So Matt, I've been up since three am waiting for this.

Story to drop.

Better be a big one.

It's huge, huge.

This week we've got a special episode of Disclosure.

Let's go, Let's go, Let's go.

I'm investigative journalist Jason Leopold.

I spend most of my days getting documents from the government.

I'm attorney Matt Tappik, and I fight them in court to open their files when they don't want to.

From Bloomberg and no smiling.

This is Disclosure, a podcast about prying loose government secrets, the Freedom of Information Act, and the unexpected places that takes us.

Cool shirt Jason Horror Business by the Misfits.

This is my annual Halloween shirt.

We are recording this on Friday, October thirty first, my favorite day of the year.

Halloeen.

I swear this is the coincidence I have on my annual Halloween original Misfits hoodie that I bring out every Halloween as I'm giving out candy to the local kids with the soundtrack of like Slayer and Decide and you know a bunch of like thrashing.

Oh man, you threw in da side.

So where you've been, you've been quiet?

This week.

Well, Matt, I've been working on a story at Jeffrey Epstein's story.

By the looks of it, Yes, Matt, that is correct.

There's a breakthrough in the Jeffrey Epstein case.

Today Bloomberg is reporting this revelation.

The scope of the investigation to Epstein may have been actually much larger than we previously knew.

Congressman Robert Garcia, the ranking member on House Oversight, shared his.

Alarm and this is a huge problem.

Part of the investigation is incredibly troubling.

You know, Jeffrey Epstein has been in the news a lot this year.

Epstein, of course, is the wealthy and connected financier who is convicted of sex trafficking miners before his death and detention in twenty nineteen.

So the news cranked up in the past year again when Donald Trump, on the campaign trail said that if he were elected, he put out the full files that the government has on Epstein.

However, in July, the Trump administration backtracked, saying that no further disclosure would be appropriate or warranted.

Uh oh, how did that go over?

Well, it's left a lot of unanswered questions about Epstein that go back almost twenty years to the first Epstein investigation we know about.

That was the federal probe into allegations that he solicited sex with minors.

A lot of the Epstein controversy dates back to that investigation and the deal that federal prosecutors struck.

That deal led Epstein to plead guilty to lesser state charges in Florida and effectively shielded co conspirators from prosecution, and it left his accusers in the dark about the deal the Feds were striking.

The outcome has been widely derided as far too lenient, and it let Epstein return pretty quickly to a social circles that also included a lot of well known, wealthy people like.

Say, Prince Andrew.

Well, Matt, it's just Andrew.

Now Prince Andrew will no longer be a prince, something that has not happened in more than a century.

King Charles stripping his brother of all his titles over his ties to the late convicted sex predator Jeffrey Epstein.

Okay, so there's a lot out about Epstein, and yet you found something pretty big.

Oh yeah, I definitely found something pretty big, Matt.

I found out about a whole other line of federal investigation to Epstein that hasn't been reported ever.

Nont allegations about sex trafficking or sex with minors, but something else, entirely money laundering.

Wait what let me tell you, Matt, this really does change a lot about how we look at the whole Epstein affair.

There's still big questions about his money, how a college dropout turned financial advisor built his fortune in the first place, And since you have found dead in his cell in twenty nineteen, those questions have only grown this summer.

Senator Ron Wyden, he's a top Democrat on the Senate Finance Committee, stoke that fire.

Now somewhere in the Treasury Department, mister President, locked away in a cab a drawer, is a big Epstein file.

Wyden said.

His panel reviewed records compiled by the Treasury's Financial Crimes Enforcement Network, also known as FINN, said, and those records revealed that major banks processed more than one point five billion in suspicious transactions.

That's billion with a B.

Yeah, one point five billion that Epstein allegedly used to traffic women or in suspicious transactions that looked a lot like money laundering.

Four seven hundred and twenty five Wire transfers flowing in and out of just one of mister Epstein's bank accounts.

That is more than four thousand potential lines of investigation.

So my new story, Matt, shows that almost twenty years ago, federal prosecutors were going down a similar path following Epstein's money until they just stopped.

Okay, tell me where does this start?

All?

Right?

So I've been learning quite a bit about Jeffrey Epstein these past few months because I've been going through a trove of emails eighteen thousand emails from Epstein's private Yahoo email account obtained by Bloomberg.

And these emails show Epstein, in his own words, they've never been released before.

They detail a methodical and callous approach he took to recruiting young women, his close partnership with Glain Maxwell, and the support he received from an array of high powered associates, attorneys, academics, bankers.

So when is he writing all these emails?

These emails from Epstein's inbox span a twenty year timeframe.

Wow.

But the message traffic was most active between like two thousand and five and two thousand and eight, which is critical because that happens to be a pivotal period for Epstein.

That was the period when he came under scrutiny by Florida officials.

And it's when the Palm Beach Police Department and a criminal investigation into a local man that teenage girls refer to simply as Jeff.

So this first investigation into allegations relating to sex with minors started locally, but then about a year later, in two thousand and six, in came federal prosecutors from the Southern District of Florida.

So how do you know what the feds we're looking into?

Do you have documents from their investigation?

For the most part, No, I don't.

What I have though, are Epstein's emails, So I'm not seeing the investigation itself, just how Epstein and his lawyers reacted and shaped their legal strategy.

From the start, he cast this whole thing as an unfair probe into him, despite that it focused on his involvement with underage girls, which by then investigators had known about for years.

So did you get these records through foya?

No, Matt, I have other ways of getting records.

Could you foya the DOJ and ask for the prosecutor's records?

Yeah?

You could, and in fact, a lot of people have FOYA DOJ, FBI and even some other agencies for Epstein's records, which are the records that make up the Epstein files.

And in fact, way back in twenty seventeen, Radar Magazine had filed a Fouer request with the FBI for Jeffrey Epstein related records and they got about one thousand pages released, but it took them suing the FBI to get those records, and the bureau withheld thousands of other pages.

That lawsuit is still pending, it's still happening right now, and so it's happening alongside the pressure that's coming on the Trump administration to release the Epstein files.

So there is active foil litigation.

There's still a bunch of Fouyer requests that have been filed for Epstein records.

So we may be learning more through some government records later on possibly.

Okay, So where does the money laundering investigation come in?

Okay?

So, documents in Epstein's inbox show that in November of two thousand and six, prosecutors issued us a pace for Epstein's personal income tax returns for the previous two years.

Then in February two thousand and seven, a money laundering probe was opened, and around the same time, prosecutors focused on a pattern of transactions in which Epstein directed some of his employees to withdraw large amounts of cash to disperse to women around the world he exploited, and that was the basis for a potential charge of operating an unlicensed money transmitting business.

So these emails show Matt that the lead federal prosecutor on this case requested that a grand jury issue subpoenas for every financial transaction conducted by Epstein and his six businesses dating to two thousand and three.

And I also reported that prosecutors sent subpoenas to some major banks.

And so, according to the emails, when Jeffrey Epstein learned that the investigation had been broadened into financial crimes, how did he take that?

Oh?

He was furious, in part because the prosecutor contacted one of his longtime wealth management clients, Les Wexner.

Les Wexner is the billionaire businessman behind Victoria's Secret and Bath and body Works, and Epstein's emails showed that not long after the prosecutor's conversation with Wexner, Wexner then took steps to end Epstein's role as his wealth manager.

I'm guessing that didn't go over too well with Epstein.

So what did he do?

Epstein pulled in some high powered lawyers, including Harvard law professor Alan Dershowitz and former independent counsel Ken Starr, and the lawyers launched an aggressive campaign to discredit the federal prosecutor's attempts to follow the money and pressure higher ups to remove the prosecutor and others from the case or scuttle it entirely.

Dershowitz told Bloomberg that he does not recall any involvement in the discussions related to allegations of money laundering, and ken Starr died in twenty twenty two.

Now that's interesting, Jason, because listeners on this pot are going to hear a lot about the fact that when famous people die, you can foia the FBI and see what files there are, which you normally can't get while they're alive because it's considered an invasion of privacy, But once they've died you can get records.

Which you know very well is my knee jerk reaction.

Whenever someone prominent dies.

I usually find out about famous people dying when I get a text from Jason about his foyer requests before I've even seen it in the news.

And so I took a look on the FBI vault.

That's where they post records that are frequently requested if they've been requested multiple times, and sure enough, there are hundreds of Ken Starr pages.

All right, let's get back to this story here.

So who is the federal prosecutor that's issuing these subpoenas and talking to Epstein's client.

So the lead prosecutor here was an assistant US attorney for the Southern District of Florida.

Her name is Marie Villa Fania.

She left that office in twenty twenty three, and she declined to comment on the story.

But we already know some things about her broader prosecution.

By May two thousand and seven, she had drafted a fifty three page indictment and an eighty two page prosecution memo.

And we know from a Justice Department report that came out in twenty twenty that Villa Fanya urged her superiors to move swiftly because she believed that Epstein was continuing to sexually abuse girls.

But the report says that Villa Fanya was stonewalled by senior officials at the office who saw her as too aggressive.

Interesting, So that Justice Department report from twenty twenty does that mention that the Florida prosecutor was looking into financial crimes.

No, there's not a single mention in that report about financial crimes, but we know it from Epstein's inbox.

And I also talked to a former law enforcement official who was familiar with the case, and that person said the evidence Villafani collected was serious enough that she wrote in the prosecution memo that Epstein should be charged with money laundering and operating an unlicensed money transmitting business.

And this person also said that the probe lasted eighteen months and turned up at least tens of millions of dollars in questionable financial transactions.

And Matt, what is really important here is that these details have never been disclosed.

So everything that we know about the Epstein investigation that took place in two thousand and six through two thousand and eight, for the most part, center on the sex crimes.

There's never been any disclosure around financial crimes.

Yeah, this is really good stuff.

So that's what we know about the indictment.

It's just a draft indictment, Jason, right.

Yeah, the indictment has never been publicly released.

It was never filed with the court along with that eighty two page prosecution memo, and to this day it remained shrouded in secrecy.

So he was never indicted for the things that the lengthy memo and draft indictment were contemplating.

No.

Never, Let's jump to July two thousand and seven.

She and another prosecutor are then directed to enter into the negotiations with Epstein and his legal team on a non prosecution agreement.

So she works up the materials towards an indictment, but her superiors decide, we're not going to do that, let's go negotiate a deal instead.

Well that's the implication.

So the Justice Department report that was released in twenty twenty that basically examined the integrity of the non prosecution agreement, as well as our emails, show that prosecutors wanted Epstein to plead guilty to sex crimes with a minor, register as a sex offender, paid damages to an undisclosed list of victims, and spend two years in prison, but Epstein's lawyers rejected that, and a month in these negotiations stalled.

So what happens after that?

Well, then on August sixteenth, two thousand and seven, Villafania requested that a grand jury issue subpoenas for Epstein's financial records dating back to two thousand and three.

And on the same day she also sent a letter informing Epstein's defense attorneys that she would continue investigating his finances as long as the non prosecution agreement remained unsigned.

And in the emails you can see Epstein and his lawyers are grappling with this, so they prepare a twenty two page document titled in Ree Grand Jury Investigation of Jeffrey Epstein.

Hey, it's in RAY.

I like to say in reere, you really because I have no idea.

Yeah, I mean that's what I usually said.

In ray.

That's legal speak for with regard to grand jury investigation of Jeffrey Epstein.

And you can see from the track changes that there are a lot of edits here from Jee and those are at Stein's initials, and there's a line in it from Villafania that says, quote, in other words, if the sex offense cases resolved, the office would close its investigation into other areas as well.

The matter has not been and it does not appear that it will be resolved, So the money laundering investigation continues, and requests number six, seeking records of every financial transaction conducted by Epstein and his six businesses from January first, two thousand and three to the present will not be withdrawn.

So the prosecutor is basically saying, plead did the sex offense charges?

Or we're continuing on with the money laundering investigation.

Well, it's hard to say for sure, but he signs the non prosecution agreement on September twenty fourth, two thousand and seven, one day before Villafania says she was prepared to indict him, and he would ultimately agree to plead guilty to two sex charges, state level charges, not federal charges.

And that's what led to all these criticisms.

The deal was way too easy.

On it in part yes and the fact that it later came out the women who had accused Epstein didn't know the Feds were making this deal.

So Epstein agrees to the deal, the money laundering investigation goes.

Away, and that's that not exactly.

I'll tell you what happens after the break.

So it's September two thousand and seven.

Epstein has just agreed to admit sex charges as part of this non prosecution agreement.

But according to the Epstein emails we obtained, the federal investigation and the money laundering probe didn't end there.

The prosecutor, Marie Villafana, she kept both the sex crimes and financial crimes investigations open as she began working with Epstein's attorneys to reach an agreement on certain terms of the plea deal, and Epstein was incensed.

He and his attorneys immediately took steps to back out of the agreement he'd sign, and on October fifteenth, two thousand and seven, Epstein sends himself an email and attached a word document he wrote titled did you know that.

I see some of that in the story?

So what does it say?

Okay?

So this document contains twenty nine complaints about the federal investigation.

It portrays his victims as unreliable witnesses and drug abusers vuying for his money, and it casts the investigators and prosecutors as biased, inept, and unethical.

And he says he was unfairly targeted by the financial investigation.

Here are a few bullet points.

Point twenty she begins a money laundering investigation without the necessary requirement of specified illegal funds.

Point twenty one she says she is contemplating charging a violation of a money transmitting statue, though Epstein has no such business, so he's lashing out.

His email is becoming pretty frantic.

You could see Epstein venting a about the prosecution in another email he wrote in November two thousand and seven to Jimmy Kain, the former chief executive officer of bear Stearns, and another friend.

Matt read the subject subject line this is how crazy Jason?

What does Epstein write?

Okay, so this is a lengthy email and he starts off this email Matt by writing, my team consists of professionals with over two hundred and fifty years of criminal experience.

Wait, wait, criminal experience or criminal justice experience.

No, No, two hundred and fifty years of criminal experience.

Look, my guys know about crime, and what they're telling me this isn't a crime.

Well.

What I do think you need to know about Epstein's emails is they contain so many typos and grammatical errors, misspelled words, and we just publish it as he wrote it.

So yeah, but yes, two hundred and fifty years of criminalist sparents.

I'm going to jump into or two and just note his email address is littlest Jeff at yahoo dot com.

That's how it reads.

That's how it reads littlest Jeff.

But it's actually Little Saint Jeff, which is the name of the island he bought.

Oh it looks like Littlest Jeff.

Yeah, but it's Little Saint Jeff.

Yeah.

So the email goes on to say, in an abundance of care, we have also consulted with outside experts and former Justice Department officials.

The clear and unanimous consensus is they find the conduct outrageous and frankly, not one of them has been able to recall seeing anything like this before.

And among the outrageous behavior he accuses the FEDS of is demanding that he registers a sex offender and pay his quote alleged victims a minimum of one hundred and fifty thousand dollars each.

In his letter to Kane, he accuses the federal government of engaging in quote virtual extortion.

I get to say, I mean, this guy's facing some pretty serious stuff.

And I think he's worth a lot of money at this point, and he's quibbling over the amount of money to be paid to the victims.

Yeah, he is questioning whether they are actually victims.

That's what is laid bare in these emails during the course of the government's investigation and prosecution, and this particular email goes on to say, quote, they demanded a jail sentence for someone who had no criminal history, no violence, drugs, no position of authority.

Then when they were confronted with an extensive brief as to why these statutes did not apply, they threatened to bring a money crime based on an illegal money transmitting business, even though no such business ever actually existed.

I get to say, as a lawyer, this guy sounds like a nightmare of a client.

So anyway, now you have an email a week later, what's that about.

Epstein is sending himself an email with a file he's intending for his attorneys to send to the top federal prosecutor in southern Florida, Alex Acosta.

The documents called Acosta Challenge.

It criticizes Prosecutor Villafana, who's leading the investigation, especially our focus on his alleged financial crimes.

And he also false the department for ignoring its own policy of so called horizontal equity, which is supposed to ensure a level playing field in prosecutions.

He's saying they're prejudiced against rich people.

That's his argument.

They're prejudiced against rich people.

So tell me more about what that letter says.

Okay, here's part of it.

The policy clearly implies that a man of wealth should be treated no differently than any of those less fortunate.

That has certainly not happened here.

Though many cases of a similar and even more serious nature have been resolved with a sentence of house arrest.

We were told that it was not available to my client because it would be considered manshin arrest.

My client, under investigation for a sex offense, has been asked for his income tax returns, all bank accounts, his medical records, threatened with a money laundering charge, though the minimum prerequisite of a specified unlawful activity could not be described.

Okay, So Epstein's high powered lawyers are engaging with US Attorney Alex Acosta.

That's the alex Acosta.

Yes, the alex Acosta.

Matt the US Labor secretary.

In Donald Trump's first administration, and years before he got that job, he was a US attorney for the Southern District of Florida who oversaw the Epstein prosecution and the deal he worked out.

That deal finally came together in June of two thousand and eight, nine months after Epstein signed his non prosecution agreement and after relentless letters from Epstein's lawyers.

In its final form, the agreement allowed him to escape federal charges, serve a reduced jail sentence, and shield his co conspirators from prosecution.

Alex Acosta signed off on the plea deal.

So what does this mean for a costa now?

Well, Matt, I'm glad you asked.

Last month, Acosta met with a House committee on Oversight in Government Reform, and during that interview, Representative Melanie Stansbury, she's a New Mexico Democrat on the committee, asked Acosta whether his office had discussed potential financial crimes and whether that factored into the decision not to pursue federal charges.

So what did he say?

What was his answer?

Well, according to the transcript of this interview the committee released this month, Acosta answered, quote, I don't recall a financial aspect and then he went on to say, to my recollection, the discussion was focused on the sex crimes.

And so what do the emails the you obtained?

And to that, well, the emails and documents from Epstein's Yahoo account show that prosecutors in Acosta's office discussed the financial crimes component of the investigation with Acosta and copied him on correspondence about it.

I spoke with Senator Ron Wyden's office for my story, and in a statement he said the new details quote only raise additional questions about Acosta's truthfulness.

And then Wyden also said that the best case scenario, according to his story that's a Costas story, is that it was by incompetence rather than by choice, that he allowed Epstein to go on trafficking women and girls for another decade.

Wow, So what is Acosta said?

So?

Acosta's attorney told Bloomberg that he stands by his testimony.

He said that back in two thousand and six, the Southern District of Florida employed over two hundred attorneys working on countless investigations, and although Acosta approved of the EPSO matter, he did not direct that or any investigation.

That's what his attorney said, So.

This whole financial crimes investigation of Epstein that happened almost twenty years ago, but it managed to stay pretty quiet.

This has never been out there.

Well, there was a hint of it, remember in the emails that I read.

The lead prosecutor in the case, Marie vill Fanya.

She was on the receiving end of a lot of attacks from Epstein's attorneys, and at one point she responded in a five page letter to one of the lawyers.

She writes, quote, the time has come for me to respond to the ever increasing attacks on my role in the investigation and negotiations.

And that letter made its way into a court filing in a twoenty sixteen lawsuit filed by Epstein's victims.

So the letter was public, but no one ever picked up on it.

And at the bottom of one of the pages, Villa Fania included a footnote and she calls out the Epstein lawyer for quote unfounded allegations in your letter about document demands, the money laundering investigation, contacting potential witnesses, speaking with the press and the like.

So she mentions a money laundering investigation.

Yeah, there was a mention, one breadcrumb, easy to miss, but now we have way more.

So when I see this, Jason, I mean, I'm thinking there's got to be all kinds of foyas to be asking, right.

So there are a ton of foyas that could be filed for this material.

And you know, as I said earlier, Mad this these records presumably make up what's in the Epstein file.

So the letters that were sent to the government by Epstein's attorneys could be requested through the FOYA.

But the Justice Department of the FBI has already said that they are not releasing any more records from the so called Epstein files.

What could the public request through FOYA from say, the Department of Justice or FBI.

Well, I mean prosecutor records, FBI records.

These things are all what are called agency records under FOYA, and so they're subject to disclosure unless an exemption applies.

And when you get into criminal kinds of records and law enforcement records, there's a lot of things that can be with held, names of people who are alive, whether they're a witness or a suspect or just incidentally mentioned.

It's often hard to get those.

I mean, you can sometimes overcome that with sufficient public interest and I think there's an awful lot of public interest, in legitimate public interest in getting to the bottom of the Epstein prosecution and how all this stuff was handled.

You know, you can have withholdings based on ongoing investigations, but at this point Epstein has died.

They're not going to charge him with anything further.

You know, I suppose there could be others who maybe there's still some active investigations, but I haven't heard of that, and that seems kind of unlikely.

And you have like investigative techniques and things like that that you know, they could say, well, we were using these secret techniques and if we disclose them then it would be harmful to other investigations.

So I think that in general, there should be things that the public could know under foyer around this, especially given the high public interests and disclosure.

Yeah, and none of this would be controversial for the government to process.

I mean, for example, if I wanted to gain access to the various letters that went to say, the US Attorney's Office in the Southern District of Florida and correspondence around that, would that be withheld under attorney client privilege, no deliberative process, or could I get that could we get that.

Well, yeah, if you're talking, you're talking about the exchange of letters between the prosecutors and Epstein's lawyers.

Yeah, yeah, No, definitely not privileged.

I mean, it's the opposite of privilege.

You're disclosing it to your adversary, So that's not privilege.

It's not going to be deliberative process because they're not like deliberating together, they're adverse to each other.

Right, So now that the government's internal discussions about how to respond to a letter from Epstein, then you're going to run into some exemptions around attorney work product and potentially attorney client privilege and deliberative process and stuff like that.

But all that back and forth, that's not going to be privileged.

There could be some privacy redactions or some other things like that, but that's the opposite of privileged.

Yeah.

That raises the question as to why the Justice Department MVFBI made the final decision in July that they would not release any additional files from the Epstein investigation files.

Like we were just discussing, like the various correspondents that took place between the prosecutors and Epstein's lawyers.

I mean, some of that has been disclosed in civil litigation as exhibits.

But based on what I've seen in Epstein's emails and what I've reported through this story, it's really clear that there are a lot of records that the Justice Department NFBI have that could appease many of those who are clamoring for some more info from so called Epstein files.

Yeah.

I mean, this is the maddening thing I've seen, and you've seen over and over again, both political parties, all levels of government running on a campaign saying we're going to be transparent, and when the time comes, yeah, no, we're not going to be so transparent after him.

So, Jason, what's the takeaway?

When I talked to Ron Wyden, he said money laundering charges would have been a centerpiece in what he called any serious prosecution of Epstein.

He said, resolving the federal money laundering case is part of the government's non prosecution agreement was a staggering This charriage of justice, and another expert I spoke with, a former top money laundering prosecutor, said if the money laundering investigation had continued, it's possible that prosecutors may have been able to identify other individuals and institutions that facilitated Epstein's sex trafficking operation or recovered more restitution for his victims.

And beyond that.

It's a reminder that there's just more to the Epstein story, and you can see how the prosecutor's files could shed some light on one of the central mysteries of Epstein, the source of his money.

If prosecutors were following the money long before the public demand full accounting of his case, what other evidence might they have gathered.

In that presumably is still in the files.

So that's it for this week.

Since this is a special episode, we won't have a public episode now next week, but subscribers will be able to access our next episode then and you won't want to miss it.

Here's why we should estimate how many presidential records would fit inside the toilet.

There were these big sinkholes both at the White House and on mar A Lago's lawn.

Matt sinkholes, sinkholes.

There is a chance that some intrepid splunkers could find these documents in the sewers system.

Either I want to go on a sewer tour.

You really want to go on a sewer tour?

This feels like I don't know a Nicholas Cage movie That's next Tuesday.

Early access for subscribers from Bloomberg and No Smiling.

This is Disclosure.

The show is hosted by Matt Topic and me Jason Leopold.

It's produced by Heather Schroing and Sean Cannon for No Smiling.

Our editor for Bloomberg is Jeff Grocott.

Our executive producers for Bloomberg are Sage Bauman and me Jason Leopold, and our executive producers for No Smiling are Sean Cannon, Heather Schrowing and Matt Topic.

The Disclosure theme song is by Nick, with additional music by Nick and Epidemic Sound.

Sound design and mixing is by Sean Cannon.

Special thanks to my co authors on this story, Jeff cow Max Abelson, Harry Wilson, Afa Benni Morrison, and ser Yarmantu.

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What's up Ella?

She only wants to growl at being up.

Rip my face off, I

Said, get your punk inside, girl,