Government of the United States Virgin Islands v. JPMorgan Chase Bank, N.A., No. 122-cv-10904 (S.D.N.Y. 2022)/326-14.pdf

EXHIBIT 14 Case 1:22-cv-10904-JSR Document 326-14 Filed 09/08/23 Page 1 of 14 Confidential - Pursuant to Protective Order Golkow Litigation ServicesPage 1 1 UNITED STATES DISTRICT COURT 2 FOR THE SOUTHERN DISTRICT OF NEW YORK 3 * * * * * * * * * * * * * * * 4 GOVERNMENT OF THE UNITED STATES VIRGIN ISLANDS, 5 Plaintiff, 6 vs. Case No. 1:22-cv-10904-JSR 7 JPMORGAN CHASE BANK, N.A., 8 Defendant/Third-Party Plaintiff. 9 * * * * * * * * * * * * * * * 10 JPMORGAN CHASE BANK, N.A., 11 Third-Party Plaintiff, 12 vs. 13 14 JAMES EDWARD STALEY, 15 Third-Party Defendant. 16 * * * * * * * * * * * * * * * 17 **** CONFIDENTIAL - PURSUANT TO PROTECTIVE ORDER **** 18 19 VIDEOTAPED DEPOSITION OF WILLIAM MARCUS SHERIDAN 20 TAKEN AT: Greenbaum, Rowe, Smith & Davis LOCATED AT: 75 Livingston Avenue 21 Roseland, NJ 22 July 12, 2023 9:01 a.m. to 3:00 p.m. 23 REPORTED BY ANITA KORNBURGER 24 REGISTERED PROFESSIONAL REPORTER 25 Case 1:22-cv-10904-JSR Document 326-14 Filed 09/08/23 Page 2 of 14 Confidential - Pursuant to Protective Order Golkow Litigation ServicesPage 35 1 Q. And then it says, "The banker and the 2 senior manager must approve the updated DDR." 3 So when you have an updated DDR before 4 you -- 5 A. Yep. 6 Q. -- and if you saw information that was 7 concerning, have you ever had an instance where you 8 just refused to sign the DDR? 9 A. I can't -- I actually don't recall. 10 Q. If you had refused to sign a DDR, would 11 that have required more meetings, do you think, 12 before a client had been exited? 13 A. Wait. Can you say that again? 14 Q. If you had refused to sign the DDR, do 15 you think that would have necessitated more 16 meetings with others, or there would have been more 17 activity about the client? 18 A. There could -- 19 MR. CONERY: Object to form. Go ahead. 20 THE WITNESS: You have to understand that 21 there's the DDR, which reflects the banker's 22 summary and interpretation of the relationship, but 23 in addition to the KYC, the DDR that would come to 24 me, there's also, as we talked about earlier, a lot 25 of interaction day to day in terms of each client Case 1:22-cv-10904-JSR Document 326-14 Filed 09/08/23 Page 3 of 14 Confidential - Pursuant to Protective Order Golkow Litigation ServicesPage 36 1 relationship and what's going on with those 2 relationships. 3 So there's -- you know, when 4 I look at a DDR, I should be aware of and 5 know -- know clients for -- for each of my bankers, 6 particularly those that may be more higher profile. 7 BY MR. BAYERL: 8 Q. Okay. But if you refused -- doesn't have 9 to be you -- if a senior manager refused to sign a 10 DDR, would that prevent the client from continuing 11 or becoming a client of the bank? 12 A. I can't speculate what another senior 13 manager would or would not do, or what that 14 consequence would be. 15 Q. Fair. If you refused to sign a DDR for a 16 client or a prospective client, would that have 17 meant the client needed to exit the bank? 18 A. Not necessarily. 19 Q. Okay: All right. Let's move to the page 20 ending in 758. 21 A. 758. 22 Q. You see at the bottom of the page there's 23 an underlined "convicted felons"? 24 A. I see that. 25 Q. Okay. And the first sentence says, "The Case 1:22-cv-10904-JSR Document 326-14 Filed 09/08/23 Page 4 of 14 Confidential - Pursuant to Protective Order Golkow Litigation ServicesPage 45 1 THE WITNESS: So my involvement was as a 2 banker. So this was a referral from a well-known 3 client that I work with who I onboarded. And then, 4 as public information became available with respect 5 to his tax evasion and conviction, I talked with 6 the -- with my client who provided the referral and 7 suggested this was not -- not the right profile for 8 me as a banker to have this individual as a client 9 given the circumstances, and that we offloaded 10 them -- or offboarded them. 11 BY MR. BAYERL: 12 Q. Okay. So you can tell me if I'm 13 misunderstanding what you said. You learned 14 through public sources that this referral was 15 convicted of tax evasion or alleged to have engaged 16 in tax evasion? 17 A. Through public sources, but which was 18 provided to me through the apparatus I described 19 earlier. 20 Q. Right. And then you went to the 21 client's -- to the referral source to discuss the 22 facts of the tax evasion? 23 A. Right, to make sure that we had the right 24 understanding. 25 Q. And then you, the banker, made the Case 1:22-cv-10904-JSR Document 326-14 Filed 09/08/23 Page 5 of 14 Confidential - Pursuant to Protective Order Golkow Litigation ServicesPage 46 1 decision that you did not want to continue business 2 with that client? 3 A. This was a -- an individual that was not 4 known to anyone else within the firm. They did not 5 have business with anyone else in the firm. Had 6 they had had other connections or connectivity with 7 people in the firm or other lines of business in 8 terms of their doing business with them, I 9 absolutely would have had a conversation. 10 So it -- what I want to make clear is 11 that no banker will make a rogue decision without 12 clearly thinking through the touch points with that 13 individual or family. Again, what I said earlier 14 is many of our clients are high profile and have 15 multiple touch points. So it's -- perhaps it's not 16 written in black and white in any kind of policy, 17 but the -- you know, in terms of -- of doing your 18 job and being smart about doing your job, you're 19 going to talk to the appropriate people or not 20 within your organization, if that makes sense to 21 you. 22 Q. Right. So the takeaway, then, is for 23 some clients, it is within the banker's discretion 24 to exit them unilaterally, and other clients who 25 are perhaps more high profile, it requires a larger Case 1:22-cv-10904-JSR Document 326-14 Filed 09/08/23 Page 6 of 14 Confidential - Pursuant to Protective Order Golkow Litigation ServicesPage 47 1 familiar with this document, but you're familiar 2 with this policy in general; right? 3 A. The policy and the content -- and 4 the -- the nature of high risk in general, yes. 5 Q. Okay. And this is also a policy that you 6 would have discussed or gone over with your bankers 7 that you were supervising? 8 A. That's correct. 9 Q. Okay. Let's flip to the page that ends 10 in 566. And at the bottom of the page, there's a 11 paragraph that starts with "high profile figure." 12 Do you see that? 13 A. Uh-huh. 14 Q. It says, "For purposes of this procedure, 15 a high profile figure is a person who is identified 16 in the course of normal account opening maintenance 17 or compliance procedures, to be a person of 18 prominence, e.g., a national celebrity such as an 19 actor/actress, athlete, a business figure, and who 20 has received the controversial so-supposed 21 additional reputation risk to the firm." Do you 22 see that? 23 A. I do. 24 Q. What did you understand the phrase 25 "reputation risk" to mean? Case 1:22-cv-10904-JSR Document 326-14 Filed 09/08/23 Page 7 of 14 Confidential - Pursuant to Protective Order Golkow Litigation ServicesPage 74 1 What was your basis for that? 2 A. I mean, Jes was intimately involved in 3 really every aspect of what we did with Jeffrey 4 Epstein, and was viewed as the senior banker by 5 virtue of the things that they did with respect to 6 certain introductions of prospects, involvement in 7 the high bridge transact