Financial services company Charles Schwab facilitated the transfer of approximately $27.7 million for Jeffrey Epstein as the disgraced financier attempted to acquire an elaborate palace in Morocco during the 10 days leading up to his 2019 arrest, according to newly released Department of Justice documents.
The transactions, being disclosed publicly for the first time, reveal how the major U.S. brokerage managed Epstein’s funds during a period when he faced heightened public attention following investigative reporting by the Miami Herald in 2018.
Seven days after Epstein’s arrest, on July 13, Schwab reported the transfers as suspicious activity to the U.S. Treasury Department’s Financial Crimes Enforcement Network, the records indicate.
Analysis of over 100 documents reveals that Schwab established three accounts for Epstein’s business entities in April 2019, including one for Southern Trust, the company seeking to purchase the luxurious Bin Ennakhil palace located in Marrakesh, Morocco.
The Schwab business account designated Richard Kahn, who served as Epstein’s accountant, as the authorized representative, while Epstein was listed as Southern Trust’s president and sole beneficial owner.
From June 26 through July 9, 2019, Southern Trust directed Schwab to transfer approximately $12.7 million in euros for the property acquisition, but subsequently canceled the order. Schwab later received a new wire request bearing Epstein’s signature and processed $14.95 million for the same property, despite insufficient account funds while awaiting the return of the initial payment.
When contacted by Reuters, Schwab refused to discuss account specifics, citing federal regulations, privacy laws, and company policies requiring confidentiality.
“An associate of Epstein opened accounts in April 2019. Shortly after, our Risk team began investigating the accounts and within 60 days of starting the review, we notified the client of our decision to close and terminate the relationship. We also referred the matter to federal law enforcement,” the company stated in an email response.
Schwab would not elaborate on the exact timing of when its risk assessment team initiated its investigation.
Federal Bank Secrecy Act regulations require financial institutions to submit suspicious activity reports within 30 days of discovering concerning facts, in addition to reporting daily cash transactions exceeding $10,000 to help detect and prevent money laundering activities.
FinCEN representatives declined to provide comments. An attorney representing Kahn did not respond to inquiries from Reuters.
Marc Leon, the Morocco-based real estate agent, informed Reuters via email that Epstein initially attempted to purchase Bin Ennakhil in 2011, with negotiations over terms and pricing continuing for years.
According to a property description found in the DOJ’s document collection, Bin Ennakhil features gold-adorned walls, a hammam steam spa, 60 marble fountains, and outdoor pool and jacuzzi facilities, spanning a total area of 4.6 hectares. The listing describes multiple gardens containing hundreds of olive trees and over 2,000 palm trees, covering an area larger than New York’s Washington Square Park or approximately six standard soccer fields.
Leon also justified his involvement in facilitating Epstein’s property purchase attempt.
“Epstein had been convicted of sex crimes (in 2008) and had served his sentence. There was therefore nothing to prevent him from attempting to purchase property in Morocco. We had no way of knowing that he had continued his terrible crimes,” he explained.
Epstein died by suicide in jail during August 2019 while awaiting trial on federal sex trafficking charges.
Epstein approached Schwab in 2019 as Deutsche Bank was closing accounts belonging to the convicted sex offender, who had entered a guilty plea in 2008 for soliciting prostitution from a minor and served prison time.
Schwab was among at least seven financial institutions subpoenaed by the U.S. Virgin Islands in 2020 for documents related to Epstein’s estate co-executors. The subpoena did not identify Schwab as a defendant and included no allegations of misconduct against the brokerage.
Email communications and wire transfer documentation within the DOJ files, which may be incomplete, demonstrate that Epstein discussed acquiring the luxury Marrakesh property with his associates during spring 2019.
Southern Trust, Epstein’s company, agreed to purchase the property through Leon in March of that year.
After evaluating various financing options, the records show Epstein directed associates to transfer funds to Leon.
Schwab subsequently received instructions from Southern Trust to wire 11.15 million euros, approximately $12.7 million at that time’s exchange rate, to Leon on June 26, 2019, according to Schwab’s suspicious activity report reviewed by Reuters.
The money was sent to Leon’s Julius Baer account in Switzerland, where Leon was based at the time, the report indicates.
The following day, Schwab received a phone call from an individual whose identity is redacted in the report, requesting cancellation of the transfer. When asked for the reason, they informed Schwab that the real estate deal terms were not “agreeable.”
The caller also mentioned that another payment for a larger amount would be sent to a different account, according to the report.
Schwab successfully reversed the transaction, with funds scheduled to be credited back on July 10, the report shows.
Two days prior to Epstein’s arrest, Southern Trust instructed Schwab through a July 4 wire transfer request signed by Epstein and his co-signatory to send Leon $14.95 million, the report indicates.
Schwab stated the funds were directed to Leon’s Julius Baer account, according to the report.
However, Epstein’s Southern Trust account lacked adequate funds because Schwab had not yet returned money from the earlier transaction, the report notes.
While Schwab could reasonably expect the payment to be transferred back to Epstein’s account, the bank would have faced risk exposure until the funds were returned.
Reuters could not determine when the $12.7 million ultimately returned to Epstein’s account, but the funds were scheduled to arrive on July 10, according to the July 13-dated report.
When asked about its policy at that time for processing international wire transfers with insufficient account funds, Schwab declined to comment.
Reuters was unable to confirm whether Julius Baer accepted the transfers. A Julius Baer spokesperson declined to provide comments.
Leon stated: “The anti-money laundering checks in force were carried out by the banking institutions involved in the future transaction, which ultimately never took place.”
Not until July 9, three days following Epstein’s arrest, did Schwab cancel the second transfer at the request of an individual acting for Epstein whose name is redacted, the report shows.
An email within the other DOJ documents shows Epstein’s accountant Kahn requested the transfer cancellation on July 9.
Kahn has been ordered to appear before Congress next week to answer questions about whether he assisted in facilitating Epstein’s crimes through his oversight of the deceased sex offender’s financial matters, House Oversight Committee member Robert Garcia announced in a January media statement.
Reuters has no evidence indicating Kahn engaged in wrongdoing.
In subsequent communication with Schwab after Epstein’s arrest, an unidentified Epstein associate inquired whether future Southern Trust account transfers would still require two signatures, as additional money would be sent soon, the report shows.
Epstein had been charged with sex trafficking of minors and remained incarcerated, the DOJ announced on July 8.
Schwab informed FinCEN in the July 13 report that it had “concerns with attempted wires for the purpose of real estate, in light of negative media surrounding Jeffrey Epstein” and worries about him potentially being a flight risk before a bail hearing.
“This investigation is the result of an internal referral,” the document shows Schwab stating.
While Epstein’s transaction failed to complete, the Bin Ennakhil palace — meaning “amidst the palms” — in Marrakesh is no longer unoccupied.
“The property has since been sold to another buyer,” Leon informed Reuters.
