Lawsuits Against Financial Institutions having Epstein Ties Could Shed New Light on Financier’s Wrongdoings

For years, survivors of the late financier Jeffrey Epstein have demanded accountability. For a while, it appeared like they would achieve it.

Ghislaine Maxwell, Epstein’s ex-girlfriend, was found guilty of human trafficking in a 2021 trial for her role in the late financier’s exploitation of teen girls – and given to two decades behind bars.

At the same time, banks that had worked with Epstein, although not admitting wrongdoing, agreed to pay substantial sums in agreements to survivors. Former President Trump even made releasing the documents related to the Epstein probe part of his election promises, and doubled down on his promise to do so in recent months.

Ultimately, the administration’s Department of Justice did not release these files, and his government has become embroiled in reports about social ties between him and Epstein. Congressional promises to release files have lagged, due to partisan maneuvering and delays from federal authorities.

But recent legal actions could provide clarity on Epstein’s operations amid the deadlock – regardless of their outcome.

Legal Actions Target Leading Financial Institutions

The legal complaints, filed by an anonymous plaintiff against Bank of America and the BNY Mellon, claim that these banking giants illicitly enabled Epstein’s trafficking ring. The suits are helmed by Sigrid S McCawley, of a prominent law firm, and lawyer Brad Edwards of Edwards Henderson, who have long represented survivors of Epstein’s abuse.

“Epstein committed these crimes by means of not only his own vast fortune and power, but through financial backing and financial support from both individuals and organizations, including BNY,” one lawsuit claims. “Egregiously, the institution had a abundance of knowledge regarding Epstein’s sex trafficking operation but opted for financial gain over protecting the victims.”

The complaint against Bank of America echoes these allegations, declaring the institution “deliberately supplied the monetary resources and the veneer of institutional legitimacy for Epstein and his accomplices to support their international sex trafficking organization under the guise of legal commercial dealings”. The suit also said the bank failed to file mandatory financial alerts.

Legal Experts Weigh In on Case Challenges

Longtime attorneys who commented on the situation said proving such a case would be difficult. But they also identified possible outcomes which could offer comfort to accusers or disclosure of long-sought information.

Attorney Neama Rahmani, a former federal prosecutor who founded West Coast Trial lawyers, said proof has to show that an institution’s actions led to harm.

“I don’t think the lawsuit has much of a chance of success – and obviously I am on the side of the victims, and I want them to get explanations and legal redress and financial recovery,” the attorney said. Certain allegations might be too tangential from a legal standpoint.

“The case hinges on proof,” he said. A lawyer would need to prove cause and effect, which would mean “but for the defendant’s conduct, the harm wouldn’t have occurred”. In this case, that would boil down to “absent the institution’s involvement, the survivor maybe wouldn’t have been exploited”, Rahmani clarified.

A lawyer would also have to go further than a “but for” measure. “It’s not solely about indirect cause. It also has to be a significant element: that is the legal test. So any improper behavior there was, if there was any misconduct … the bank’s actions has to have been a substantial factor in leading to the victim’s suffering.

“By engaging in a business relationship with Epstein, is that a substantial factor? I don’t know.”

Regardless of legal responsibility, suits like this could put institutions on notice that relationships with those involved in alleged crimes can have negative consequences for them.

“It represents a reputational disaster,” Rahmani noted. If the financial institutions try to get these cases dismissed and are unsuccessful, the attorney anticipates a quick resolution. “No one wants to go litigate any of the legal matters tied to Epstein.”

Eric Faddis, a litigator and founder of the Colorado law firm his firm and former prosecutor, said corporations can be liable. In this scenario, “whether the banks have liability is going to depend, in part, on what the banks knew, if they were informed of claimed misconduct or criminal wrongdoing”, and in some way offered support to Epstein.

“However, even in that case, I think it’s going to be difficult to sort of loop the financial entities into some kind of sex-trafficking scheme. The institutions would likely not be aware of the particulars of allegations,” Faddis said. While the financier’s prior legal case was known, “there’s no law against for a financial institution to have a client who’s an unsavory person”.

“It is illegal for a bank to in any way be complicit in the criminal activity of a client, but those two issues are very different, and so I think that it’s going to be a difficult case against the banks.”

Possible Advantages for Victims

That said, key elements of the legal proceedings could assist Epstein survivors.

“These cases may uncover additional details about the ongoing Epstein saga,” the attorney said. “Even though there have been sort of walls put up at every turn for individuals seeking this data, when there’s a legal action, there’s a evidence-gathering phase, and that legal procedure often mandates release of information that was not previously public.”

Attorney Brad Edwards said in a statement that the lawsuits could have a preventive impact and achieve what lawmakers have failed to do.

“The lawsuits are necessary for complete justice for the survivors of the financier – as well as for potential targets who will be harmed from similar trafficking organizations – if our banks are not made responsible for the essential role each performs, either in supplying the required framework for the criminal enterprise or recognizing the financial component of these crimes and putting an end to it.

He added: “We have a far better chance of effecting meaningful change than Congress, because we understand the details and background of the matter and are not driven by politics but rather by a genuine desire to create substantial impact and to safeguard the survivors, who have already endured immense pain.

“Our handling of these issues without any partisan motives and thus will not be swayed by obstructions, shielding influential figures, or the other shameful political maneuvering you and the rest of the world have had to observe recently.”

McCawley said in a statement: “While legislators attempt to uncover how Jeffrey Epstein was able to orchestrate his illegal trafficking operation for decades without being caught, we are taking a further significant action forward toward legal resolution for victims.”

Institutional Reactions

When requested for a statement on the lawsuit, BNY said: “The allegations in the case are baseless, and we will strongly contest against it.”

Bank of America’s statement likewise stated: “We intend to firmly protect our interests in this case.”