Democrats to probe JPMorgan over Jeffrey Epstein ties

Senate Democrats are gearing up to investigate JPMorgan Chase‘s banking relationship with the late sex offender Jeffrey Epstein once they take control of Congress early next year.

Democratic staffers on the Senate Finance Committee intend to home in on how high-ranking executives at JPMorgan handled Epstein, a source familiar with the panel’s thinking told CNBC on Thursday. The person spoke on condition of anonymity because the probe of the nation’s biggest bank has not been announced.

The Finance Committee is likely to be chaired beginning in January by Sen. Ron Wyden, an Oregon Democrat who currently is the panel’s ranking member. Wyden has made clear he plans to make full use of the subpoena powers that committee majorities wield.

Democratic staffers aim to focus in particular on decisions about Epstein made by Mary Callahan Erdoes, the CEO of JPMorgan’s asset and wealth management division, the source said.

JPMorgan did not immediately respond to CNBC’s request for comment on the planned investigation.

In a 2023 deposition, Erdoes said she was aware as early as 2006 that Epstein was accused of paying cash to have underage girls brought to his home. Epstein had been a client of the bank since 1998.

Epstein became a registered sex offender after pleading guilty in 2008 in Florida to a state criminal charge of procuring an underage girl for prostitution.

JPMorgan CEO Jamie Dimon in his own, later deposition in 2023, said Erdoes had authority to cut off Epstein as a client. She did not take that step until 2013.

Epstein, a former friend of President Donald Trump, ex-President Bill Clinton, and many other high-profile people, died in a jailhouse suicide in August 2019, weeks after being arrested on federal child sex-trafficking charges.

A lawyer for the U.S. Virgin Islands told a federal judge in New York in 2023 that JPMorgan “was a full-service bank for Jeffrey Epstein’s sex trafficking,” and that it waited until after he killed himself to notify the Treasury Department of $1 billion in suspicious transactions related to trafficking by Epstein.

“This was a CYA [cover your a–] reporting after 16 years of all of the monies flowing in his JPMorgan accounts after he was dead,” the lawyer, Mimi Liu, said.

JPMorgan has blamed former investment banking chief Jes Staley for concealing or failing to report criminal activity related to Epstein, with whom he had a close relationship.

Staley, who left JPMorgan in 2013 and later became CEO of Barclays before stepping down in 2021, has denied knowledge of Epstein’s crimes.

House Oversight Chair James Comer, R-Ky., after a closed-door interview with Staley in July, said that the former executive had encouraged JPMorgan to keep Epstein as a client.

In mid-2023, JPMorgan agreed to a $290 million settlement with victims of Epstein without admitting wrongdoing. That same year, agreed to pay $75 million to settle a separate lawsuit by the U.S. Virgin Islands alleging that the bank facilitated and benefited from the sex…