dimon, in which he said he met with Mr Epstein before the financier’s July 2019 arrest. Barely heard about. sex trafficking allegations.
Mr Epstein killed himself in a Manhattan jail cell in August 2019, a month after his arrest.
JP Morgan is still facing a related lawsuit by the government of the US Virgin Islands. The trial remains the biggest case related to Epstein after civil suits against Mr Epstein’s assets and the sentencing of Ghislaine Maxwell in Manhattan federal court in 2021 for helping Mr Epstein engage in sex trafficking.
The lawsuit filed by the victims alleged that JPMorgan ignored repeated warnings that Mr. Epstein was sexually active even after registering as a sex offender and pleading guilty to prostitution of a teenage girl in a 2008 Florida case. Teenage girls and young women were trafficked for sex. , The complaint said the bank ignored red flags in Mr Epstein’s activities because it valued him as a wealthy client who had access to dozens of wealthy individuals.
Court documents and deposition testimony reviewed by The New York Times revealed that bank employees had filed multiple suspicious activity reports about Mr. Epstein’s repeated large cash withdrawals. Legal documents showed that after Mr. Epstein was designated a “high-risk customer” in 2006, the bank had kept him as a client, despite media reports alleging sexual abuse of teenage girls and that There was evidence that some of the cash withdrawals were for payment. Dozens of girls.
JPMorgan provided banking services for Mr Epstein from roughly 1998 to 2013 – a period in which federal officials and victims have said some of the worst conduct was committed by the financier, who had offices in Manhattan, Florida, the US Virgin Islands I had palatial houses. , New Mexico and Paris.
The bank had said several times before reaching the settlement that it did not assist Mr. Epstein in committing “his heinous crimes” and that “ultimately, any association with him was a mistake.”
In a separate lawsuit, the same lawyers for Mr Epstein’s victims last month tentatively negotiated a $75 million settlement with Deutsche Bank, which followed JPMorgan as Mr Epstein’s primary banker. Deutsche, which ended its relationship with Mr Epstein in late 2018, paid a $150 million fine to New York regulators in 2020 after alleging it violated its relationship with the disgraced financier among other compliance failings. Failed to adequately police financial behaviour.
The settlement with the two banks must be approved by Judge Jed Rakoff of Federal District Court in Manhattan. Judge Rakoff is also presiding over a related lawsuit by the government of the US Virgin Islands.
The Virgin Islands, a US territory in the Caribbean, argue that JPMorgan should pay damages for enabling Mr Epstein to set up a sex trafficking operation at his private island residence on St Thomas. But JPMorgan, in court papers, strongly opposed the lawsuit, arguing that government officials there colluded with Mr. Epstein for nearly two decades.
Two of Mr. Epstein’s businesses received lucrative tax breaks from US territory worth hundreds of millions of dollars. Shortly after JPMorgan ended its relationship with Mr. Epstein, the Virgin Islands approved a boutique banking license for Mr. Epstein, the first of its kind.
Judge Rakoff had put the lawsuits against JPMorgan on a fast track, with more than a dozen depositions over the past three months, including one from Mr. Dimon and another from Albert Bryan Jr., the governor of the Virgin Islands . The deal between JPMorgan and Mr. Epstein’s victims was settled because some of the plaintiffs’ lawyers were taking a deposition from James E. Staley, a former JPMorgan executive who had close ties to Mr. Epstein.
In court filings, the Virgin Islands claimed Mr Epstein and Mr Staley shared sexually suggestive emails about young women.
Mr Staley, known as Jess, has repeatedly denied in court papers any wrongdoing or being aware that Mr Epstein sexually abused young women and teenage girls. JPMorgan then sued Mr. Staley to ensure that, if it was determined that he had engaged in improper activity, he could be held liable for damages to be paid by the bank.
Victims’ attorneys who were most involved in prosecuting and negotiating proposed settlements with the two banks included David Boies, Sigrid McCauley, Brad Edwards, and Brittany Henderson.
“It’s taken a long time, a very long time, but today is a great day for the survivors of Jeffrey Epstein,” Mr. Boes said of the proposed settlement with JPMorgan. Ms. McCauley, who argued before Judge Rakoff that the JPMorgan lawsuit should be treated as a class action, said that “the settlements signal that financial institutions have an important role to play in finding and shutting down sex trafficking.”
In court papers attached to the proposed settlement with Deutsche Bank, lawyers for the victims said they expected to collect fees of up to 30 percent. Lawyers in the JPMorgan litigation are likely to submit similar fee requests. Any charge request must be approved by Judge Rakoff.
In the Deutsche Bank settlement, each of the victims will be entitled to receive damages ranging from $75,000 to $5 million, according to a court filing.
The settlement with the two banks will include relief for many of Mr Epstein’s victims in recent years. Mr Epstein’s estate has paid damages of around $150 million to more than 125 victims – many of whom may be eligible to apply for additional compensation from deals with Deutsche and JPMorgan.
