Virgin Islands Subpoenas Bank Leumi for Jeffrey Epstein's financial records

The government of the U.S. Virgin Islands is upping the ante in its quest to pierce the veil of secrecy that cloaked the life and wealth of financier Jeffrey Epstein, the deceased sex-offender who accrued a fortune of more than $650 million under mysterious circumstances.

At least ten financial institutions -- including Deutsche Bank, JPMorgan Chase and Citibank have been issued subpoenas in recent weeks from the office of USVI Attorney General Denise George, according to court filings. 

The subpoenas seek account records, transaction details and communications concerning Epstein, his estate, and more than 30 corporations, trusts and nonprofit entities connected to him.

The move comes as lawyers for Epstein's estate are locked in an increasingly acrimonious duel with George, who filed a civil forfeiture lawsuit against the estate in January, five months after Epstein died while in a federal jail in New York. 

The complaint alleges that Epstein constructed a network of companies and individuals to enable and conceal his alleged sex-trafficking of girls and young women to Little St. James, his luxurious private island resort off the east coast of St. Thomas.

"Epstein, through and in association with defendants, trafficked, raped, sexually assaulted and held captive underage girls and young women at his properties in the Virgin Islands," the suit said.

Earlier this month, the attorney general revealed in court filings that her office is also scrutinizing the alleged role of Ghislaine Maxwell in Epstein's operation. Maxwell, 58, was arrested on July 2 and charged in a federal indictment in New York. 

She is accused of grooming three minor girls and enabling their sexual abuse by Epstein between 1994 and 1997. In some cases, prosecutors allege, Maxwell participated in the abuse. She has pleaded not guilty to all the charges and a trial is scheduled for next year.

"The Government is and has been actively investigating Maxwell's participation in the criminal sex-trafficking and sexual abuse conduct of the Epstein Enterprise," wrote Ariel Smith, deputy attorney general of the USVI in a court filing on July 11.

Lawyers for Epstein's estate are seeking to dismiss the government's lawsuit as an untimely action that is interfering with the estate's ability to preserve its assets and to pay claims to its creditors, including alleged victims of Epstein's decades-long pattern of abuse. A voluntary claims restitution program established by the estate began accepting claims from survivors last month.

"Mr. Epstein is not continuing his alleged criminal enterprise, as he is dead," wrote Christopher Kroblin, an attorney for the estate in a court filing in May. "The Government sat on its hands while Mr. Epstein was alive -- notwithstanding that he registered as a sex offender with the Government ten years ago -- and continued to do nothing even months after Mr. Epstein's death," Kroblin wrote.

Epstein first acquired property in the U.S. Virgin Islands in 1998, purchasing Little St. James, an island off the east coast of St. Thomas, for about $8 million. He then spent millions of dollars developing an elaborate compound, with a main house, swimming pool, helipad and guest villas overlooking the Caribbean Sea. Starting in 2010, Epstein made the island his permanent residence and established a host of vaguely-named entities in the territory to run his business, charitable and personal affairs. He would later, through a series of separate transactions totaling more than $20 million, complete the purchase of a larger, neighboring island called Great St. James.

The source of his extravagant wealth has long defied logical explanation. Epstein grew up in a blue-collar neighborhood in Brooklyn's Coney Island, never finished college, and amassed his fortune while boasting of managing money only for billionaires -- though his only publicly-known client was Leslie Wexner, the founder of The Limited. Wexner would later accuse Epstein of misappropriating millions of dollars from his family fortune.

Among the entities listed in the USVI government's subpoenas to the banks are Plan D, which owned Epstein's Gulfstream jet; Nautilus, Inc., which owned Little St. James; and Maple, Inc., which owned his New York mansion.

Several of the financial firms are also being asked for records concerning "The Butterfly Trust," an Epstein-related entity that opened accounts at Deutsche Bank in 2014 and which listed several of Epstein's alleged co-conspirators among its beneficiaries, according to a report from New York state regulators released earlier this month.

That report found that Deutsche Bank maintained its relationship with Epstein until late 2018 despite multiple "suspicious transactions" and "red flags" that could have been related to his alleged sex-trafficking operation.

Epstein allegedly used the Butterfly Trust and various other accounts to "send over 120 wires totaling $2.65 million to beneficiaries … including some transfers to alleged co-conspirators or women with Eastern European surnames," regulators noted, as well as to make "lawsuit settlement payments to alleged victims, and rent, legal, and immigration expenses made to or on behalf of young (albeit adult) women," according to the report.

Deutsche Bank agreed to pay penalties of $150 million for compliance failures in connection with the banks dealing with Epstein, according to the New York State Department of Financial Services.

"We acknowledge our error of onboarding Epstein in 2013 and the weaknesses in our processes, and have learnt from our mistakes and shortcomings," a bank spokesperson said of the report's findings. "Immediately following Epstein's arrest, we contacted law enforcement and offered our full assistance with their investigation."

A Deutsche Bank spokesperson declined to comment on the subpoenas from the United States Virgin Islands. Representatives from JPMorgan Chase and Citibank also declined to comment.

Other banks and brokerage firms that were issued subpoenas, according to the court records, include Fidelity Investments, Charles Schwab, Bank Leumi, Wells Fargo, Northern Trust, and Silicon Valley Bank.

Spokespersons for Fidelity, Charles Schwab and Leumi did not respond to requests for comment. Wells Fargo declined to comment.

Silicon Valley Bank declined to comment on pending litigation, but a spokesperson said that "to the best of our knowledge, Silicon Valley Bank has not had, and currently does not have, any business dealings with the individual or the entities named in the subpoena."

A spokesperson for Northern Trust, Doug Holt, did not comment directly on the subpoenas but said that "like other financial institutions, Northern Trust regularly cooperates with information requests from regulators or law enforcement officials."