Former JPMorgan executive Staley rejects bank's Jeffrey Epstein accusations

[June 08, 2023]  By Jonathan Stempel

NEW YORK (Reuters) - The former JPMorgan Chase & Co executive accused of shepherding the bank's relationship with Jeffrey Epstein formally denied involvement in the disgraced financier's sex trafficking, and blamed JPMorgan for keeping him as a client.

In Wednesday night filings in Manhattan federal court, Jes Staley said his dealings with Epstein were not the "proximate cause" of any damages JPMorgan might incur in two lawsuits it faces over its work with Epstein, a client from 1998 to 2013.

Staley, who has denied wrongdoing and expressed regret for befriending Epstein, said he did not know Epstein would coerce young women and girls into having sex, or that anyone under 18 would be pressured into sex.

He also said JPMorgan had "unclean hands" for its own faults in dealing with Epstein, and that the largest U.S. bank waived at least some claims against him by keeping him on the payroll "after learning of his alleged misconduct."

JPMorgan declined to comment on the filings.

Epstein died in a Manhattan jail in August 2019 at age 66 while awaiting trial on sex trafficking charges. New York City's medical examiner called the death a suicide.

Staley's denials were expected, and contained in "answers" to New York-based JPMorgan's effort to blame him for entangling it with Epstein.

Now 66, Staley led JPMorgan's asset management business from 2001 to 2009 and its investment bank from 2009 to 2013. He was also Barclays Plc's chief executive from 2015 to 2021.

JPMorgan faces a proposed class action by women who accused Epstein of sexual abuse, led by a former ballet dancer known as Jane Doe 1, and a lawsuit by the U.S. Virgin Islands, where Epstein allegedly abused women on a private island he owned.

Barclays' CEO Jes Staley arrives at 10 Downing Street in London, Britain january 11, 2018. REUTERS/Peter Nicholls

The bank also wants Staley to forfeit his pay from 2006 to 2013, estimated in the tens of millions of dollars.

Jane Doe 1 has also alleged that one of Epstein's friends sexually assaulted her. JPMorgan later said Staley was that friend. Staley has called that accusation "baseless."

On May 24, U.S. District Judge Jed Rakoff in Manhattan rejected Staley's bid to dismiss JPMorgan's complaints. The judge has yet to explain his reasoning.

Staley is expected to testify under oath in a June 10 deposition.

In a May 26 deposition, JPMorgan Chief Executive Jamie Dimon said he had barely heard of Epstein before the financier's July 2019 arrest. Dimon also repeatedly denied having spoken with Staley about Epstein.

A trial covering all of the lawsuits is scheduled for Oct. 23.

The cases in the U.S. District Court, Southern District of New York are: Jane Doe 1 v JPMorgan Chase & Co, No. 22-10019; Government of the U.S. Virgin Islands v JPMorgan Chase Bank NA, No. 22-10904; and JPMorgan Chase Bank NA v Staley, in Nos. 22-10019 and 22-10904.

(Reporting by Jonathan Stempel in New York; Editing by Robert Birsel)

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