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JPMorgan, Deutsche Bank must face lawsuits over Jeffrey Epstein ties

JPMorgan Chase

(Reuters) — A U.S. judge said on Monday that JPMorgan Chase & Co. must face a lawsuit by the U.S. Virgin Islands accusing the bank of enabling the late financier Jeffrey Epstein’s sex trafficking.

U.S. District Judge Jed Rakoff in Manhattan also ruled that JPMorgan and Deutsche Bank AG must face lawsuits by two women who said Mr. Epstein sexually abused them, and who also accused the banks of enabling Mr. Epstein.

While dismissing some claims, Judge Rakoff said the plaintiffs in all three lawsuits can try to prove that the banks knowingly benefited from participating in Mr. Epstein’s sex trafficking venture.

He also allowed the women to pursue claims that the banks were negligent and obstructed enforcement of a federal anti-trafficking law. Judge Rakoff said he would explain his reasoning in due course.

Both banks have said they had no legal duty to protect women from Mr. Epstein and denied accusations they knew about his abuses.

JPMorgan spokeswoman Trish Wexler and Deutsche Bank spokesman Dylan Riddle declined to comment.

Lawyers for the U.S. Virgin Islands and the two women did not immediately respond to requests for comment.

Judge Rakoff’s decision means the banks could remain financially liable for their relationships with Mr. Epstein, who was a client of JPMorgan from 2000 to 2013 and Deutsche Bank from 2013 to 2018.

The U.S. Virgin Islands accused JPMorgan of missing red flags about Mr. Epstein’s misconduct on Little St. James, a private island he owned in the territory.

It has also suggested that JPMorgan Chief Executive Jamie Dimon was aware of Mr. Epstein’s crimes and the bank’s role in advancing them.

In separate lawsuits, the two women, each known as Jane Doe 1, accused JPMorgan and Deutsche Bank of turning a blind eye to Mr. Epstein’s abuses because he was an important client, and said numerous cash payments came from the banks to pay Mr. Epstein’s victims.

Jane Doe 1 in the JPMorgan case said she was a ballet dancer whom Mr. Epstein trafficked from 2006 to 2013. The Jane Doe 1 in the Deutsche Bank case said Mr. Epstein sexually abused her from 2003 to 2018. Both women are seeking class-action status.

The litigation drew added attention when Jes Staley, formerly JPMorgan’s private banking chief, was accused in the lawsuits of swapping sexually suggestive messages about young women with the financier, and committing sexual assault himself.

JPMorgan is separately suing Mr. Staley for concealing what he knew about Mr. Epstein, and seeking for him to return eight years of pay and cover losses in the other lawsuits.

A lawyer for Mr. Staley did not immediately respond to a request for comment.

Mr. Staley became Barclays PLC’s chief executive after leaving JPMorgan, but resigned in November 2021 amid regulatory concerns about his relationship with Mr. Epstein. JPMorgan lawyers are expected to question him under oath on Thursday and Friday.

Mr. Epstein killed himself at age 66 in a Manhattan jail cell in August 2019 while awaiting trial on sex trafficking charges.