JPMorgan Chase processed more than $1.1 billion in transactions for Jeffrey Epstein over a 15-year period, despite repeated anti-money laundering (AML) red flags raised internally, according to an investigative report by The New York Times.
Though Epstein was a convicted sex offender and under investigation for sex trafficking, senior executives at JPMorgan repeatedly overruled compliance staff who flagged his large cash withdrawals, prolific wire transfers, and financial dealings with young women, many of whom were later identified as victims of Epstein’s abuse, the newspaper said.
AML officers at JPMorgan noticed troubling patterns as early as 2003, including Epstein’s frequent five-figure monthly cash withdrawals and wire payments to young women, sometimes to accounts opened without proper verification. These transactions were not reported to regulators in real time, as required by the Bank Secrecy Act. Only in 2019, after Epstein’s arrest and subsequent death, did JPMorgan file a suspicious activity report (SAR) retroactively flagging 4,700 transactions linked to Epstein.
Despite multiple internal warnings and external signs of criminality, JPMorgan opened at least 134 accounts for Epstein, his shell companies, associates, and victims. The bank even wired money to Russia and Eastern Europe, where Epstein was sourcing young women, and provided him with new lines of credit, private banking privileges, and confidential market information.
Senior AML officer William Langford, a former Treasury official, pressed for Epstein’s removal in 2011, citing AML risks and the bank’s own anti-trafficking initiatives. However, Langford’s recommendation was overridden. Internal memos show that Jes Staley, a longtime Epstein ally and then-head of JPMorgan’s private bank, defended Epstein repeatedly and downplayed the risks.
The bank’s handling of Epstein’s accounts violated multiple core AML and Know Your Customer (KYC) standards:
- Failure to verify account holders: JPMorgan opened accounts for women on Epstein’s behalf without in-person meetings or full identity checks.
- Structuring of transactions: Epstein used business accounts (e.g., Hyperion Air) to disguise personal withdrawals.
- Lack of timely SARs: Despite recognizing his behavior as suspicious, JPMorgan failed to file required reports until after public scrutiny in 2019.
- Insider involvement: Executives including Staley continued to advocate for Epstein, even as the bank faced regulatory scrutiny and a 2013 cease-and-desist order over broader AML failures.
According to compliance staff, Epstein’s client profile — a sex offender with prolific high-risk activity — should have triggered immediate offboarding. Instead, executives prioritized Epstein’s value as a source of referrals and business deals, including a $1.3 billion hedge fund acquisition and access to billionaires like Sergey Brin and Leon Black.
In 2023, JPMorgan paid $290 million to settle with Epstein’s victims and $75 million to resolve a lawsuit brought by the U.S. Virgin Islands.
Read more at The New York Times