The former bank boss Jes Staley pushed JP Morgan to keep
Jeffrey Epstein as a client despite human trafficking concerns and told him
suspicious withdrawals from his account were being investigated, a court has
heard.
The Financial Conduct Authority (FCA) put the allegations to
the ex-chief executive of Barclays during his second day of witness testimony
at the upper tribunal in London.
Staley, who resigned from Barclays in 2021, is trying to
overturn the regulator’s decision to ban him from taking any senior roles in
the UK financial sector after claiming he lied about the depth of his
relationship with Epstein. Barclays declared to the regulator in a letter in
2019 that the two men “did not have a close relationship”.
Staley originally met Epstein in 2000 after he became head
of JP Morgan’s private bank, where Epstein was a client, and continued their
relationship after Staley was appointed to lead the investment bank in 2009.
The FCA’s lawyer Leigh-Ann Mulcahy KC presented the tribunal
with a series of internal emails and notes from JP Morgan bosses, who were
considering dumping Epstein as a client in 2011. The financier had been released
from prison after being convicted in 2008 of soliciting prostitution from a
minor.
In one, a senior boss in the compliance team said he had
held a meeting with colleagues “to determine how to approach the issue with Jes
Staley who is friends with Mr Epstein. He needs to understand the potential
backlash to the firm given all the work done to root out clients involved in
human trafficking”.
The court was also showed another note produced by JP Morgan
bosses which said Staley had asked the bank’s top lawyer, Stephen Cutler, to
“hear [Epstein] out”.
Mulcahy put to Staley that others at JP Morgan “appeared to
be of the view … that you were the one pushing to retain Mr Epstein as a
client”.
Staley denied the allegations saying “I don’t think that’s
fair”, adding that while JP Morgan knew the two men had a relationship, the
decision to exit a client such as Epstein was not his to make.
He admitted to putting Cutler in contact with Epstein’s
lawyer, but said that if JP Morgan’s top lawyer “had wanted to let Epstein go
as a client he had full latitude to do that and I would never stand in his
way”.
Mulcahy also accused Staley of sharing confidential
information with Epstein, particularly about how JP Morgan had concerns over
human trafficking allegations against the financier and suspicious cash
withdrawals from his account. She pointed to an email that Epstein subsequently
sent to a senior boss in the private bank in September 2011, saying “Jes told
me that there was [an issue] with reg cash with drawals [sic].”
Staley said that while he “was not part of managing the
account” he did not deny that he told Epstein there were concerns about cash
withdrawals.
Epstein died in prison in August 2019 while awaiting trial
over charges on trafficking underage girls for sex.
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