An overnight article from the Times is the first to press past questions about Jeffrey Epstein’s wealth to suggesting that – like Donald Trump – it may all simply be an illusion. No one disputes that he’s a very wealthy man by any normal standard. He appears to own almost a quarter of a billion in real estate alone. But the claims of being a billionaire or running a fund which manages tens of billions of dollars appears to be based on very little.
The Times article points to a 2002 document – from what appears to have been Epstein’s peak – which appears to show his firm had roughly $100 million under management. A ton of money, but not remotely the scale that claims about him and his wealth would suggest. He appears to have had about 20 employees, not the 150 employees contemporary articles claimed. As one TPM Reader explained yesterday, “It’s not plausible that this guy is running some multi billion $ AUM hedge fund as a one man show. It just does not work that way. The investing overhead, if you will, let alone the operational facets of the business make it an absolute impossibility.” Twenty employees makes sense if it was a far more limited operation than the myths suggest. A lot of the actual deals, at least in Epstein’s early years, were failed corporate raids and much lower rent debt collection plays.
What all seem to agree is that his rise rested with two men. First, a guy named Steven J. Hoffenberg, one-time owner of The New York Post who did almost twenty years in prison for financial fraud. Hoffenberg later claimed that the scams that landed him in jail had Epstein in a leading role, though he was never charged with any crime.
The next was Leslie Wexner, the billionaire founder of various clothing brands including The Limited and Victoria’s Secret. Epstein met and somehow charmed Wexner. He did more than manage his money. They seemed to conjoin their business entities and lives with some properties flowing into Epstein’s hands in ways and for reasons that just aren’t that clear. Even the ownerships of the vast collection of real estate is murky. Some of it seems simply to have been transferred from entitles controlled by Wexner to ones controlled by Epstein, without the kinds of public property transfer records and deeds of ownership that ordinary mortals need to file with local governments.
This passage from the Times captures it …
In 1988, when Mr. Epstein was still working for Mr. Hoffenberg, he formed the investment firm that would be the nexus for his connections to powerful people: J. Epstein & Company. One of those people, Mr. Wexner, would become the apparent foundation of Mr. Epstein’s riches.
Mr. Epstein met — and evidently charmed — Robert Meister, the vice chairman of the insurance giant Aon, on a flight from New York to Palm Beach, Fla., according to an account by the novelist James Patterson in his nonfiction book “Filthy Rich.”
Mr. Meister, who could not be reached for comment, introduced Mr. Epstein to Mr. Wexner. There appears to have been a near instant rapport.
Robert Morosky, who had been the vice chairman of The Limited, was surprised Mr. Wexner took to Mr. Epstein so readily. “Everyone was mystified as to what his appeal was,” Mr. Morosky said. “I checked around and found out he was a private high school math teacher, and that was all I could find out. There was just nothing there.”
Epstein had some hold on Wexner, the origin of which no one seemed to understand. He was as the Times say the origin of his financial rise and Wexner only cut him off after the 2008 prostitution plea deal. It leaves the whole story even less clear, at least how Epstein’s wealth or claims about his wealth might tie into the abuse and assault of underaged girls and connections to powerful politicians and plutocrats.
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