A new twist appeared Wednesday in the case of the Government of the U.S. Virgin Islands v. JPMorgan Chase Bank, N.A. when bank officials singled out a former executive for alleged misconduct. A third-party lawsuit filed Wednesday is asking a New York court to make that executive pay if the V.I. government prevails in its suit alleging the bank was complicit in alleged sex trafficking by former client Jeffrey Epstein.
On Thursday, the District Court of New York, Southern District, issued a summons to former bank executive James E. Staley, at the request of the V.I. government and on behalf of a plaintiff identified as Jane Doe 1. Staley was identified in court documents as the bank official handling Epstein’s Chase Bank accounts and business transactions.
In the newly-filed complaint, bank officials charged Staley with “indemnity, contribution, breach of fiduciary duty, and breach of the faithless servant doctrine.” The complaint also claims the former executive knew about Epstein’s sexual exploitation of female victims and hid it from JPMorgan Chase’s top management.
Epstein was known as a financier and owner of an estate on Little St. James Cay in the Virgin Islands. His business dealings with JPMorgan Chase spanned from 2000 to 2013. Epstein died in a Manhattan detention center in August 2019 shortly after federal authorities arrested and charged him with sex trafficking. The cause of death, an apparent suicide.
Some of the details of the relationship between Epstein and Saley were revealed in the charging documents filed in November. Jane Doe 1, who says she was a victim of Epstein’s misdeeds from 2006 to 2013, sued the bank on Nov. 24. The V.I. Department of Justice filed its case in late December. Both parties claim that the bank knew Epstein was engaged in wrongdoing and benefited financially from continuing the business relationship.
The original complainant said she was suing for herself and “all others similarly situated,” citing New York laws and the federal Trafficking Victims Protection Act.
Jane Doe 1 also said she was assaulted by Epstein on several occasions “in New York, Florida, New Mexico, and the United States Virgin Islands.”
Wednesday’s legal filings on behalf of the bank differ from its stance in previous motions. Former V.I. Attorney General Denise George said Justice sought to recover money Epstein received through the government’s economic development program. V.I. Justice also accused bank officials under local racketeering laws as participants in Epstein’s criminal enterprise.
In early February, lawyers for the bank called the V.I. government’s case unfounded and asked for a dismissal.
However, lawyers for the bank did not seek to dismiss the original complaint, although it says the allegations listed there are unproven. “To be clear, JPMC does not admit those allegations, denies all liability, and disputes both Doe’s and USVI’s right to recover under the law from JPMC,” court documents say.
The two cases were consolidated for pretrial purposes by District Court Judge Jed Rakoff.
The summons issued Thursday from New York’s Southern District Court informs the defendant that he was named in a lawsuit filed by JPMorgan Chase Bank, N.A.. The document included an advisory that the bank may recover from him all or part of any amount the bank is ordered to pay if the court awards damages to the plaintiffs.
The next hearing in the case is scheduled to take place in New York on March 16.