EFTA00162250 Case 1:22-cv-10019-JSR Document 36-1 Filed 01/13/23 Pa ## Exhibit 1 To Plaintiff, Jane Doe’s Amended Complaint against JPMorgan Chase Bank, N.A. EFTA00162251 C6ses4:222c100904SBRDDocument36-6-1 Filed 01/13/23 Page 2 of 343 # UNITED STATES DISTRICT COURT FOR THE SOUTHERN DISTRICT OF NEW YORK
GOVERNMENT OF THE UNITED)
STATES VIRGIN ISLANDS)
PLAINTIFF, JPMORGAN CHASE BANK, N.A. ) DEFENDANT. ) Case Number: 1:22-cv-10904 JSR ACTION FOR DAMAGES JURY TRIAL DEMANDED ## FIRST AMENDED COMPLAINT AND DEMAND FOR A JURY TRIAL Plaintiff Government of the United States Virgin Islands (“Government”) files this Complaint against JPMorgan Chase Bank, N.A. (“JP Morgan”) for violations of Trafficking Victims Protection Act, 18 U.S.C. §§ 1591 to 1595, the Virgin Islands Criminally Influenced and Corrupt Organizations Act, 14 V.I.C. §§ 600 to 614, and the Virgin Islands Consumer Fraud and Deceptive Business Practices Act, 12A V.I.C. §§ 301 to 336, and in support thereof alleges as follows: ## PARTIES 1. The Attorney General of the United States Virgin Islands (hereinafter “Virgin Islands”) brings this parens patriae action on behalf of the Plaintiff, Government of the Virgin Islands, pursuant to 15 U.S.C. § 1595(d) and 3 V.I.C. § 114 and her statutory authority to enforce the laws of the Virgin Islands and protect public safety. 2. The Attorney General, pursuant to her authority to represent the Government of the United States Virgin Islands, also acts on behalf of, and with the lawfully delegated authority of, the Virgin Islands Department of Licensing and Consumer Affairs under 12 V.I.C. § 327 in regard to Count Four of the Government’s Complaint alleging violations of the Virgin Islands Consumer EFTA00162252 C6ses4:222c100904SBRDDocument36-6-1 Filed 01/13/23 Page 3 of 343 Fraud and Deceptive Business Practices Act. 3. This action stems from an enforcement action the Government filed against the Estate of Jeffrey E. Epstein, the Co-Executors of the Estate, and various entities relating to Jeffrey Epstein (“Epstein”), under the Virgin Islands’ Criminally Influenced and Corrupt Organizations Act (“CICO Act”), see Government of the U.S. Virgin Islands v. Indyke et al., Case No. ST-20-CV-14 (Super. Ct. V.I. Jan. 15, 2020). The Attorney General brings this action, after presenting her findings to JP Morgan in September 2022, in her ongoing effort to protect public safety and to hold accountable those who facilitated or participated in, directly or indirectly, the trafficking enterprise Epstein helmed. The investigation revealed that JP Morgan knowingly, negligently, and unlawfully provided and pulled the levers through which recruiters and victims were paid and was indispensable to the operation and concealment of the Epstein trafficking enterprise. Financial institutions can connect—or choke—human trafficking networks, and enforcement actions filed and injunctive relief obtained by attorneys general are essential to ensure that enterprises like Epstein’s cannot flourish in the future. 4. Defendant JPMorgan Chase Bank, N.A. is an American multinational investment bank and financial services company headquartered in New York City and incorporated in Delaware. 5. At all relevant times, JP Morgan engaged in business in the Virgin Islands, including, but not limited to, the acts and practices described herein. 6. As described below, based on documents reviewed and interviews conducted by the Government, JP Morgan knowingly facilitated, sustained, and concealed the human trafficking network operated by Jeffrey Epstein from his home and base in the Virgin Islands, and financially benefitted from this participation, directly or indirectly, by failing to comply with federal banking 2 EFTA00162253 C6ses4:222c100904SBRDDocument36-6-1 Filed 01/13/23 Page 3 of 343 regulations, JP Morgan facilitated and concealed wire and cash transactions that raised suspicion of—and were in fact part of—a criminal enterprise whose currency was the sexual servitude of dozens of women and girls in and beyond the Virgin Islands. Human trafficking was the principal business of the accounts Epstein maintained at JP Morgan. 7. Upon information and belief, JP Morgan turned a blind eye to evidence of human trafficking over more than a decade because of Epstein’s own financial footprint, and because of the deals and clients that Epstein brought and promised to bring to the bank. These decisions were advocated and approved at the senior levels of JP Morgan, including by the former chief executive of its asset management division and investment bank, whose inappropriate relationship with Epstein should have been evident to the bank. Indeed, it was only after Epstein’s death that JP Morgan belatedly complied with federal banking regulations regarding Epstein’s accounts. ## JURISDICTION, VENUE, AND RELATED CASE 8. This action is brought pursuant to and based on federal and Virgin Islands statutes, including the federal Trafficking Victims Protection Act, 18 U.S.C. §§ 1591 to 1595 (“TVPA”), and the federal Bank Secrecy Act, 31 U.S.C. §§ 5311 to 5336 and its implementing regulations (“BSA”). 9. This Court has federal question subject-matter jurisdiction pursuant to 28 U.S.C. §1331 because the Government’s TVPA and BSA-based causes of action arise under federal law. 10. This Court has supplemental jurisdiction over the Government’s Virgin Islands law claims pursuant to 28 U.S.C. § 1367(a) because these claims are so related to those arising under or based on federal law as to form part of the same case or controversy under Article III of the United States Constitution. 3 EFTA00162254 C@ses4:222-2-cv1-0090-4SBR DDocument36-6-1 Filed 01/10/23 Page 5 of 343 11. This Court is an “appropriate district court of the United States” in which for the Government to obtain appropriate relief under 18 U.S.C. § 1595(d) and venue is proper under 28 U.S.C. § 1391(b)(2) because Defendant maintains its principal place of business within this judicial district, so that this Court may exercise general personal jurisdiction over Defendant, and because many of the alleged acts and omissions of Defendant giving rise to the Government’s claims took place within this judicial district, so that this Court may exercise specific personal jurisdiction over Defendant. 12. Pursuant to Local Civil Rule 1.6(a), the undersigned believe that this action is related to Doe 1 v. JP Morgan Chase & Co., No. 1:22-cv-10019 (S.D.N.Y. Nov. 24, 2022), because both actions arise from a common nucleus of operative fact involving Defendant JP Morgan’s alleged participation, directly or indirectly, in Epstein’s sex-trafficking venture by facilitating payments to women and girls, channeling funds to Epstein to fund the operation, and concealing Epstein’s criminal conduct by failing to comply with federal banking regulations. ## BACKGROUND ## I. JP Morgan's Federal and State Legal Requirements 13. JP Morgan is subject to federal laws, including the BSA and the Uniting and Strengthening America by Providing Appropriate Tools Required to Intercept and Obstruct Terrorism Act of 2001, Pub. L. No. 107-56, 115 Stat. 272 (“USA PATRIOT Act”), which amended certain BSA regulations. 14. Under both the BSA and USA PATRIOT Act, JP Morgan is required to implement adequate, risk-based anti-money laundering (“AML”) policies and systems to detect and prevent money laundering or other use of the institution’s services to facilitate criminal activities. This includes, but is not limited to, maintaining a due diligence program, filing suspicious activity 4 EFTA00162255 C@ses4:222>v1-0099-4SBR DDocument36-6-1 Filed 01/13/23 Page 5 of 343 reports（"SARs"）when the financial institutions detect suspicious behavior and currency transaction reports（"CTRs"）for currency transactions or series of currency transactions that exceed $10,000 in a 24-hour period, preventing structuring or assistance with structuring of transactions undertaken for the purpose of evading federal reporting requirements, and maintaining systems to prevent money laundering. 15. The FDIC and the other federal banking regulators, including the Federal Reserve Board and Office of the Comptroller of the Currency, formed an interagency organization known as Federal Financial Institutions Examination Council (“FFIEC”). 16. To provide further guidance to banks on what BSA compliance requires, FFIEC published a Bank Secrecy Act/Anti-Money Laundering Examination Manual (“BSA Manual”). The BSA Manual explains that an effective SAR program is essential: Suspicious activity reporting forms the cornerstone of the BSA reporting system. It is critical to the United States’ ability to utilize financial information to combat terrorism, terrorist financing, money laundering and other financial crimes. Examiners and banks should recognize that the quality of SAR content is critical to the adequacy and effectiveness of the suspicious activity reporting system. $ ^{1} $ 17. Pursuant to the BSA Manual, "[p]roper monitoring and reporting processes are essential to ensuring that the bank has an adequate and effective BSA compliance program. Appropriate policies, procedures, and processes should be in place to monitor and identify unusual activity." $ ^{2} $ When a bank detects suspicious activity, it is required to report that information within 30 days to the U.S. Department of the Treasury’s Financial Crimes Enforcement Network (“FinCEN”). The reporting requirement ensures that the government is able to monitor and act $$^1$$ FFIEC Bank Secrecy Act/Anti-Money Laundering Examination Manual, Suspicious Activity Reporting at 1 (2014) https://bsaaml.ffiec.gov/docs/manual/06_AssessingComplianceWithBSARegulatoryRequirement s/04.pdf. $$ ^{2} Id. \text{ at } 2. $$ 5 EFTA00162256 C@ses4:222>v1-0099-4SBR DDocument86-6. Filked 01/13/23 Page 6 off 343 when alerted to potential illegal conduct. 18. Appendix F of the BSA Manual includes examples of suspicious transactions that may indicate money laundering, terrorist financing, or fraud, including: a. Funds transfer activity is unexplained, repetitive, or shows unusual patterns; b. The currency transaction patterns of a business show a sudden change inconsistent with normal activities; c. Unusual transfers of funds occur among related accounts or among accounts that involve the same or related principals; d. Currency is deposited or withdrawn in amounts just below identification or reporting thresholds; e. Regarding nonprofit or charitable organizations, financial transactions occur for which there appears to be no logical economic purpose or in which there appears to be no link between the stated activity of the organization and the other parties in the transaction; f. Funds are sent or received via international transfers from or to higher-risk locations. 19. In addition, the CICO Act, 14 V.I.C. § 600, incorporates violations of Virgin Islands Law and federal felonies, which includes the BSA’s criminal-liability provisions. ## II. Jeffrey Epstein's Criminal Conduct 20. Jeffrey Epstein was a resident of the Virgin Islands. 21. In 2008, Epstein pled guilty to one count of solicitation of prostitution with a minor in Palm Beach, Florida. As a result of that conviction, Epstein was forced to register as a sex offender in the Virgin Islands. 6 EFTA00162257 C6ses4:222cv100904SBRDDocument36-6-1 Filed 01/13/23 Page 8 of 343 22. Epstein was a Tier 1 offender under Virgin Islands law based upon his Florida conviction of procuring a minor for prostitution. 23. On January 15, 2020, the Government filed a lawsuit against Jeffrey Epstein’s estate and related individuals and entities for violation of the CICO Act, 14 V.I.C. §§ 600 to 614, and civil conspiracy, which the Government recently settled. As laid out in the Government’s Second Amended Complaint, ST-20-CV-14, (“SAC”) (attached as Exhibit 1), Epstein created a network of companies and individuals who participated in, directly or indirectly, and conspired with him in a pattern of criminal activity related to the sex trafficking, forced labor, sexual assault, child abuse, and sexual servitude of these young women and children. SAC ¶ 43-75. Epstein and his associates trafficked underage girls to the Virgin Islands, held them captive, and sexually abused them, causing them grave physical, mental, and emotional injury. Id. 24. To accomplish this criminal activity, Epstein formed an association in fact with both companies and non-profit organizations that he owned and operated, as well as individuals, who were willing to participate in, directly or indirectly, facilitate, and conceal Epstein's criminal activity in exchange for Epstein's bestowal of financial and other benefits, including sexual services and forced labor from victims. Id. at 157-195. 25. In October 2012, the Southern Trust Company—one of the companies Epstein owned—applied for economic benefits from the Virgin Islands Economic Development Commission (“EDC”) so the company could provide “cutting edge consulting services” in the area of “biomedical and financial informatics.” Id. ¶ 157-158. Southern Trust Company received a 10-year package of economic incentives running from February 1, 2013 until January 31, 2023 that included a 90% exemption from income taxes and 100% exemptions from gross receipts, excise, and withholding taxes in the Virgin Islands. Id. ¶ 159. 7 EFTA00162258 C6ses4:222c100904SBRDDocument36-6-1 Filed 01/13/23 Page 8 of 343 26. Southern Trust, in fact, appeared to perform no informatics or data-mining services during this period. Instead, Southern Trust funded the Epstein Enterprise (defined below), acting as a conduit for payment to foreign women, credit cards, airplanes and other instrumentalities. Id. 167-173. 27. This illicit association of Epstein, businesses, and his associates constitutes what is referred to herein as the “Epstein Enterprise.” Specifically included in the Epstein Enterprise were the following companies and non-profit organizations, all of which had accounts with JP Morgan: 2013 Butterfly Trust, Coatue Enterprises, LLC, C.O.U.Q. Foundation, Enhanced Education, Financial Trust Company, Inc., HBRK Associates, Inc., Hyperion Air, Inc, JEGE, Inc., JEGE, LLC, NES, LLC, Plan D, LLC, Southern Financial, LLC, and Southern Trust Company. 28. Epstein used his wealth and power to create the Epstein Enterprise, which engaged in a pattern of criminal activity by repeatedly procuring and subjecting underage girls and young women to unlawful sexual conduct, sex trafficking, and forced labor. 29. Many of these women, particularly after Epstein’s conviction in 2008, were trafficked from Eastern Europe. As the Government explained in its Second Amended Complaint, these women were recruited and, in several instances, required to marry other Epstein victims in order to maintain their immigration status and their availability to Epstein. Id. ¶ 62-63, 78, 86. 30. As also alleged in the Second Amended Complaint, recruiters and victims were paid in cash or through entities set up by Epstein and/or his associates. Id. ¶ 100. Many of these companies were shell companies, that existed merely to transfer money to other accounts, or to shelter Epstein’s assets from judgment. Id. ¶ 116. 31. Epstein’s lawyer, Darren K. Indyke, and accountant, Richard Kahn, now the Co-Executors of Epstein’s Estate, authorized or directed many of the transactions in JP Morgan accounts 8 EFTA00162259 CaGaste:222@vc1000904JSFRD@oouene8616 Filled 01/18/23 Page 900631123 held by Epstein or related entities. *Id.* ¶ 8-10, 76-117. 32. Epstein and the Epstein Enterprise continued trafficking and sexually abusing young women and female children until Epstein was arrested by federal law enforcement authorities on July 6, 2019 on federal charges for the sex trafficking of minors. 33. Epstein was found dead on August 10, 2019 while in custody in a federal detention center in New York on charges for sex-trafficking crimes. Id. ¶ 7. ## ALLEGATIONS ## I. Jeffrey Epstein Was an Extremely High-Risk Customer 34. Jeffrey Epstein’s reputation as a sex trafficker and abuser of women and girls was well-known and well-publicized for more than a decade before his death. 35. Between 2005 and 2013, there were numerous press reports that Epstein sexually abused women and girls. 36. In March 2005, there were press reports that Epstein paid a 14-year old girl in Palm Beach, Florida for a “massage” and then molested her. Following these allegations, multiple underage girls, many of them high school students, told police that Epstein also hired them to give sexual massages. 37. Throughout 2006—when Epstein was arrested in Palm Beach, Florida for solicitation of a minor—there was extensive press regarding the nature and extent of Epstein’s sexual offenses, including the existence of dozens of victims. 38. In 2008, Epstein pled guilty to sexual offenses in Palm Beach, Florida, including solicitating a minor for prostitution. Epstein was sentenced to 18 months in jail and was required to register as a sex offender. 39. In 2009, the non-prosecution agreement between Epstein and the United States 9 EFTA00162260 C6ses4:222-2cv1-00198-4SBR D documenter36-6 Filedi 01/10/23 Page 10 off 343 became public. It revealed allegations that Epstein may have used interstate commerce to induce minors to engage in prostitution, engaged in illicit sexual conduct with minors, and trafficked minors. 40. In 2010, press reports noted allegations that Epstein was involved with Eastern European women in particular and that a modeling agency he helped fund brought “young girls . . often from Eastern Europe” to the United States on Epstein’s private jets. $ ^{3} $ ## II. JP Morgan Knew Epstein Was a Felon, Registered Sex Offender, and Alleged Child Trafficker 41. JP Morgan did business with Jeffrey Epstein from as early as 1998 to 2013. In that time, JP Morgan serviced approximately fifty-five Epstein-related accounts collectively worth hundreds of millions of dollars. $$^3$$ Conchita Sarnoff, Jeffrey Epstein Pedophile Billionaire and His Sex Den, The Daily Beast (July 22, 2010), https://www.thedailybeast.com/jeffrey-epstein-pedophile-billionaire-and-his-sex-den. 10 EFTA00162261 C6ses4:222-vc1-001904-SBRD Document86-6 Filed 01/10/23 Page 12 off 343 11 EFTA00162262 C6ses4:222-vc1-001904-SBRDDocument36-6 Filedi 01/10/23 Page 12 off 3423 12 EFTA00162263 C6ses4:222-2cv100904SBR Document86-6 Filedi 01/13/23 Page 13 of 343 ## III. Head of JP Morgan’s Private Bank Had Close Personal Relationship With Epstein 52. Former senior executive, Jes Staley (“Staley”), developed a close relationship with Epstein when Staley was the head of JP Morgan’s Private Bank, which is a segment of JP Morgan’s business dedicated to extremely wealthy clients with at least $10 million in assets. 53. Between 2008 and 2012, Staley exchanged approximately 1,200 emails with Epstein from his JP Morgan email account. These communications show a close personal relationship and “profound” friendship between the two men and even suggest that Staley may have been involved in Epstein’s sex-trafficking operation. They also reveal that Staley corresponded with Epstein while Epstein was incarcerated and visited Epstein’s Virgin Islands residence on multiple occasions. 13