- The former financier Jeffrey Epstein was arrested in New Jersey on July 6 on sex-trafficking charges.
- Epstein’s wealth comes from his privately held wealth-management firm, with a portion of it made by handling the $US6.7 billion fortune of L BrandsCEO Les Wexner, according to Bloomberg.
- Epstein, who according to Forbes estimates is not a billionaire, has run his business from the US Virgin Islands since at least 1996.
- Visit Business Insider’s homepage for more stories.
Jeffrey Epstein, who as a financier hobnobbed with Donald Trump, the Clintons, and Hollywood celebrities, was arrested over the weekend on suspicion of sex trafficking minors.
According to charges filed on July 8, the 66-year-old former financier is accused of using his fortune to pay underage women to give him massages that became increasingly sexual in nature.
Little is known about where Epstein’s fortune comes from. Epstein rose to prominence as the money manager of L Brands CEO Les Wexner, Vanity Fair reported in a lengthy profile in 2011. Unlike other well-known financiers, Epstein kept the client list and investments of his US Virgin Islands-based firm – in addition to his own personal net worth – confidential.
Keep reading to learn how Epstein reportedly made his fortune.
Jeffrey Epstein got his start in finance at Bear Stearns.
Epstein’s first job in finance was working as an options trader at Bear Stearns, according to NBC News. He’d previously been a teacher at the Dalton School, an exclusive Manhattan college preparatory school.
Epstein reached the level of limited partner at Bear Stearns before he left the company to launch his own firm in 1981,Vanity Fair reported.
Epstein’s firm was originally called J. Epstein & Co. before being renamed Financial Trust Co.
Epstein said his fortune came from the fees he charged his billionaire clients, according to Vanity Fair.
Epstein refused to reveal his client list to Vanity Fair, other than saying that they all have assets in excess of $US1 billion. That type of secrecy is unusual among top financiers, the magazine reported.
“I was the only person crazy enough, or arrogant enough, or misplaced enough, to make my limit a billion dollars or more,” Epstein has said on multiple occasions, according to Vanity Fair’s reports. Epstein said he invests his client’s fortunes into currency markets.
Epstein does have one well-known former client: Les Wexner, the CEO of L Brands.
Wexner was not only Epstein’s sole confirmed client but also a close friend, according to Vanity Fair. According to the outlet, Epstein had an active role in L Brands, which owns Bath & Body Works, Express, and Victoria’s Secret. Vanity Fair reported that Wexner even asked Epstein to fire L Brands employees.
Epstein denies rumours that he owes his firm’s success to Wexner, however. “I had really rich clients before,” Vanity Fair reported.
Epstein has also been paid to help clients recover money stolen by fraudulent brokers and lawyers, a review of 1989 court documents by Vanity Fair found.
That aspect of Epstein’s business took up 80% of his time, he said in a deposition. Epstein referred to himself as a “bounty hunter,” according to Vanity Fair.
Epstein has been sued on various occasions.
The US attorney’s office sued Epstein in 1998, alleging he illegally subleased the former home of the deputy consul general of Iran and charged the new tenant $US5,000 more a month in rent than the State Department charged him for the residence. However, a review of court documents by Vanity Fair found the US attorney’s office lost the case.
Epstein was also sued by Citibank in 2003 over allegations he defaulted on loans he took out to fund investments, according to Vanity Fair.
Epstein resides in a townhouse in New York City’s Upper East Side. Bloomberg has valued it at $US77 million.
Wexner used a trust to buy the residence (which is believed to be the largest private residence in Manhattan) for $US13.2 million in 1989, Vanity Fair reported. Epstein moved in after Wexner and his wife, Abigail Koppel, moved to Ohio in 1996. Wexner’s trust transferred ownership of the house to Epstein in 2011 for $US0, Bloomberg reported.
Prosecutors are in the process of seizing the house, which they allege is the scene of some of the crimes Epstein is accused of, according to Bloomberg.
While the exact size of Epstein’s fortune is unclear, Forbes estimates it is less than $US1 billion.
Epstein has never appeared on Forbes’ ranking on the world’s billionaires because of a lack of evidence on the size of his fortune, the magazine reported. The reported source of Epstein’s wealth continues to be his hedge fund, which has released no public records.
Most of Epstein’s wealth is held in the US Virgin Islands.
Financial Trust Co. is incorporated in St. Thomas, US Virgin Islands, according to Forbes. Spencer Kuvin, the attorney who represented three of Epstein’s accusers in the 2011 sexual-assault case in Florida told Forbes that despite their efforts, those court proceedings did not reveal the size of Epstein’s fortune. Epstein’s lawyers said only that his net worth had “nine figures.”
“In the litigation itself we were never able to get him to produce verified financial information,” Kuvin told Forbes. ” The ‘nine figures’ came by negotiation. It kept going up and up and up. They started at zero – they wouldn’t tell us at all.”
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