JPMorgan Chase and Deutsche Bank must face lawsuits that accuse them of enabling Jeffrey Epstein’s intercourse trafficking, a US judge mentioned Monday.
The determination by US District Judge Jed Rakoff in Manhattan might expose the banks to extra monetary and reputational harm for retaining Epstein as a shopper, even after the late financier registered as a intercourse offender.
In a six-paragraph order, Rakoff mentioned JPMorgan must face a lawsuit by the US Virgin Islands accusing it of lacking pink flags about Epstein’s abuse of ladies on Little St. James, a non-public island he owned there.
The judge additionally dominated that each banks must face proposed class actions by ladies who mentioned Epstein sexually abused them. He mentioned he would clarify his reasoning sooner or later.
Rakoff’s determination provides the plaintiffs an opportunity to show one other declare: that JPMorgan and Deutsche Bank
(DB)knowingly benefited from involvement in Epstein’s intercourse trafficking. The ladies can now additionally attempt to present that the banks had been negligent and obstructed enforcement of a federal anti-trafficking regulation.
JPMorgan spokeswoman Trish Wexler and Deutsche Bank spokesman Dylan Riddle declined to touch upon Rakoff’s ruling.
Brad Edwards, a lawyer for the ladies, mentioned damages in a scheduled October trial masking greater than 300 Epstein victims might whole billions of {dollars}.
The JPMorgan circumstances drew added consideration when Jes Staley, previously JPMorgan’s personal banking chief, was accused of swapping sexually suggestive messages about younger ladies with the financier, and committing sexual assault himself.
Epstein had been a shopper of JPMorgan from 2000 to 2013, and Deutsche Bank from 2013 to 2018.
Both banks have mentioned that they had no authorized obligation to guard ladies from Epstein and denied accusations they knew about his abuses.
“It’s a landmark decision,” Edwards mentioned in an interview.
“To my knowledge, it’s the first time a class of victims can pursue sex trafficking cases against two major financial institutions,” he added. “Complicity of the banks was a necessary ingredient of Epstein’s abuses, and this provides a final layer of accountability.”
Carol Thomas-Jacobs, the US Virgin Islands performing lawyer normal, mentioned her workplace’s case would assist make sure that banks act as “a first line of defense in identifying and reporting potential human trafficking, as the law expects.”
The territory beforehand recovered greater than $105 million from Epstein’s estate in a settlement in November, whereas in 2021 about 138 Epstein accusers had been awarded greater than $121 million from a compensation fund, additionally funded by the property.
Epstein killed himself at age 66 in a Manhattan jail cell in August 2019 whereas awaiting trial on intercourse trafficking. He had pleaded responsible to a Florida state prostitution cost in 2008, and later registered as a intercourse offender.
The lawsuits accused JPMorgan and Deutsche Bank of turning a blind eye to Epstein’s abuses as a result of he was an necessary shopper, and of letting him make quite a few wire transfers to pay victims.
In its criticism, the US Virgin Islands additionally urged that JPMorgan Chief Executive Jamie Dimon was conscious of Epstein’s crimes and the financial institution’s function in advancing them.
The plaintiff in one of many JPMorgan circumstances, often known as Jane Doe 1, mentioned she was a ballet dancer whom Epstein trafficked from 2006 to 2013.
In the Deutsche Bank case, the plaintiff, often known as Jane Doe 1, mentioned Epstein sexually abused her from 2003 to 2018.
JPMorgan is separately suing Staley for concealing what he knew about Epstein, and desires him to return eight years of pay and canopy losses within the different lawsuits.
Staley has admitted having been pleasant with Epstein however expressed remorse for the connection and denied figuring out about Epstein’s alleged crimes.
He grew to become Barclays’
(BCS)chief government after leaving JPMorgan, however resigned in November 2021 amid regulatory considerations about his relationship with Epstein.
Brendan Sullivan, a lawyer for Staley, didn’t instantly reply to requests for remark .
JPMorgan legal professionals are anticipated to query Staley underneath oath on Thursday and Friday, and Edwards mentioned he has requested Dimon to undergo questioning.