Latest / The Vault: The Epstein Files / The USVI And Their Motion For Partial Summary Judgement Against JPMorgan (Part 6) (9/20/26)

Transcript

The USVI And Their Motion For Partial Summary Judgement Against JPMorgan (Part 6) (9/20/26) · The Vault: The Epstein Files

• 0:00
  Speaker 1: What's up everyone, and welcome back to the Epstein Chronicles.
• 0:04
  Speaker 1: In this episode, we're getting back to the USVI and
• 0:08
  Speaker 1: their request for a partial summary judgment against J.P. Morgan. 2.
• 0:13
  Speaker 1: The discretionary act of granting a waiver of notification periods
• 0:17
  Speaker 1: for overseas travel is not grounds to shift fault to
• 0:21
  Speaker 1: the government. Following his conviction in Florida, Epstein was required
• 0:25
  Speaker 1: to register as a sex offender with the Virgin Islands
• 0:28
  Speaker 1: Department of Justice. In 2012, the legislature amended its sex
• 0:33
  Speaker 1: offender laws in part to obtain federal funding for its
• 0:36
  Speaker 1: sex offender unit. The U.S. government approved the changes to
• 0:40
  Speaker 1: the law in advance. J.P. Morgan is sought to make
• 0:42
  Speaker 1: hay of the fact that Epstein's attorneys consulted with lawmakers
• 0:46
  Speaker 1: concerning the proposed changes, but those arguments prove nothing. The
• 0:50
  Speaker 1: legislature rejected Epstein's proposed changes. The amended statute required that
• 0:55
  Speaker 1: all sex offenders required to register in this jurisdiction shall
• 0:58
  Speaker 1: appear in person at the Department of Justice at least
• 1:02
  Speaker 1: 21 calendar days prior to any intended travel outside of
• 1:05
  Speaker 1: the United States and provide information about their intended travel
• 1:09
  Speaker 1: as provided. The same provision then states that the Attorney
• 1:13
  Speaker 1: General may, at his discretion, reduce this 21-day notice requirement
• 1:17
  Speaker 1: if a sex offender requests such a reduction and provides
• 1:20
  Speaker 1: information in support of his request. Other statutory provisions confirm
• 1:25
  Speaker 1: that nothing under this chapter shall be construed as a
• 1:27
  Speaker 1: waiver of sovereign immunity for the United States Virgin Islands,
• 1:31
  Speaker 1: its departments and agencies. Epstein applied for and received a
• 1:35
  Speaker 1: discretionary waiver of his travel notification requirements pursuant to these
• 1:40
  Speaker 1: statutory provisions, but this waiver does not constitute misconduct or
• 1:44
  Speaker 1: otherwise from the basis of a valid affirmative defense. The
• 1:48
  Speaker 1: provision of streamlined travel notice requirements upon satisfactory proof is
• 1:53
  Speaker 1: statutorily mandated and or vested in the Attorney General's discretion.
• 1:58
  Speaker 1: Case law is clear that such discretionary actions do not
• 2:01
  Speaker 1: support shifting fault to the government. The defense fails as
• 2:04
  Speaker 1: a factual matter as well. The statutory waiver of which J.P.
• 2:08
  Speaker 1: Morgan complains applied only to international travel. While the government
• 2:12
  Speaker 1: had a policy in place to require notification of travel
• 2:15
  Speaker 1: outside of the territory but within the United States, Nothing
• 2:19
  Speaker 1: in the federally approved Virgin Islands statute required such notification,
• 2:22
  Speaker 1: nor did this provision of such a waiver somehow enable
• 2:25
  Speaker 1: Epstein's crimes. Testimony is clear that Epstein never failed to
• 2:29
  Speaker 1: register as a sex offender, and there is no evidence
• 2:32
  Speaker 1: that he failed to notify of travel. There is no
• 2:35
  Speaker 1: evidence that permitting Epstein to email his international travel notifications
• 2:39
  Speaker 1: 24 hours in advance instead of appearing in person 21
• 2:42
  Speaker 1: days in advance somehow enabled him more latitude to commit
• 2:46
  Speaker 1: his crimes. Notifications are not authorizations or requests. The government
• 2:51
  Speaker 1: has no ability to restrict his travel. Moreover, entry into
• 2:55
  Speaker 1: the territory from overseas is controlled by federal authorities, not
• 2:59
  Speaker 1: the Virgin Islands government. Any attacks on the granting of
• 3:02
  Speaker 1: the waiver itself are meritless. Then Attorney General Frazier testified
• 3:06
  Speaker 1: that he relied on representations of Epstein's counsel in forming
• 3:09
  Speaker 1: his decision, and that those representations were satisfactory to conclude
• 3:14
  Speaker 1: that there was not an undue risk to the community.
• 3:17
  Speaker 1: that would arise from the waiver. Epstein's lawyers represented to Mr.
• 3:21
  Speaker 1: Frazier that other states permitted Epstein to provide email notification
• 3:24
  Speaker 1: of his travels and affirmed that there is no public
• 3:27
  Speaker 1: safety necessity in requiring Epstein to notify the department in
• 3:31
  Speaker 1: person each time he travels to and from the jurisdiction. J.P.
• 3:35
  Speaker 1: Morgan's defense thus rests not on whether the decision was
• 3:38
  Speaker 1: authorized under law, it most certainly was, but on whether
• 3:42
  Speaker 1: the Attorney General in 2012 exercised sufficient discretion in granting
• 3:46
  Speaker 1: the waiver. This is precisely what case law cited above precludes.
• 3:51
  Speaker 1: Government officials performing discretionary functions generally are shielded from liability
• 3:56
  Speaker 1: or civil damages insofar as their conduct does not violate
• 3:59
  Speaker 1: clearly established statutory or constitutional rights of which a reasonable
• 4:04
  Speaker 1: person would have known. B. J.P. Morgan's defenses are barred
• 4:08
  Speaker 1: as applied to the Economic Development Commission grant of tax
• 4:11
  Speaker 1: benefits to Epstein's companies. The EDC operates under the umbrella
• 4:16
  Speaker 1: of of the USVI Economic Development Authority, which is a
• 4:20
  Speaker 1: semi-autonomous instrumentality of the government, and is governed by a
• 4:24
  Speaker 1: board of individuals appointed by the governor. Virgin Island Code 29,
• 4:29
  Speaker 1: Section 1101A. The EDA is a public corporation having legal
• 4:33
  Speaker 1: existence and personality separate and apart from the government of
• 4:37
  Speaker 1: the Virgin Islands and the officers controlling it. Thus, to
• 4:41
  Speaker 1: the extent J.P. Morgan conflates entities and treats EDC actions
• 4:45
  Speaker 1: as attributable to the government, see MTS, Opposition Act 2,
• 4:49
  Speaker 1: its arguments find no support in Virgin Islands law. The
• 4:53
  Speaker 1: tax benefits are authorized by a federal statute pursuant to
• 4:56
  Speaker 1: which the EDC administers a unique economic development program for
• 5:01
  Speaker 1: the USVI, allowing residents of the territory to exempt certain
• 5:05
  Speaker 1: income if it's connected with the conduct of a trade
• 5:08
  Speaker 1: or business within the Virgin Islands. The substance and procedures
• 5:12
  Speaker 1: for the EDC's provision of tax benefits are set by
• 5:15
  Speaker 1: statute and regulation. It's the policy and determination of the
• 5:19
  Speaker 1: government of the Virgin Islands that certain industrial development benefits
• 5:23
  Speaker 1: should be made available for development and expansion of such
• 5:27
  Speaker 1: industrial or business activities as are determined pursuant to this
• 5:31
  Speaker 1: subchapter to be in the public interest by advancing the growth, development,
• 5:35
  Speaker 1: and or diversification of the economy of the territory of
• 5:38
  Speaker 1: the Virgin Islands. The factual record bears this out. The
• 5:42
  Speaker 1: EDC granted incentives to two of Epstein's companies, Financial Trust
• 5:46
  Speaker 1: Company and Southern Trust Company. The first grant of benefits
• 5:49
  Speaker 1: to an Epstein-owned company occurred in 1999 to Financial Trust.
• 5:55
  Speaker 1: In 2009, Financial Trust applied for and received an extension
• 5:58
  Speaker 1: of benefits. Epstein formed a new company, Southern Trust, which
• 6:02
  Speaker 1: applied for and received tax benefits in 2012. In each
• 6:06
  Speaker 1: of those cases, the grant of benefits was performed in
• 6:09
  Speaker 1: compliance with all statutory and regulatory procedures and requirements. The
• 6:15
  Speaker 1: companies submitted applications for the benefits. EDC held public hearings
• 6:19
  Speaker 1: during which the benefits were discussed and the applicants were
• 6:22
  Speaker 1: provided the opportunity to present their case and answer questions.
• 6:27
  Speaker 1: The EDC then held decision meetings where the board considered
• 6:30
  Speaker 1: the applications and rendered decisions. To the extent that J.P.
• 6:34
  Speaker 1: Morgan questions the reasoning behind those decisions, that's precisely the
• 6:38
  Speaker 1: type of second-guessing the law precludes. Once benefits are granted,
• 6:42
  Speaker 1: Virgin Island law limits the EDC's ability to modify them.
• 6:46
  Speaker 1: The Commission may not require an applicant to meet qualifications
• 6:50
  Speaker 1: or requirements in excess of those representations made by the
• 6:53
  Speaker 1: applicant to the Commission during the application process as a
• 6:57
  Speaker 1: condition of granting an initial certificate. Indeed, the law specifies
• 7:01
  Speaker 1: that benefits granted are considered as being the nature of
• 7:05
  Speaker 1: a contract between the government and the beneficiary. The EDC
• 7:09
  Speaker 1: could not revoke, suspend, or modify the benefits based upon
• 7:12
  Speaker 1: a felony conviction unless it concerned conduct connected with the
• 7:15
  Speaker 1: operation of the beneficiary's business or industry. Thus, Epstein's Florida
• 7:20
  Speaker 1: conviction was not grounds for revocation at that time because
• 7:24
  Speaker 1: no evidence was available to the EDC that Epstein's solicitation
• 7:28
  Speaker 1: of a minor for prostitution in Florida was connected with
• 7:31
  Speaker 1: the operation of his USVI businesses. Unlike JP Morgan, the
• 7:35
  Speaker 1: EDC did not have access to Epstein's company's daily financial
• 7:39
  Speaker 1: transactions and was not aware of any connection between his
• 7:42
  Speaker 1: conduct and the operation of his businesses. Indeed, the EDC
• 7:47
  Speaker 1: reached out to Epstein's attorney in January of 2015 to
• 7:51
  Speaker 1: inquire whether media reporting regarding allegations of misconduct had any
• 7:55
  Speaker 1: connection to the business of Epstein's Southern Trust Company. His
• 7:58
  Speaker 1: attorney responded to confirm, we do not believe that these
• 8:01
  Speaker 1: media discussions will have any impact on the business activities
• 8:05
  Speaker 1: of STC. J.P. Morgan has pointed to a cost-benefit ratio
• 8:09
  Speaker 1: that purportedly shows in many years that the territory, not
• 8:13
  Speaker 1: the government, received less in benefits than it gave up
• 8:16
  Speaker 1: in tax revenue. Fact-witness testimony, however, shows this analysis to
• 8:21
  Speaker 1: be irrelevant because it uses an artificial baseline. A long-tenured
• 8:26
  Speaker 1: EDC employee who was personally involved in the granting of
• 8:29
  Speaker 1: benefits testified that the ratio doesn't give the full picture
• 8:33
  Speaker 1: and can be misleading because unless the business already operated
• 8:36
  Speaker 1: in the territory, the government would not receive the tax
• 8:39
  Speaker 1: revenue in the first place and has not lost anything.
• 8:42
  Speaker 1: The analysis applies to both the initial grants of benefits
• 8:47
  Speaker 1: to both companies and to financial trust extension requests. During
• 8:50
  Speaker 1: a March 2009 public hearing, Epstein's attorney explained that a
• 8:54
  Speaker 1: denial of an extension would likely cause a responsible business
• 8:58
  Speaker 1: person to seriously consider relocating the business. If another territory
• 9:02
  Speaker 1: offered similar benefits, thus the EDC could not assume that
• 9:06
  Speaker 1: it would collect Epstein's tax revenue if the benefits were
• 9:09
  Speaker 1: not extended. The ratio further ignores ancillary benefits that accrue
• 9:14
  Speaker 1: to the territory from the presence of high net worth
• 9:17
  Speaker 1: individuals who engage in economic activity unrelated to their business
• 9:21
  Speaker 1: that benefits the territory. C. J.P. Morgan has no viable
• 9:25
  Speaker 1: defense based on activity of Cecile de Jong. J.P. Morgan
• 9:29
  Speaker 1: also argues that the activity of Cecile de Jong, former
• 9:33
  Speaker 1: First Lady of the U.S. Virgin Islands and office manager
• 9:35
  Speaker 1: of Epstein, supports its defenses. As First Lady Miss de Jong,
• 9:41
  Speaker 1: had no statutory or regulatory authority, Ms. Dijon confirmed that
• 9:45
  Speaker 1: there's no office of the First Lady with a budget,
• 9:47
  Speaker 1: and she did not have an office. First Lady was
• 9:50
  Speaker 1: largely a ceremonial position that entailed giving speeches and attending
• 9:54
  Speaker 1: social events. Moreover, the factual record shows that during the
• 9:58
  Speaker 1: time that her husband was governor, Ms. DeJong was widely
• 10:01
  Speaker 1: known and recognized to be employed by Epstein's business and
• 10:05
  Speaker 1: acting on their behalf. Unlike the information that J.P. Morgan redacted,
• 10:10
  Speaker 1: DeJong's employment with Epstein was widely reported and numerous witnesses
• 10:14
  Speaker 1: confirmed that they were familiar with her employment. Most importantly, Ms.
• 10:18
  Speaker 1: DeJong had no responsibility for governmental decisions that formed the
• 10:22
  Speaker 1: basis of J.P. Morgan's flawed affirmative defenses. She had no
• 10:27
  Speaker 1: contact with the Department of Justice personnel responsible for sex
• 10:30
  Speaker 1: offender registration and monitoring. Decisions concerning tax benefits were made
• 10:35
  Speaker 1: by the EDC's board members. Although the law at the
• 10:38
  Speaker 1: time required the governor, her husband, to sign tax benefit certificates,
• 10:42
  Speaker 1: that process was a formality and could not happen without
• 10:45
  Speaker 1: the EDC's recommendation in the first place. Ms. DeJong denied
• 10:50
  Speaker 1: knowing about or facilitating Epstein's crimes in the Virgin Islands.
• 10:54
  Speaker 1: Although J.P. Morgan has pointed to emails about arranging an
• 10:57
  Speaker 1: ESL class for women in the Virgin Islands, Ms. DeJong
• 11:00
  Speaker 1: testified that she was not aware. These individuals were potential
• 11:04
  Speaker 1: trafficking victims and documents make clear that the university merely
• 11:08
  Speaker 1: agreed to offer an existing class for them. Although Ms.
• 11:12
  Speaker 1: DeJong's emails may have provided salacious fodder for J.P. Morgan,
• 11:16
  Speaker 1: she ultimately was not responsible for any government decisions. Conclusion.
• 11:21
  Speaker 1: For the foregoing reasons, the court should grant the government's
• 11:24
  Speaker 1: motion for partial summary judgment. This was signed by Ariel Smith,
• 11:28
  Speaker 1: the Attorney General, and it was dated July 24th, 2023.
• 11:34
  Speaker 1: All right, so that wraps this document up in its entirety,
• 11:37
  Speaker 1: and we'll just keep it moving. And considering the amount
• 11:40
  Speaker 1: of documents we still have to go through, our journey
• 11:43
  Speaker 1: has just begun. All of the information that goes with
• 11:47
  Speaker 1: this episode can be found in the description box.