EFTA00289782.pdf

11,05107 la 002/003 MON 10:05 FAX 305 530 a440 EXECUTIVE OFT, CE gaMm, 10002 fi ileitea\ Department of Justice United Stow Attontey Southern District of Florida 99 N.G. 4th Soca Miami, FL 33132-V11 (305) 961.9299 Futuinurk: (305)530-6414 November 5.2007 DELIVERYIX FSCS2411.1j Jay P. Lefkowitz, Esq. Kirkland & Ellis UP Citigroup Center 153 East 53rd Street New Yodc, New York 10022,-4675 Re: Jeffrey lipstein Dear Jay: Several things have come to my attention by his obligations under the Non-Prosecuti that seem contrary to your client inte nding to abide on Agreement. As you know, that Office to inform you of potential breaches agreement requires our to give you and your client the opportu before an indictment is filed. At this nity to respond time, I do however, I have sufficient concerns that need not believe that the agreement has been breached; to be addressed. First, T understand that private inve stigators working for Mr. Epstein have to ask them whether any detectives or FBI contacted victims agents have discussed a financial settl On one occasion, the private investigators told ement with them. the parent of a victim that she for her daughter and she should do so should get an attorney right away. These actions are trou agents legally arc required to advise blesome because the P131 the victims of the resolution of the mat informing them that, as pan of the ter, which includes resolution, that Mr. Epstein has agre circumstances. Furthermore, Mr. Epstein ed to pay damages in some well knows that we are in the proc attorney to represent the victims and ess of selecting an , but for the inordinate amount of time Addendum, that attorney would already spen t negotiating the have been selected. Paragraph 7 of Agreement explicitly provides the Nun-Prosecution that contact with the victims shall Accordingly, please canine' that ther .be through that counsel. e will be no further efforts to contact any Davis selects the attorney representative victims until fudge and that, thereafter, contact will counsel. be made only through that Second, the Non-Prosecution Agreement requires Mr. Epstein Muse his guilty plea and to be sentenced not his best efforts to enter later than October 26, 2007. Despite Office agreed that Mr. Epstein coul this obligation. the d postpone this deadline to November, but reiterated that Mr. EFTA00289782  003/003 11 /05 /V MON 10:00 FAX 305 530 5440 ere:cirri v8 OFFICE rdloo3 JAY P. I.Encowrtz. Esc, Neveniast 5.2007 Pace 2 OF 2 Epstein had to begin his term of inca rceration not later than January 4, 2008. I have November hearing has been removed from learned that the the calendar and the next case disposit not been set until January 7.2008. This dela ion conference has y is unacceptable, and, pursuant to you Office requests that you confer with the State r obligations, the Attorney's Office to try to find a date in when the judge is available toconduct a November simultaneous plea and sentencing. If you a date. please provide documentation cannot find such of your efforts to abide by the term Agreement. s of the Non-Prosecution Third, there have been several press reports that Mr. Epstein no longer inte guilty plea. Normally I would not pay any atten nds to enter a tion to Such reports, but your recent correspo attempting to restrict our Office from ndei we communicating with the State Attorney allusion to the Imposition of sentences 's Office and the that dearly fall outside die terms of Agreement raises concern. Please confirm the Non-Prosecution that Mr. Epstein intends to abide by plead guilty to the specified char his agreement to ges and to make a binding recommendation a sentence of 18 months of continuous that the Court impose confinement in the county jail. Finally, MeNon-Prosecution Agreentaatrequ all proposed agreements with the Stat ims that you provide the Office with copi e Attorney's Office before Mr. Eps es of agreements. To date, no such agreements tein signs any such havebeen received. Please provide Inc with and all agreements with the State Attorney copies of any 's Office for our review. The Office also have someone present at the change ofplea would like to and sentencing to monitorMr. Epstein's com the terms of the Non-Prosecution Agreem pliance with ent, so please keep me informed of location of the hearing. the date, time, and Please provide me with a written response, adopted by Mr. Epstein, concerns and reiterating Mr. 13pstein 'a inte addressing these ntion to comply with the terms or Agreement by November 8, 2007. the Non-Prosecution Sincerely, It, Alexander ACO5Ut cc: It. Alexander ttomey By: a stant United States Attorney EFTA00289783  05/16/2008 11:18 FAX "Ina • 05/16/08 FRI 11:08 FAx UNITED STATES DEPARTME Criminal Divisio Child Exploitation and Obsc L 1400 New York Avenue, NW Suite 600 bq Washington, DC 20530-0001 2000 5 TO: .R- Alexander Acosta, Esq. Jay I.e£kowitz, Esq. Okt-ICE NUMBER: FAX NUMBER: FROM: e>er lalb DATEIIIME May 16, 2008 OFFICE NUMBER: NUMBER OF PAGES. EXCLUDING THIS SHEET: 5 SPECIAL INSTRUCTIONS: EFTA00289784 . 06/16/2008 11:16 FAX Q002/006 ' 06/16/08 FRI II:08 FAX ej002 U.S. Department of Justice Criminal Division Andrew G. Oosterbaan, Chief CUM aoloitenion and OfraunkySentan 14014m Yak Angus. NW Suite 600 Warldift0m. DC20130 P02)514-5780 FAX: (207)1/4.1793 May 15, 2008 Jay Lefkowitz, Esq. Kirkland & Ellis LLP Citigroup Center 153 E. 53111St. New York, NY 10022-4611 Re: Investigation of Epstein Dear Mr. Lefkowitz: Pursuant to your request and the request of independently evaluated certain issues rais U.S. Attorney R. Alexander Acosta, we hav ed in the investigation of Jeffrey Epstein e whether a decision to prosecute Mr. Epstein to determine for federal criminal violations would criminal enforcement policy interests, As contradict part of our evaluation, we have reviewe written on behalf of Mr. Epstein on Feb d letters ruary 1, 2007, June 25, 2007, July 6, 2007, 2008, April 8, 2008, April 28, 2008, and May March 28, 14, 2008, with their attachments. We hav reviewed memos prepared by the U.S. e also Attorney's Office. As you will recall, we and other representatives of Mr. Epstein to furt met with you her discuss your views on the prop federal prosecution. We have discussed the riety of a factual and legal issues you raise with Division's Appellate Section, and we the Criminal consulted with the Office of Enforcement concerning the petite policy. Operations We are examining the narrow question as to whether there is a legitimate basi U.S. Attorney's Office to proceed with a s for the federal prosecution of Mr. Epstein. prosecutorial decision making authority Ultimately, the within a U.S. Attorney's Office lies Attorney. Therefore, to borrow a phra with the U.S. se from the case law, the question we was whether U.S. Anorncy Acosta wou sought to answer ld abuse his discretion if he authoriz case. ed prosecution in this As you know, our review of this case is looked at the entire universe of facts limited, both fketually and legally. We in this case. It is not the role of the have not conduct a complete factual inquiry from Criminal Division to re- scratch. Furthermore, we did not concerning prosecution under federal analyze any issues statutes that do not pertain to child exp money laundering statutes. loitation, such as the EFTA00289785 05/16/2008 11:16 FAX g)003/006 05/18/08 PRI 11:08 FAX e 003 As was made clear at the outset, we did not review the facts, circumstances, or terms included in the plea offer, nor any allegations that individuals involved in the investigation engaged in misconduct. Despite that agreement, we note that your letters of April 8, April 28, and May 14 focus in large part on accusations of inve stigative or prosecutorial misconduct. Not only do allegations of prosecutorial miscond uct fall outside the boundary of our agreed they also fall outside the authority of the Criminal review, Division in the first instance. Simply, the Criminal Division does not investigate or reso lve allegations of professional misconduct federal prosecutors. For these reasons, we do by not respond to the portion of those lette discuss alleged misconduct. rs that Based on our review of all of these materials, and we conclude that U.S. Attorney Acosta coul after careful consideration of the issues, d properly use his discretion to authorize pros in this case. We will briefly address each of, the ecution issues that you have raised. Knowledge ofage. Federal child exploita tion statutes differ as to whether there mus proof that the defendant was aware that the chil t be dren were under the age of 18. How For those statutes where knowledge of age is ever, even an element of the offense, it is possible that element with proof that the defendant was to satisfy deliberately ignorant of facts which would that the person was a minor, For that reas suggest on, the fact that some of the individuals alle to Mr. Epstein about their age is not dispositi ged ly lied ve of the issue. While there may be an issue as to Mr. Epstein's knowledge, we cann open factual ot say that it would be impossible to prove knowledge of age for any such charges whi ch require it. Therefore, Mr. Acosta coul righ conclude that this factual issue is best reso d tfully lved by a jury. Travelfor the ptripose. in the materials you prepared, you suggest that Mr. Epstein should not be charged with violating 18 U.S .C. § 2423(b) because his dominant purp to Florida was not to engage in illegal sexu ose in going al activity, but rather to return to one While we fully understand your argumen of his residenecs. t, we also find that the U.S. Attorney's faith basis fully to develop the facts on this office has a good issue and brief the law to permit a cour whether the law properly reaches such t to decide conduct. Mr. Acosta would not be abusing his if he decided to pursue such a course of discretion action. Intent to engage In the conduct at the time this ease, we respectfidly disagree that of travel. Based on our review of the fact there is no evidence concerning Mr. s of he traveled, and when that intent was form Epstein's intent when ed. Should Mr. Acosta elect to let the that a jury can resolve this factual issue, case proceed so he would be within his discretion to do so. Use of a facility or means of interstate or have prepared and much of the meeting we foreign commerce. Much of the mat erials you had focused on 18 U.S.C. § 2422(b), contention that Mr. Epstein did not use specifically your the phone to coerce anyone to engage activity. We understand the issue in illegal sexual you raise concerning the statutory however, we cannot agree that ther interpretation. As before, e is no evidence that would support a 2422(b), nor can we agree that there charge under Section is no argument in support of the applica this case. Finally, our assessment is that the tion of that statute to application of that statute to these facts would not be 2 EFTA00289786 06/16/2008 11:16 FAI bliOS/006 06/18/08 FRI 11:09 FAX 1:9004 so novel as to implicate the so-called "clear statement rule," the Ex Post Facto clause, or the Due Process clause. As with the other legal issues, Mr. Acosta may elect to proceed with the case. Absence of coercion. With respect to 18 U.S.C. § 1591, the allege d absence of the use of force, fraud, or coercion is of no moment. The statute does not require the use of force, fraud, and coercion against minors. Because of their age, a degree or coercion is presumed. In your materials, you note that the statute requires that the minors must be "caus ed" to engage in a commercial sex act, further arguing that the word "cause" sugge sts that a certain amount of undue influence was used. We reject that interpretation, as it would read back into the offense an element-coercion-that Congress has expressly excluded We have successfblly prosecuted defendants for the commercial sexual exploitation of minors, even when the minors testified that not only did they voluntarily engage in Ihe commercial sex acts, it was their idea to do so. As such, Mr. Acosta could properly decide to pursue charges under Sectio n 1591 even if there is no evidence of coercion. More broadly, a defendant's criminal liability does not hinge on his victim having suffered at his bands. Therefore, a prosecution could proce identifying as ed, should Mr. Acosta decide to do so, even though some of the young women allegedly have said that they do not view themselves as victims. Witness credibility. As all prosecutors know, them are no perfect witnesses. Particularly in cases involving exploited children, as one member of your defen se team, Ms. Thacker, surely knows from her work at acts, it is not uncommon for victim -witnesses to give conflicting statements. The prosecutors are in the best position to assess the witness's credibility. Often, the prosecutor may decide that the best approach is to present the witne ss, let defense counsel explore the credibilityprobleras on cross-examination, and let the jury resolve the issue. Mr. Acosta would be within his authority to select that approach, espec ially when here there arc multiple, mutually-corroborating witnesses. Contradictions and omissions in the search warrant applic ation. We have carefully reviewed the factual issues you raise concerning the search warrant application. For a search warrant to be suppressed, however, the factual errors must be material, and the officers must not have proceeded in good faith. Despite the numerous factual errors you describe, the U.S. Attorney's Office could still plausibly argue that the mista kes—whether inadvertent or intentional—were not material to the determination that probable cause existed for a search, and that the search was in good faith in any event. As such, Mr. Acost a could properly elect to defend the search warrant in court rather than forego prosecution. Petite Policy: After reviewing the petite policy and consulting with the Office of Enforcement Operations MEG", we conclude that the petite policy does not prohibit federal prosecution in this case. According to the U.S. Attorney's Manual, the petite policy "applies whenever there has been a prior state or federal prose cution resulting in an, acquittal, a conviction, including one resulting from a plea agreement, or a dismissal or other termination of 3 EFTA00289787 06/16/2008 11:17 FAX 0005/006 c0005 06/16/08 FRI li:00 FAX the case on the merits after jeopardy has attached." USAM 9-2.031(C). Our understanding is that the state case is still pending. As such, the procedural posture of the state case does not implicate the petite policy. We recognize that the petite policy could be triggered if the state case conclu ded after a federal indictment was issued but prior to the commencement of any federa l trial. Id. However, the policy "does not apply ... where the (state) prosecution involved only a minor part of the contemplated federal charges." USAM 9-2.031(13). Based on our understanding of the possible federal charges and existing state charges, we do not think the petite policy would be an issue should federal proceedings take place. Federalism and Prosecutorial Discretion. All of the above issues essentially ask whether a federal prosecution can proceed. We understand, however, that you also ask whether a federal prosecution should proceed, even in the event that all of the elements of a federal offense could be proven. On this issue, you raised two arguments: that the condu ct at issue here is traditionally a state concern because the activity is entirely local, and that the typica l prosecution under federal child exploitation statutes have different facts than the ones implicated here. You have essentially asked us to look into whether a prosecution would so violate federal prosecutorial policy that a United States Attorney's Office should not pursue a prosecution. We do not think that is the case here for the following reasons. Simply, the commercial sexual exploitation of children is a federal the conduct is local, and regardless of whether the defendant concern, even when provided the child (the "pimp") or paid for the child (the "John"). In your materials, you refer to a letter sent by the Department of Justice to Congress in which the Department expresses conce rn over the expansion of federal laws to reach almost all instances of prostitution. In that portio n of the letter, the Department was expressly referring to a proposed federal law that reach adult prostitution where no force, fraud, or coercion was used. Indeed, the point being made in that letter is that the Department's efforts are properly focused on the commercial sexual explo itation of children and the exploitation of adults through the use of force, fraud, or coercion. As such, there is no inconsistency between the position taken in that letter and the federal prosecution of wholly local instances of the commercial sexual exploitation of childr en. If Congress wanted to limit the reach of federal statutes only to those who profit from the commercial sexual exploitation of children, or only to those who actually traffic children across state lines, it could have done so. It did not. Finally, that a prosecution of Mr. Epstein might not look precisely like the cases that came before it is not dispo sitive. We can say with confidence that this case is consistent in principle with other federa l prosecutions nationwide. As such, Mr. Acosta can soundly exercise his authority to decide to pursue a prosecution even though it might involve a novel application of a federal statute. Conclusion. After carefully considering all the factua the arguments concerning the general propriety of l and legal issues raised, as well as a federal case against Mr. Epstein on these 4 EFTA00289788 05/36/08 FRI 11:10 FAX facts, we conclude that federal prosecution in this case would net be improper or inappropriate. While you raise many compelling arguments, we do not sec anything that says to us categorically that a federal case should not be brought. Mr. Acosta would not be abusing his prosecutorial discretion should he authorize federal prosecution of Mr.;Ostci Since(ivv au co: AAG tam DAAG U.S. Attorney R. Alexander Acosta EFTA00289789  U.S. Department of Justice United States Attorney Southern District of Florida 5001 Australian Ave, Ste 400 West Palm Beach, FL 33401 (561)820-8711 Facsimile: (561) 820.8777 December 13, 2007 DELIVERY BY ELECTRONIC MAIL Jay P. Lefkowitz, Esq. Kirkland & Ellis LLP Citigroup Center 153 East 53rd Street New York, New York 100224675 Re: Jeffrey Epstein Dear Jay: I am writing not to respond to your asserted "policy concerns" regarding Mr. Epstein's Non- Prosecution Agreement, which will be addressed by the United States Attorney, but the time has come for me to respond to the ever-increasing attacks on my role in the investigation and negotiations. It is an understatement to say that I am surprised by your allegations regarding my role because I thought that we had worked very well together in resolving this dispute. I also am surprised because I feel that I bent over backwards to keep in mind the effect that the agreement would have on Mr. Epstein and to make sure that you (and he) understood the repercussions of the agreement. For example, I brought to your attention that one potential plea could result in no gain time for your client; I corrected one of your calculations of the Sentencing Guidelines that would have resulted in Mr. Epstein spending far more time in prison than you projected; I contacted the Bureau of Prisons to see whether Mr. Epstein would be eligible for the prison camp that you desired; and I told you my suspicions about the source of the press "leak" and suggested ways to avoid the press. Importantly, I continued to work with you in a professional manner even after l learned that you had been proceeding in bad faith for several weeks — thinking that I had incorrectly concluded that solicitation of minors to engage in prostitution was a registrable offense and that you would "fool" our Office into letting Mr. Epstein plead to a non-registrable offense. Even now, when it is clear that neither you nor your client ever intended to abide by the terms of the agreement that he signed, 1 have never alleged misconduct on your part. The first allegation that you raise is that I "assiduously" hid from you the fact that Bert Ocariz is a friend of my boyfriend and that I have a "longstanding relationship" with Mr. Ocariz. EFTA00289790 • LAY P. LEFKOWITZ, ESQ. DECEMBER 13,2007 PACE 2 OF 5 I informed you that I selected Mr. Ocariz because he was a friend and classmate of two people whom I respected, and that I had never met or spoken with Mr. Ocariz prior to contacting him about thil case. All of those facts are true. I still have never met Mr. Ocariz, and, at the time that he and I spoke about this case, he did not know about my relationship with his friend. You suggest that I should have explicitly informed you that one of the referrals came from my "boyfriend" rather than simply a "friend," which is the term I used, but it is not my nature to discuss my personal relationships with opposing counsel. Your attacks on me and on the victims establish why I wanted to find someone whom I could trust with safeguarding the victims' best interests in the face of intense pressure from an unlimited number of highly skilled and well paid attorneys. Mr. Ocariz was that person. One of your letters suggests a business relationship between Mr. Ocariz and my boyfriend. This is patently untrue and neither my boyfriend nor I would have received any financial benefit from Mr. Ocariz's appointment. Furthermore, after Mr. Ocariz learned more about Mr. Epstein's actions (as described below), he expressed a willingness to handle the case pro ban°, with no financial benefit even to himself. Furthermore, you were given several other options to choose from, including the Podhurst firm, which was later selected by Judge Davis. You rejected those other """ options. You also allege that I improperly disclosed information about the case to Mr. Ocariz. I provided Mr. Ocariz with a bare bones summary of the agreement's terms related to his appointment to help him decide whether the case was something he and his firm would be willing to undertake. I did not provide Mr. Ocariz with facts related to the investigation because they were confidential and instead recommended that he "Google" Mr. Epstein's name for background information. When Mr. Ocariz asked for additional information to assist his firm in addressing conflicts issues, I forwarded those questions to you, and you raised objections for the first time. I did not share any further information about Mr. Epstein or the case. Since Mr. Ocariz had been told that you concurred in his selection, out of professional courtesy, I informed Mr. Ocariz of the Office's decision to use a Special Master to make the selection and told him that the Office had made contact with Judge Davis. We have had no further contact since then and I have never had contact with Judge Davis. I understand from you that Mr. Ocariz contacted Judge Davis. You criticize his decision to do so, yet you feel that you and your co-counsel were entitled to contact Judge Davis to try to "lobby" him to select someone to your liking, despite the fact that the Non-Prosecution Agreement vested the Office with the exclusive right to select the attorney representative. Another reason for my surprise about your allegations regarding misconduct related to the Section 2255 litigation is your earlier desire to have me perform the role of"facilitator" to convince the victims that the lawyer representative was selected by the Office to represent their interests alone and that the out-of-court settlement of their claims was in their best interests. You now state that doing the same things that you had asked me to do earlier is improper meddling in civil litigation. Much of your letter reiterates the challenges to Detective Recarey's investigation that have EFTA00289791 JAY RLEFKOATIZ, ESQ. DECEMBER 13, 2007 PAGE 3 OF 5 already been submitted to the Office on several occasions and you suggest that I have kept that information from those who reviewed the proposed indictment package. Contrary to your suggestion, those submissions were attached to and incorporated in the proposed indictment package, so your suggestion that I tried to hide something from the reviewers is false. I also take issue with the duplicity of stating that we must accept as true those parts of the Recarey reports and witness statements that you like and we must accept as false those parts that you do not like. You and your co-counsel also impressed upon me from the beginning the need to undertake an independent investigation. It seems inappropriate now to complain because our independent investigation uncovered facts that are unfavorable to your client. You complain that I "forced" your client and the State Attorney's Office to proceed on charges that they do not believe in, yet you do not want our Office to inform the State Attorney's Office of facts that support the additional charge nor do you want any of the victims of that charge to contact Ms. Belohlavek orate Court. Ms. Belohlavek's opinion may change if she knows the full scope of your client's actions: You and I spent several weeks trying to identify and put together a plea to federal charges that your client was willing to accept Yet your letter now accuses me of "manufacturing" charges of obstruction of justice., making obscene phone calls, and violating child privacy laws. When Mr. Lourie told you that those charges would "embarrass the Office," he meant that the Office was unwilling to bend the facts to satisfy Mr. Epstein's desired prison sentence — a statement with which I agree. I hope that you understand how your accusations that I imposed "ultimatums" and "forced" you and your client to agree to unconscionable contract terms cannot square with the true facts of this case. As explained in letters from Messrs. Acosta and Sloman, the indictment was postponed for more than five months to allow you and Mr. Epstein's other attorneys to make presentations to the Office to convince the Office not to prosecute. Those presentations were unsuccessful. As you mention in your letter, I -a simple line AUSA — handled the primary negotiations for the Office, and conducted those negotiations with you, Ms. Sanchez, Mr. Lewis, and a host of other highly skilled and experienced practitioners. As you put it, your group has a "combined 250 years experience" to my fourteen. The agreement itself was signed by Mr. Epstein, Ms. Sanchez, and Mr. Lefcourt, whose experience speaks for itself. You and I spent hours negotiating the terms, including when to use "a" versus "the" and other minutiae. When you and I could not reach agreement, you repeatedly went over my head, involving Messrs. Laurie, Menchel, Siemer), and Acosta in the negotiations at various times. In any and all plea negotiations the defendant understands that his options are to plead or to continue with the investigation and proceed to trial. Those were the same options that were proposed to Mr. Epstein, and they are not "persecution or intimidation tactics." Mr. Epstein chose to sign the agreement with the advice of a multitude of extremely noteworthy counsel. You also make much of the fact that the names of the victims were not released to Mr. Epstein prior to signing the Agreement. You never asked for such a term. During an earlier meeting, where Mr. Black was present, he raised the concern that you now voice. Mr. Black and I did not have a chance to discuss the issue, but I had already conceived of a way to resolve that EFTA00289792 JAY P. LEFICOWITZ, ESQ. DECEMBER 13, 2007 PAGE 4 OF 5 issue if it were raised during negotiations. AS I stated, it was not, leading me to believe that it was not a matter of concern to the defense. Since the signing of the Non-Prosecution Agreement, the agents and I have vetted the list of victims more than once. In one instance, we decided to remove a name because, althoughthe minor victim was touched inappropriately by Mr. Epstein, we decided that the link to a payment was insufficient to call it "prostitution." I have always remained open to a challenge to the list, so your suggestion that Mr. Epstein was forced to write a blank check is simply unfounded. Your last set of allegations relates to the investigation of the matter. For instance, you claim that some of the victims were informed of their right to collect damages prior to a thorough investigation of their allegations against Mr. Epstein. This also is false. None of the victims was informed of the right to sue under Section 2255 prior to the investigation of th