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So it appears that JP Morgan may have allowed Jeffrey Epstein to continue using their financial services, so of course the Times leads with the most bombastic possible version of this claim. One could imagine an alternative headline like How JPMorgan Conducted its Usual and Customary Business. Probably there are intermediate versions of this headline that are closer to neutral.
Headlines aside, right wing media is picking it up because all the Epstein stuff draws lots of clicks but I'm wondering (and hopefully I'm not alone) whether this is fundamentally about getting upset when banks don't drop unpopular clients even when their relationship has nothing to do with the clients' bad behavior.
That is to say, contra the Times, JPMorgan didn't enable Epstein's crimes in anything but the most useless sense of the world. Sure, he used money from the banks to pay people -- but I'm sure lots of criminals withdraw money from a Chase ATM in the commission of a crime, which hasn't (till recently) been laid on the bank.
The other claim is that his friends in the bank intervened when some transactions were flagged (for what, no one really explains) but this only deepens the original question: even if he was guilty of sex crimes, that doesn't imply that his financial dealings weren't in order. It's not money laundering or fraud to pay for underage hookers -- it's child prostitution which is illegal in its own right.
Ultimately where this seems to end is back to a place where banks rightly fear that they are gonna be next on the Times' hitlist because they didn't drop a client fast enough.
There's a big difference between the ordinary JPM customer who has an account with $5,000 in it and who barely interacts with anyone at the bank, and a high net worth client who has private bankers and gets personal attention from higher ups.
Saying those are the same is like equating purchasing Nike shoes with being sponsored by Nike. Or wearing a Cartier watch with being provided a custom Cartier watch at reduced price for promotional reasons. If the Charlie Kirk assassin wears a suit from Polo, I don't know that anyone will notice.
JPM didn't just let Epstein open a checking account at a branch without anyone being aware of it. They extensively courted, discussed, facilitated Epstein's business at the bank.
I also don't think that we've ever gotten a really good explanation for where Epstein's money came from. @2rafa et al put it as "Epstein got an extraordinary deal with Les Wexner and got all his money from there and he didn't have any other clients and case closed." But no one ever puts Epstein in a class of similar people. To my knowledge, there is no class of similar people, there are no other cases that are remotely similar. No other billionaire gave all his money to one rando with no real qualifications and made that guy a billionaire for no apparent reason. No other billionaire signed power of attorney over to some guy. Despite a plethora of gay billionaires, no one ever signed everything over to his boy toy. So "Epstein got all his money from Les Wexner" isn't really a conversation ender to me, it's the start of another more interesting mystery.
Sure. My claim wasn't that he's treated like me, only that JPM was customarily in the business of private banking HNW individuals. That's one of the services that they offer in their normal and usual course of business.
Sure, but did they do so in a way that was different from other similar private banking clients? Did he use those services in specifically criminal ways (beyond using money from their bank to pay for criminal acts, which is not sufficient grist) such as using it to launder money or commit fraud? As far as I understand, the answer to both of those questions is no.
Indeed, and I think that deserves its own thread that is independent of whether we should blame the bank for not cutting him off.
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There is plenty of evidence regarding Wexner, but because he is still alive, un-charged and very, very rich, and because much of it is hearsay, it is rarely laid out explicitly. In any case, it is hardly unsurprising for even extremely sophisticated, highly intelligent investors to be duped, seduced (platonically) by charismatic con men and adventurers for fortune, and Epstein was both. Here’s a great story about one of the most sophisticated, intelligent fund managers of the last twenty years getting conned by an already-notorious conman just because he was charismatic. And the victim in the above story, unlike Wexner, was actually in finance. Madoff had plenty of intelligent victims. Wexner didn’t even ‘lose’ his or his clients’ money unlike the above, he just made less than he might otherwise have. There are countless private bankers, macro hedge fund managers and late stage VCs who likewise spent the last 15 years (and the 1990s before them) getting fat off the bull run with minimal effort other than client relationship management.
This is before you go into the other aspects of the case, like Wexner’s previously confirmed bachelorhood and various 80s and 90s NYC rumors that are hard for any legitimate journalist to discuss without getting sued. (Nick Denton, who is obviously gay and was in the NYC scene through the 90s, hinted toward it many years ago).
Do we have other examples of billionaires signing over power of attorney to their finance guys?
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Isn't there some insane stat about how a vast majority of managed funds do worse than the S&P 500?
Yes, in generally virtually none of the managed/hedge funds outperform the S&P 500, but thats not the point of most of them. Their point is to offer returns uncorrelated with how the S&P500 is doing, hence the term "hedge". In the long run, having a portion of your assests sufficiently diversified from the rest will return higher overall yields.
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Just reading the barebones Wikipedia article on Epstein, it seems to be a combination of:
(1) Guy was charismatic in some way, he managed to charm a lot of people; he seems also to have been smart, with talents in music and maths.
(2) He had some amazing luck at the beginning - he managed to get a teaching gig in a private school that was run on sort of hippy-dippy principles (which meant he could get a job there where a conventional school wouldn't have hired him due to lack of credentials, and again seemingly by managing to charm the guy in charge) and one with a ton of well-heeled and connected parents, and he worked those connections as hard as he could (before getting bounced from the school for perhaps being a leetle too friendly with the girl students).
(3) By virtue of those connections, he wangled a job at Bear Stearns. This gave him vital exposure to the world of high finance, experience, and more networking/connections he could later call on (again, he seems to have been able to manage the high-wealth clients well, which would involve being able to create a personal relationship with them: "Jimmy Cayne, the bank's later chief executive officer, praised Epstein's skill with wealthy clients and complex products.")
(4) After being let go from Bear Sterns, he set up his own consulting firm and managed to position himself where he worked with/on behalf of wealthy, connected, and important people. Connections, connections, connections: this seems to really have been Epstein's strength.
(5) Gets hired on by another guy for a firm that morphs into a corporate raider and when this all explodes later on, he managed to walk away without criminal charges for investor fraud. Another combination of luck, talent, and charm.
(6) Set up his own financial management firm while working at (5), and once more his luck meant he landed a really big fish. Indeed, one might even say, a whale. Was indeed competent at the job and sorted out the finances, which means more trust, more personal relationship, more connections. Not to be diagnosing someone when I have no information but it honestly does seem like the guy was deeply closeted gay and so gave over way more control over his finances to Epstein than would have been usual. Epstein used this opportunity to make hay, and while he seems to have been smart enough not to kill the golden goose by robbing him blind, he was able to more or less act as if the wealth was all his (" In July 1991, Wexner granted Epstein full power of attorney over his affairs. The power of attorney allowed Epstein to hire people, sign checks, buy and sell properties, borrow money, and do anything else of a legally binding nature on Wexner's behalf").
Epstein made a tidy fortune managing Wexner's affairs, worked his connections with other wealthy people to the maximum, and was careful to keep up his old networking with figures in Bear Sterns and elsewhere, plus he seems to have been genuinely capable with money (so long as he could resist any temptations to get involved in dodgy deals). So how wealthy was he really, as aside from appearances? Probably nowhere near as much as he liked to let on, but in those circles appearances are what count (see other stories of successful cons of the rich and famous by someone pretending to be part of that environment).
It's absolutely amazing to me that you quoted my question, then regurgitated the same talking points I said I wasn't convinced by. This explanation just papers over all the weird stuff by saying "IDK he was really charismatic or something."
But unless Epstein was literally the most charismatic man of all time, there's a lot of charismatic people out there, but Epstein's arrangements were extraordinary. There's no other examples I've ever seen of a billionaire handing over PoA to his finance guy, when it comes up the normal tone industry people use about it is that it's shocking and they never saw anyone else do that. Maybe Wexner was gay, but once again, we don't have any other examples of wealthy gay men getting conned at this scale by a man who, however handsome, didn't even live with Wexner and must have been much too busy to schtupp him very often.
You just pass over every extraordinary and weird aspect of Epstein's life by saying he was charismatic or gay. Ok, there are a lot of charismatic gay men out there, yet there's only one Epstein.
This reminds me a lot of Reza Aslan's biography of Jesus, Zealot, in that Aslan constantly used historical accounts of other Jewish messiahs and assumed Jesus must have been exactly the same as them. Except that, you know, Jesus was different. You can tell because his name and his likeness are everywhere, and the other Jewish messiahs are mostly only remembered in reference to Jesus.
I think Epstein was charming, in that con artist way, because he seems to have had a track record of convincing people to give him a break, to get him introductions to jobs, to let him manage their money, etc. It wasn't just Wexner, he was just the biggest fish Epstein hooked.
The whole reason Epstein is such a big deal is because he had a laundry list of famous contacts, which has now blown up as the alleged paedophile/underage sex scandal. How did he get all those people to come to his parties, let him meet them in their own environments, fly out on his plane to his island? Yeah, Ghislaine Maxwell probably was very helpful in getting access to the likes of Prince Andrew, but Epstein had established himself already when he met her. He was charming, he was plausible, he seemed to have money or connections to money.
You can theorise all you like about "he must have been run as an intelligence agent by some agency or government that set it all up for him" but that alone won't do it; nobody is going to Jim The Spy's party if Jim is boring and dull.
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You don't have to be the most charismatic man in the world, you just need to find the one person who thinks you are. It's a pretty fine distinction but most yucks are somebody's yum, we've all seen incredibly mismatched couples and so on.
Right, and @FiveHourMarathon says there’s no precedent. There are examples of billionaires handing over their fortune to be managed by others, although the small number of billionaires and fact that these kinds of private financial affairs would usually never be reported on unless there was either a famous legal case or high profile scandal / crime surrounding the arrangement affects visibility.
But if you look more generally, Epstein had been around super rich people to some extent for more than ten years when he met Wexner in the 80s. He had met a large number. All he needed was one. And he had a very good record of charming rich people. He charmed Ace Greenberg as a teacher. He charmed Bear Stearns’ rich clients. He was very good at charming even wealthy women, obviously.
Lauren Sanchez married one man who became a billionaire, then seduced (as a middle-aged woman!) one of the richest men in the world, convinced him to leave his wife in an extremely costly divorce, had herself made the figurehead of his yacht, and got a nine figure wedding out of it all. In total she cost Bezos dozens of times what Epstein made from Wexner.
99.9th percentile charisma people exist, you’ve probably met one or two. Most are harmless and most of the harmful ones are relatively powerless, but coupled with intelligence a few standard deviations above the norm and extreme personal ambition (as noted by Greenberg and others) and what Epstein is alleged to have done with Wexner really isn’t so impossible.
I am reminded of a supposed fact about scammers - that they will often have deliberate inconsistencies, typos, and so on because it helps them not waste time. They filter out the people who will notice and ask questions.
To me this seems absurd, who would fall for that?
But people do, and the mechanisms of that don't always match our intuitions.
See: Lauren Sanchez, as you mention.
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