Yahoo Finance JPMorgan's Dimon not aware of 2011 warning about Jeffrey Epstein: Deposition
JPMorgan Chase (JPM) CEO Jamie Dimon said in a deposition that he was not aware of a 2011 email from one of his top deputies advising that Jeffrey Epstein "should not be a client" of the New York bank.
The email, according to a lawyer who conducted the deposition, was sent by JPMorgan general counsel Stephen Cutler to two other executives who reported directly to Dimon: asset management head Mary Erdoes and then-investment banking boss Jes Staley.
"This is not an honorable person in any way," Cutler wrote in the July 20, 2011 message, according to the lawyer conducting the deposition. "He should not be a client."
Dimon said he wasn’t aware of the message "at the time" but "I know it today."
The deposition of Dimon on Friday at JPMorgan’s headquarters in Manhattan was the first time the CEO faced a series of questions about what he knew about Epstein while the convicted sex predator was a longtime customer of the bank.
Two lawsuits from lawyers representing Epstein’s victims and the government of the US Virgin Islands have alleged JPMorgan ignored warnings about its client and facilitated his alleged sex trafficking.
The bank, in turn, has sued Staley, who got to know Epstein while running JPMorgan’s asset-management unit. JPMorgan claims Staley misled executives about Epstein. Staley’s lawyers have denied the allegations and Staley has said he never knew about Epstein’s alleged crimes.
During Dimon’s deposition, the CEO said repeatedly that he never met Epstein or talked to him. He also said he had no memory of being told anything about him by any of his executives.
The lawyer questioning Dimon showed Dimon another email sent by Cutler to Erdoes on July 21, 2011. "I would like to put it and him behind us," Cutler wrote, according to the lawyer. "Not a person we should do business with, period."
The lawyer told Dimon that Cutler, who was hired in 2006 but is no longer with JPMorgan, "testified under oath that Jes Staley and Mary Erdoes made the decision to retain Epstein as a customer of the bank."
Dimon said in response to a question that Erdoes could have decided to terminate Epstein as a client. Dimon said of Cutler that he "had the ultimate authority to kick him out if he thought it had gone too far" and that "he was delegating reputational decisions to somebody else.”
Erdoes and Cutler, Dimon added, "were both trying to do the right thing."
Epstein, who pleaded guilty in 2008 to soliciting a minor for prostitution, was released as a client of JPMorgan in 2013. Erdoes was the one who let Epstein go; she has said in a separate deposition, according to media reports, that she did so because of concerns about Epstein's large cash withdrawals.
Epstein was arrested in 2019 on child sex trafficking charges. He was later found dead in prison in an apparent suicide.
Jes and Jamie
Dimon was repeatedly asked during Friday's deposition about messages between Staley and Epstein, including one from an assistant to Epstein inquiring about food to be served for "Jes and Jamie."
He said he never had any appointments with Epstein and never went to Epstein's house or had a meal with him. Nor, he said, was he notified when Epstein was first indicted in 2006.
The Wall Street Journal has reported that Staley said in other legal documents in the case that he did discuss Epstein with Dimon in 2006 and 2008, as well as other times through 2012. JPMorgan has denied that, and Dimon said in his testimony that the first he heard of Epstein was years later.
"I recall not hearing about Jeffrey Epstein until about 2018 or sometime in 2019 when the story blew wide open," Dimon said. "He was arrested, and all the stories came out about all the people he knows."
Staley left the bank in 2013 to become CEO of Barclays. Dimon in his testimony said he asked the executive to leave partly because he "was not doing a good job of running the investment bank" and because of unauthorized comments he made to the press about trading losses in 2012.
The CEO said there is "also some evidence" that Staley tried to get him removed as head of JPMorgan amid the 2012 trading debacle that originated with bets made by an employee known as the "London Whale."
"He at one point admitted to me that he should have made that call, and he thought I'd lose my job and he could be the guy," Dimon said in his testimony.
"Which, of course, just so you know, never would have happened...he would have been asked to leave the company anyway, London Whale aside. And the board never would have put him in the job."
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