JPMorgan Chase is suing Jes Staley to hold the former executive responsible for any damages stemming from lawsuits accusing the bank of facilitating Jeffrey Epstein's sex-trafficking.
The bank on Wednesday filed
JPMorgan also brought separate claims against Staley for breaching his duty of loyalty to the bank. Because of his "faithless service," the bank said it was entitled to recover all compensation paid to Staley between 2006 and 2013 — a figure likely surpassing $80 million.
Staley's duty to JPMorgan required him "to refrain from activities that he knew would damage JPMC, either financially or reputationally," the bank said, "and to report to JPMC any facts or knowledge relevant to his duties that could affect JPMC's reputation or that was relevant to JPMC's decisions to retain a client whose business with JPMC might damage that reputation."
A lawyer for Staley declined to comment on Wednesday night. Staley, 66, who went on to become Barclays CEO but stepped down in 2021 following a U.K. regulatory probe into his Epstein ties, has previously denied involvement in Epstein's sex-trafficking.
The close ties between Staley and Epstein have been at the core of two suits claiming the bank knew or should have known about Epstein's crimes and kept him on as a client anyway. But Staley himself was not named as a defendant in either a proposed class action brought by Epstein victims or a separate lawsuit brought by the U.S. Virgin Islands.
JPMorgan stressed in its filing that it was still denying the claims in both suits against it. The bank has moved to dismiss both suits and is set to argue its motions on Monday before U.S. District Judge Jed Rakoff in Manhattan.
Both the victims' suit, filed by a Jane Doe plaintiff, and the U.S. Virgin Islands allege JPMorgan facilitated Epstein's crimes by allowing him to use his bank accounts to finance his sex trafficking operation, but the bank contends the suits don't adequately allege that it had knowledge of its client's illegal activity.
The Doe suit alleged that Staley "personally observed" Epstein's sexual abuse on a number of occasions. Unsavory emails between Staley and Epstein, including photos of women and references to Disney princesses, were recently cited in the US. Virgin Island's suit, revealing the depths of the banker's relationship with the sex offender.
'Staley is this person'
JPMorgan has argued that none of those allegations show that Staley and therefore the bank knew Epstein was engaged in sex-trafficking. But, strikingly, the bank on Wednesday seemed to suggest it believed Staley may have committed sexual assault.
The bank noted that the Doe plaintiff described "a powerful financial executive" whom Epstein had given permission to do whatever he wanted with her. The executive "used aggressive force in his sexual assault of her," Doe alleged.
"Upon information and belief, Staley is this person," JPMorgan said.
In its filing, JPMorgan said Staley failed to report his conduct with Epstein and misleadingly vouched for Epstein's good character. On the basis of the allegations, Staley misrepresented the true facts of his personal interactions with Epstein, the bank added.
"Instead, if the allegations of Doe and the USVI are true, Staley repeatedly abandoned the interests of JPMC and served his own and Epstein's interests," JPMorgan said.
Staley worked at the bank in various positions between 1979 and 2013, rising to the level of CEO of JPMorgan's corporate and investment banking division.
Doe alleged that Staley promised to "use his clout within JPMorgan to make Epstein untouchable" and thwarted the bank's efforts to sever ties with him.
On the basis of Doe's and U.S. Virgin Island's allegations, Staley's disloyalty occurred "repeatedly, lasted for years and persisted despite numerous opportunities to correct them," the filing stated.
Staley was known to have exchanged upwards of 1,200 emails with Epstein over the years.
In one email, filed in the U.S. Virgin Islands suit, Staley appeared to write Epstein from the latter's villa in the U.S. territory on November 2009. At the time, Epstein was under home confinement in Palm Beach, Florida, following his release on charges of soliciting a minor for prostitution but allowed to travel to New York to meet with his lawyers.
"Presently, I'm in the hot tub with a glass of white wine," he wrote. "This is an amazing place. Next time, we're here together. I owe you much. And I deeply appreciate our friendship. I have few so profound."
According to a December 2009 email, Staley got his desired reunion.
"I realize the danger in sending this email," Staley allegedly wrote. "But it was great to be able, today, to give you, in New York City, a long, heartfelt, hug."
JPMorgan has argued that the "inappropriate" emails and visits also didn't fall within the scope of Staley's job or show that he had knowledge of crimes that can be imputed to JPMorgan, the bank submitted.
The bank cut ties with Epstein in 2013.
