Jes Staley must face JPMorgan’s Epstein claim, judge rules

Jes Staley must face claims that he misled JPMorgan Chase about his relationship with Jeffrey Epstein after a New York decide denied the banker’s try and dismiss a lawsuit introduced by his former employer.

The 66-year-old, who spent greater than 30 years at JPMorgan earlier than being fired in 2013, was sued by the financial institution in March, looking for to make Staley accountable for any damages awarded in two separate claims over JPMorgan’s resolution to retain Epstein as a consumer for 15 years.

The lawsuits in opposition to JPMorgan had been filed in direction of the top of final 12 months, one by an unnamed Epstein accuser, and the opposite by the US Virgin Islands, the place the disgraced financier had a house.

They allege that JPMorgan benefited from human trafficking by persevering with to supply banking companies to Epstein regardless of a number of inner crimson flags about his arrest and cost for soliciting a minor in Florida, and reviews that he was utilizing money to repay intercourse abuse victims.

The Epstein accuser additionally alleged she was raped by Staley, and that Staley witnessed her being abused — claims that Staley has strongly denied.

JPMorgan mentioned that if such allegations had been true, Staley, who was for a interval Epstein’s personal banker, didn’t comply along with his fiduciary duties.

The lender additionally mentioned Staley, who vouched for Epstein throughout the financial institution, could have mischaracterised the character of his relationship with the disgraced financier, which allegedly concerned a number of visits to Epstein’s properties and emails through which images of younger ladies had been exchanged.

In communications entered into proof as a part of the circumstances in opposition to JPMorgan, Staley described himself as owing Epstein “a lot”, and said that he had few friendships as “profound”.

In addition to looking for to make Staley accountable for any damages it faces, JPMorgan can be trying to claw again a few of Staley’s pay.

Staley went on to guide Barclays financial institution in Britain earlier than resigning following an investigation into the way in which he characterised his relationship with Epstein. He has described JPMorgan’s allegations as “slanderous” and “baseless however critical”. His attorneys didn’t instantly reply to a request for touch upon Wednesday’s resolution.

Staley’s authorized group had tried to get JPMorgan’s declare dismissed, arguing that the financial institution’s case was “utterly absent” of concrete claims. 

“They should make the allegations . . . they should say what’s true and what’s not,” Staley’s lawyer Stephen Wohlgemuth informed the courtroom final week.

“This alleged vouching . . . would have been made to JPMorgan workers,” Wohlgemuth mentioned, including that the financial institution might present a full account of what occurred. “What does the financial institution say? Was there vouching? What did Mr Staley really say . . . who did he say it to and why did they depend on it?” 

JPMorgan declined to touch upon the choice. Final week, the financial institution mentioned in a press release: “Staley is accused of unspeakable acts which can be the inspiration of the claims in opposition to the financial institution. If true, he’s accountable for any hurt accomplished not simply to the financial institution, however to those ladies.”

Decide Jed Rakoff, who’s overseeing the case, mentioned he would clarify his reasoning for denying Staley’s movement to dismiss at a later date. The circumstances are scheduled to go to trial in New York in October.

If JPMorgan succeeds in its efforts to implicate Staley, the chief could possibly be accountable for thousands and thousands of {dollars} in damages. Final week, Deutsche Financial institution, which retained Epstein as a consumer for 5 years, put aside $75mn to settle a separate declare by an unnamed sufferer, on behalf of dozens of ladies.

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