Jeffrey Epstein invested $30 million in a private-equity fund alongside the husband of California Sen. Dianne Feinstein, demonstrating the extent of the disgraced New York financier’s ties to political movers and shakers, according to public documents reviewed by Business Insider. The initial investments took place two years before allegations that Epstein paid minors for sexual favors became public.
Records show that Epstein and Feinstein’s husband, Richard Blum, were both investors in Second City Capital Partners I, a $100 million fund founded in 2004 by the Samuel Belzberg, the late Canadian businessman who was behind Gibralt Capital Corp. and Belzberg & Co. The fund was directed by Belzberg’s son-in-law Strauss Zelnick, a well-known media investor who was briefly floated last year as a potential CEO of CBS.
The fund had approximately 40 limited partners in total, according to a Securities and Exchange Commission filing. Many of these investors were not disclosed, but since Epstein’s investments made up nearly one-third of the $100 million fund, the two entities associated with him were disclosed in public filings.
A $30 million investment on behalf of the billionaire Leslie Wexner
An SEC disclosure form shows that Second City Capital I received a total of $30 million in 2004 from two entities that share an address with Epstein’s US Virgin Islands headquarters: COUQ Foundation, a nonprofit Epstein uses to fund science-related projects, and an entity called YHS LLC.
Two sources familiar with Second City Capital Partners confirmed to Business Insider that both investments were made by Epstein on behalf of Leslie Wexner, the billionaire founder of the L Brands, who is the only publicly known client of Epstein’s purported services as a money manager to the hyperwealthy.
Tax returns for COUQ Foundation show that the nonprofit first made a $3.8 million investment in Second City Capital Partners I in 2004. By 2008, it was worth $7 million; C.O.U.Q. Foundation transferred its interest in the fund to a nonprofit associated with Wexner that year.
Epstein conducted ‘little to no due diligence’ before investing, according to a source
A source familiar with the fund confirmed that Epstein also invested $20 million on Wexner’s behalf through YHS LLC. The source said that Epstein mostly communicated through his long-time attorney, Darren Indyke, who also invested his own money into the fund, according to the SEC filing. This source also said the C.O.U.Q. Foundation’s total investment was $10 million, more than was disclosed in its tax returns.
Epstein’s investment was noteworthy, the person said, because after being referred to the team at Second City Capital Partners, he did little to no due diligence before forking over the $30 million investment.
In addition to his investment in the fund on Wexner’s behalf, Epstein directly co-invested an additional $20 million of his own money alongside Second City Capital Partners I into a debt warrant instrument in a company called ID Biomedical, the person said.
The size of Blum’s investment more than doubled in three years
Feinstein’s connection to Second City Capital Partners is documented in her voluminous financial disclosure forms from 2004 to 2010. Feinstein’s husband, the financier Richard Blum, is the sole owner of a limited partnership called Blum Family Partners, which in turn invested between $250,001 and $500,000 in Second City Capital Partners I in 2004, according to public filings. By 2008, the investment had grown to somewhere between $501,000 and $1 million, before going back to the lower range in 2009 and 2010.
“Senator Feinstein has no knowledge, ownership or control of any of those holdings,” a spokesman for Feinstein said in a statement. “She has no involvement whatsoever in her husband’s financial and business decisions. The senator’s assets are in a blind trust, which has been the case since her arrival in the Senate. The senator had never had any contact with Mr. Epstein.”
Second City Capital Partners’ parent company Belzberg and Co., and Blum Capital did not respond to requests for comment. A representative for Wexner declined to comment.
Second City Capital Partners I invested in a variety of public and private companies, including energy, mining, real estate, and electronics companies. Epstein’s involvement was first reported by Bloomberg.
According to Feinstein’s financial disclosures, Blum’s investment in the fund persisted for several years after allegations against Epstein became public in 2006. It’s unclear whether Blum was aware that Epstein was an investment partner.
It’s likewise unclear whether Epstein was aware of Blum’s investment in Second City. But the multi-millionaire sex criminal has a long history of using his money to cultivate relationships with powerful political figures. He famously ferried former President Bill Clinton around on his private jet, and became close to former Harvard University president and Treasury Secretary Lawrence Summers around the time he pledged to donate $30 million to Harvard.
The wife of the governor of the US Virgin Islands was an officer in Epstein’s company
Epstein’s penchant for mixing business and politics extended to his adopted home in the US Virgin Islands, according to corporate records obtained by Business Insider. Epstein’s Financial Trust Company, which he formed on the island of St. Thomas in 1998, employed Cecile De Jongh, the wife of former US Virgin Islands Gov. John De Jongh, as a vice president and officer for a decade—including during six of Gov. De Jongh’s eight years in office.
The records show that Cecile De Jongh joined Financial Trust Company as its secretary and a member of its three-person board of directors in 2003. That same year, she identified herself as an “executive” for the Financial Trust Company in a Federal Election Commission filing related to a donation to a local congressional candidate.
In 2005, she was identified as the company’s treasurer in corporate filings, and beginning in 2006 she was listed as a vice president. For several years, the board consisted of Epstein, De Jongh, and Ghislaine Maxwell, the British socialite who has long been accused of (and has denied) luring young girls into Epstein’s human trafficking network.
In 2007, the year after Epstein was first charged in Florida for solicitation of a prostitute, he was replaced on the board by Indyke. Maxwell, who would eventually be named in Epstein’s controversial non-prosecution agreement as a “potential co-conspirator” in his crimes, was replaced by a local accountant.
Epstein returned to the company as president after his release from jail in 2008.
A lawyer representing Epstein did not respond to a request for comment.
Financial disclosures can’t be located
De Jongh remained on the board through 2012, when Epstein established a new company, Southern Financial LLC. Her husband, John De Jongh, was elected governor of the US Virgin Islands in 2006 and served two terms.
During that time, the Financial Trust Company received benefits from the US Virgin Islands Economic Development Commission, according to the commission’s annual reports. After he left office in 2015, De Jongh was arrested and charged with embezzling public funds; the charges, which did not relate to Epstein or the Financial Trust Company, were later dismissed.
Cecile De Jongh has been previously described in public reports as an “ office manager” for Epstein, but her roles as Financial Trust Company’s vice president, secretary, treasurer, and director were not widely known.
Cecile De Jongh did not return a phone call and a text message seeking comment. John De Jongh did not return a message seeking comment sent through his attorney. According to the supervisor of the US Virgin Islands Department of Elections, the financial disclosure forms John De Jongh filed during his time as governor, which may have shed more light on his wife’s role in Financial Trust Company, could not be located.
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