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December 13th, 2019

Justice

The next Epstein drama: Fighting over his mysterious estate

Chris Dolmetsch

By Chris Dolmetsch Bloomberg

Published August 13, 2019

 The next Epstein drama: Fighting over his mysterious estate
With opulent homes, a Caribbean island and a private jet to Jeffrey Epstein's name, the battle to claim his assets is on.

Even as questions swirl around the former financier's death while in federal custody, attention will shift this week to the next drama: identifying what's in his estate, who can claim his assets and which jurisdiction takes up the case. Lawyers seeking compensation for victims of his alleged sex crimes are calling for a freeze on the estate, raising the prospect of a legal process that could drag out for years.

It's unclear whether Epstein, who wasn't married and has no known children, left a will. What is known is that his wealth included a $77 million, 40-room mansion on New York's Upper East Side, the island of Little St. James in the U.S. Virgin Islands, a ranch in New Mexico and homes in Paris and Palm Beach, Florida. His business was registered in the Virgin Islands.

"It's going to be incredibly complicated," said David Ring, an attorney in Los Angeles who has represented victims of sexual abuse and assault. "It's going to be a lot of different folks who are going to be battling over this estate and these assets and I hope the victims come out on top. I think they deserve it. But I don't think the estate is just going to hand it over to them."

Epstein's known relatives include his brother, Mark, and a niece and nephew, who live in New York.

Mark Epstein and a friend had offered to guarantee a bond as part of his brother's bail request, which was denied. Epstein was awaiting trial on federal charges with sexually trafficking underage girls when he died on Saturday at age 66 in an apparent suicide.

While the criminal case against Epstein closed with his death, his accusers have brought numerous civil lawsuits. Investigators gathered more evidence when they searched Epstein's New York townhouse after his arrest, including photographs of what appeared to be naked underage girls.

Attorney Lisa Bloom, who represents three female plaintiffs, called on his estate's administrators to freeze all of his assets.

"Our civil cases can still proceed against his estate," Bloom said on Twitter. "Victims deserve to be made whole for the lifelong damage he caused. We're just getting started."

That will involve trying to establish the full scope of what U.S. prosecutors called Epstein's "vast fortune," which is more difficult now that he's dead. Based on limited financial records, prosecutors estimated he made $10 million a year and had a net worth of at least $500 million. But details of his assets remained "largely concealed" from the New York court, according to prosecutors.

Where estate proceedings might play out depends partly on which of Epstein's homes is considered his main one.

Documents submitted by his lawyers in a bail request after his arrest in July indicated his primary residence was his compound on the island of Little St. James in the U.S. Virgin Islands. But New York or Florida also appear to be good possibilities.

In New York, primary residence is defined as "the county where the decedent lived and considered their primary home address before they died." If a person had more than one home, it would be the place where they "intended to return."

Wherever any will is filed, it would first go through the probate process, where a judge determines whether it's a valid statement of what Epstein wanted to happen with his property after his death.

Once the will is determined to be valid, an executor named by the decedent would be officially appointed to divide up their estate.

The process would be overseen by the Superior Court in the Virgin Islands and the Surrogate's Court in New York. In Florida, the will would have to be filed by the executor of the estate within 10 days of receiving notice of a death in a court in the county where the person lived.

Prosecutors could still seek to seize individual assets through a civil forfeiture proceeding if they determine that the property was used to facilitate a crime or was the proceeds of criminal activity, said Sharon Cohen Levin, a former federal prosecutor who headed the Southern District of New York's money laundering and asset forfeiture unit.

They would have to file a complaint against an individual asset, such as Epstein's New York mansion, lay out the basis for the underlying crime and the evidence showing it was committed -- similar to the indictment -- and prove how it was it was used to facilitate the crime, Levin said.

Unlike in a criminal case, prosecutors would only have to prove that the crime more than likely occurred, not that it was beyond a reasonable doubt.

"It could literally be the same case," Levin said. "Maybe there are other people they might be charging. There might be other theories. But this is something I would assume they would be seriously considering."

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