EFTA Document EFTA01481091

Confidential Due Diligence Report — YHS, LLC ht 2006 The New York Times Company The New York Times September 3, 2006 Sunday Late Edition - Final SECTION: Section 1; Column 1; National Desk; Pg. 19 LENGTH: 1227 words HEADLINE: Questions of Preferential Treatment Are Raised in Florida Sex Case BYLINE: By ABBY GOODNOUGH DATELINE: PALM BEACH, Fla. BODY: In the summer and autumn of last year, when most of the mansions here stood empty behind their towering hedges, the police stealthily watched one at the end of a waterside lane. They monitored the comings and goings of its owner's private jet, subpoenaed his phone records and riffled through his trash. The owner was Jeffrey Epstein, 53, an intensely private New York money manager with several billionaire clients. Months earlier, the stepmother of a 14-year-old girl told the Palm Beach police that a wealthy older man, whom the girl later identified as Mr. Epstein, might have had inappropriate sexual contact with her. In sworn statements to the police, the 14-year-old and other teenage girls said a friend had arranged for them to visit Mr. Epstein's home and give him massages, usually in their underwear, in exchange for cash. Most of the girls, according to the police, said Mr. Epstein had masturbated during the massages, and a few said he had penetrated them with his fingers or penis. They identified him in photos and accurately described the inside of his home. Some recalled that his employees had fed them snacks or rented them cars. Mr. Epstein pleaded not guilty in August to the crime he was ultimately charged with, soliciting prostitution. But at a time when prosecutors around the nation have become increasingly severe in dealing with people accused of sex offenses, the case has raised questions about whether Mr. Epstein's prominence won him preferential treatment. By the account of the police, they found probable cause to charge Mr. Epstein with much more serious offenses: one count of lewd and lascivious molestation and four counts of unlawful sexual activity with a minor. But instead of proceeding with such charges on his own, the Palm Beach County state attorney took the rare step of presenting a broad range of possible charges to a grand jury, which indicted Mr. Epstein in July on the lesser count. In Florida, prosecutors usually refer only capital cases to grand juries. Even before the indictment, the Palm Beach police chief, Michael Reiter, had accused prosecutors of giving Mr. Epstein special treatment and asked the state attorney, Barry E. Krischer, to remove himself from the case. In an editorial, The Palm Beach Post attacked Mr. Krischer, a Democrat whose post is elective, saying the public had been left "to wonder whether the system tilted in favor of a wealthy, well- connected alleged perpetrator and against very young girls who are alleged victims of sex crimes." The case has taken a toll on the reputation of Mr. Epstein, owns a palatial home in Manhattan, has mlod-ed $30 million to Harvard and once flaw f President Bill Clinton on his Confidential - This report is not to be disseminated or photocopied to any third party without the express consent of Global Corporate Security. Confidential Treatment Requested by JPMorgan Chase CONFIDENTIAL JPM-SDNY-00003352 SDNY_GM_00272550 EFTA01481091