Two of the highest-ranking executives at JPMorgan Chase pointed fingers elsewhere and denied having had knowledge of Jeffrey Epstein’s long history of sexually abusing teenage girls and young women, as they sought to deflect accusations that the bank ignored multiple warnings about the disgraced financier.
Testimony released in recent days from Jamie Dimon, JPMorgan’s longtime chief executive, and Mary Erdoes, head of the asset and wealth management group, has painted a picture of corporate leaders who rarely communicated with one another about a man who would become one of the bank’s most notorious customers. The comments were made in depositions related to two lawsuits against the bank.
JPMorgan has repeatedly denied having any knowledge of Mr. Epstein’s illicit activity. The lawsuits brought by Mr. Epstein’s victims and the government of the U.S. Virgin Islands claim that for nearly 15 years, the nation’s biggest lender mostly looked past warning signs that Mr. Epstein was financing illicit sexual activities at his palatial residences in New York, Florida and the Virgin Islands.
Those signs, most notably large cash withdrawals, raised warnings within the bank. The suits, filed in Manhattan federal court, contend that JPMorgan chose to keep Mr. Epstein as a client for so long because he was bringing business to the bank.
Mr. Dimon’s deposition was taken Friday, but a redacted transcript was released on Wednesday and reviewed by The New York Times. It shows he repeatedly denied meeting or communicating with Mr. Epstein. He also said he had no recollection of being briefed by any of his top lieutenants on any issues with Mr. Epstein, including his 2008 conviction in Florida on a charge of soliciting prostitution from a teenage girl — an offense that forced him to register as a sex offender.
Widely regarded as one of the most powerful executives on Wall Street, Mr. Dimon said he had barely heard of Mr. Epstein before his July 2019 arrest on federal sex trafficking charges, even though Mr. Epstein — who was worth some $600 million when he died — was often tabloid fodder because of his friendship with Prince Andrew and the wealthy men who associated with him, including Bill Gates, the investor Leon Black and the tech billionaire Peter Thiel. .
“I don’t recall knowing anything about Jeffrey Epstein until the stories broke sometime in 2019, and I was surprised that I didn’t even — had never even heard of the guy, pretty much. And how involved he was with so many people,” Mr. Dimon said during the all-day deposition taken at JPMorgan’s headquarters in Manhattan.
The bank stopped doing business with Mr. Epstein in 2013.
Ms. Erdoes, in a deposition taken in March that was also reviewed by The Times, said the decision to dismiss Mr. Epstein as a customer was made following an annual review of his accounts because he had been deemed a “high risk client” by the bank. The review took place several months after James E. Staley, who had been a top private banker at JPMorgan, left the bank in January 2013.
Ms. Erdoes said the decision to stop doing business with Mr. Epstein was made easier with Mr. Staley gone from the bank.
“Mr. Staley was Mr. Epstein’s advocate in the bank and was the senior relationship manager for Mr. Epstein,” Ms. Erdoes said. “And without someone there advocating for Mr. Epstein and the situation that I viewed, I was exiting Mr. Epstein.”
The depositions reflect something of a blame game at JPMorgan, with some suggesting that Mr. Staley should have known about Mr. Epstein’s sex trafficking, and that he had the duty to let others know. JPMorgan has separately sued Mr. Staley in a bid to hold him liable for any damages it may have to pay.
Mr. Staley, who is scheduled to be deposed as soon as next week, has argued in court papers that he did nothing wrong or inappropriate. His lawyers did not return requests for comment
In a statement on Wednesday, JPMorgan said it regretted having Mr. Epstein as a client.
“Had the firm believed he was engaged in an ongoing sex trafficking operation, Epstein would not have been retained as a client,” the statement said.
David Boies, a lawyer for Mr. Epstein’s victims suing the bank, said Ms. Erdoes and others at JPMorgan, “were fully aware of Epstein’s large cash withdrawals and Epstein’s sex trafficking. If, as he claims, Mr. Dimon was the only person in New York who never heard of Epstein before July 2019, that is an indictment, not a defense.”
So far, dozens of depositions have been taken in the litigation. Judge Jed S. Rakoff of Federal District Court in Manhattan has put them on a fast track, with Mr. Dimon’s among the last to be taken of bank employees.
In Ms. Erdoes’s deposition, portions of which were earlier reported by The Washington Post, she said she personally informed Mr. Epstein that she was dismissing him as a client in summer 2013, during a visit to his Manhattan home. She said it was only the second time she had met him in person.
Ms. Erdoes said she was not satisfied with Mr. Epstein’s explanation that large cash withdrawals were associated solely with his air travel. But when lawyers for the victims asked her whether the withdrawals may have been for payments to “women and girls,” Ms. Erdoes said she wasn’t sure what Mr. Epstein did with the funds.
When asked why similar cash withdrawals by Mr. Epstein had not led to his dismissal earlier, Ms. Erdoes said she wasn’t “privy to those discussions.” Mr. Dimon said he was never informed that some within the bank were concerned about Mr. Epstein’s cash withdrawals going back as far as 2006.
Mr. Dimon also said Stephen Cutler, the bank’s general counsel from 2007 to 2015, never raised any concerns with him about Mr. Epstein. He said that he believed Ms. Erdoes and Mr. Cutler “were both trying to do the right thing” with the information they had at the time.
But a court document filed in the litigation suggests Mr. Epstein’s transactions had raised warning signs within the bank for many years. In the document — initially filed publicly but now under seal — JPMorgan said dozens of bank employees had been involved in determining whether suspicious activity reports, or SARs, should be filed about some of Mr. Epstein’s transactions from 2000 to 2019.
The document offered no details on those transactions. Banks file SARs with U.S. regulators to alert them to possible money laundering, fraud or other illegal activity.
The same document also reported that in fall 2019 the bank’s board of directors held two meetings to discuss “Epstein-related issues.” The document did not provide any information on those meetings, which occurred shortly after Mr. Epstein’s death. The document noted that during the 15 years the bank did business with Mr. Epstein, the board never met to discuss the bank’s dealings with him.
The board meetings came around the time that a number of news organizations, including The Times, were reporting on the bank’s relationship with Mr. Epstein and his close ties with Mr. Staley.
Mr. Dimon said in retrospect that he wished he and others had known more about Mr. Epstein’s crimes. He said that the bank’s involvement with the sex offender ranks as one of its bigger reputational hits but that the bank should not be held liable for Mr. Epstein’s sins.
“I think what happened to these women is atrocious,” he said. “I wouldn’t mind personally apologizing to them, not because we committed the crime. We did not. And not because we believe we’re responsible, but that any potential thing, what little role that we could have eased it or helped catch it quicker or something like that.”
