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A U.S. Senate committee investigating the tax avoidance work that Jeffrey Epstein, the registered intercourse offender, did for the non-public fairness mogul Leon Black has questioned Financial institution of America over Mr. Black’s hefty funds to Mr. Epstein, in line with a letter considered by The New York Occasions.
This month, Senator Ron Wyden of Oregon, the chairman of the Senate Finance Committee, despatched the financial institution a letter asking concerning the extent of due diligence it carried out earlier than processing $158 million in funds that Mr. Black made to Mr. Epstein from 2012 to 2017 for that tax work.
The letter additionally requested whether or not any financial institution staff had raised issues concerning the objective of these funds. They included charges paid to Mr. Epstein for advising on a classy belief that saved Mr. Black greater than $1 billion in taxes. Banks are required to file suspicious exercise stories, or SARs, with monetary regulators for any transaction they take into account questionable.
Mr. Black’s decades-long enterprise dealings and private relationship with Mr. Epstein have dogged him ever since Mr. Epstein was arrested on federal intercourse trafficking costs in July 2019. (Mr. Epstein hanged himself in a federal jail a month after his arrest.) Mr. Black, a co-founder of Apollo World Administration, with a internet value of $13 billion, in the end stepped down from all management posts due to the controversy.
Within the letter, dated April 4, Mr. Wyden stated the committee believed the funds to Mr. Epstein for tax work got here from accounts Mr. Black had at Financial institution of America. He additionally requested whether or not any artwork transactions involving Mr. Epstein and Mr. Black, a well known artwork collector, had raised issues internally.
Whit Clay, a spokesman for Mr. Black, stated, “The transactions the committee reviewed had been each lawful and conceived, vetted and executed by respected regulation corporations and tax advisers.” He added that Mr. Black “has paid all taxes owed to the federal government” and offered detailed info to the committee.”
The position of huge banks in facilitating Mr. Epstein’s intercourse trafficking of teenage women and younger ladies got here below scrutiny final yr when JPMorgan Chase agreed to pay $290 million to greater than 100 of his victims, and Deutsche Financial institution reached a $75 million settlement with a lot of these victims.
Final summer time the Senate committee introduced that it was investigating the work Mr. Epstein did for Mr. Black as a part of an examination of authorized “tax dodging” schemes utilized by the ultrarich. The committee had stated it wished to be taught extra about Mr. Epstein’s “extraordinary compensation” package deal and the particular particulars of the tax avoidance methods Mr. Epstein designed for Mr. Black.
Mr. Wyden, within the letter to Financial institution of America’s chief govt, Brian Moynihan, stated the committee was making an attempt to find out whether or not the options Mr. Epstein got here up with to assist Mr. Black keep away from billions of {dollars} in taxes had been “executed in a fashion per federal tax legal guidelines.”
A spokesman for Financial institution of America declined to remark.
When the federal authorities raided Mr. Epstein’s residence within the U.S. Virgin Islands in 2019, shortly after his demise, they discovered a raft of Financial institution of America financial institution statements belonging to Mr. Black, in line with paperwork from Mr. Epstein’s property that had been reviewed by The Occasions. Brokers with the Federal Bureau of Investigation unfold the financial institution statements out on the ground to {photograph} them.
The property paperwork reviewed by The Occasions additionally present that an worker of Mr. Black’s household workplace requested Mr. Epstein to assessment a draft of the billionaire’s 1,700-page federal tax return in 2018. Mr. Epstein, in line with the paperwork, gave him recommendation on hedge fund investments, distribution of Apollo partnership pursuits, belief and property work, and artwork offers — together with the sale of an Alberto Giacometti sculpture by which Mr. Epstein was a stealth purchaser.
For a few years, Financial institution of America was the principle supplier of artwork loans to Mr. Black, whose $1 billion non-public assortment contains works by Edvard Munch, Leonardo da Vinci, Edgar Degas, Henri Matisse, Joan Miró and Pablo Picasso, in line with company filings.
Within the letter to Mr. Moynihan, Mr. Wyden additionally requested whether or not the financial institution had performed any inner assessment into the sale of paintings that raised issues about whether or not “Epstein was appearing as a straw purchaser or vendor.”
A spokesman for the Senate Finance Committee declined to remark.
Mr. Black initially downplayed his connection to Mr. Epstein. However in 2020, after The Occasions reported on the in depth monetary and private ties between the 2 males, Mr. Black requested Apollo’s board to rent the regulation agency Dechert to assessment the appropriateness of all his dealings with Mr. Epstein. The 22-page Dechert report, issued in early 2021, cleared Mr. Black of any wrongdoing or data of Mr. Epstein’s predatory sexual abuse. It additionally concluded that Mr. Epstein had given Mr. Black official tax recommendation.
Final yr, Mr. Black, with out admitting any wrongdoing, agreed to pay $62.5 million to the U.S. Virgin Islands to keep away from a lawsuit arising from the territory’s investigation into the financing of Mr. Epstein’s sex-trafficking operation.
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