How did Epstein make his money?

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0:33Jon Sopel:This is a Global Player original podcast. This Epstein class as a whole, I think, if you look at the way it operates, you start to understand a lot about your life. You start to understand a lot about why your life goes the way it goes, why your kid's education is in the paltry condition it may be in, why your health care is threadbare. You start to realize that you're down there swimming downstream, just trying to make it through. And that upstream, these are the people, these are the decision makers in many cases. These are the powerful elites who shape your life. And you start to see the character, the morality, the ways of thinking, the sense of human disposability that prevails in that Epstein class.

1:18Jon Sopel:That is Anand Giharadas, journalist, author, who has studied the Epstein Files and has tried to work out where the tentacles extend in this powerful group of people who were very wealthy, who were hugely influential and who were somehow bound together with Epstein at the centre. The enduring question always comes back to how Epstein got rich. Was it blackmail? Was it fraud? Was it brilliance? How did he entangle so many others in that web? Welcome to the News Agents.

1:55The News Agents. Well, joining us now, Anand Girdadas, who has written for The New York Times, The New Yorker, and now publishes The Inc., which essentially investigates money, power, politics, culture, who you'll hear speaking about the Epstein class a lot. In fact, he's publishing a series of deep dive articles with that name. Anna, just yesterday, we saw a moment that actually left a lot of people scrabbling for words in the UK, which was the arrest of the former Prince Andrew, Andrew Mountbatten Windsor. He is not the whole story, but he has found himself at the centre of the Epstein story, at least in this country.

2:40Will you just give us your sense of what it tells us? We live in an age of impunity. And yesterday, the arrest of the former Prince Andrew was a good day for justice in that sense, in the sense that I think if you were to walk out of your studio or my home right now and talk to people on the street in London or New York about how they feel in general in this time we live in, they feel like they work hard. things often don't go in their favor and that there's a group of very, very powerful people who can fail as much as they want, who can get us into bogus wars, who can tank our economy, who can traffic women, who can have sex with minors or whatever the case, individual case may be, and get away with it.

3:25And so when we see someone who's not just a powerful person, but once was a prince in your country actually facing justice in a way, by the way, where in my country, the United States, virtually nobody is facing any kind of similar justice despite all these revelations. In a moment like that, it strikes me as quite a good thing. And I will say, if impolitely, that I think one should not simply be satisfied with one former prince being arrested. I think the question of why that prince was allowed to operate that way, whether the royal family and how much they paid on his behalf for silence. I think this is not just a moment about one man.

4:10It's a moment that calls into question why societies maintain the elites they do and in your case, the royal family that you do. Yeah.

4:17Jon Sopel:And it's just worth underlining, Anand, that previously Andrew Mountbatten-Windsor has denied any wrongdoing and so far no charges have been brought against him. So he is under arrest but has not yet been charged. Do you think that Andrew Mountbatten-Windsor, in what you have studied, is exceptional in the sense that he was a member of a royal family? or is it just the rich and powerful, some on the right, some on the left, some from Midwestern towns, some from the coast, whatever. They are all part of the same thing. Yeah, there is an Epstein class that these files have revealed, have unmasked.

5:01And it's worth remembering that, as you say, the class is made up of people of different flavors, right? And so So many of us get distracted by the variety, the diversity. So if you're British, you focus on the British guy. If you're American, you focus on the Americans. If you're on the right, you look at all the leftists who are caught up in it. If you're on the left, you're hunting for evidence of whether Donald Trump was involved. And I understand that kind of inclination, but I think what it distracts us from is seeing the class as a class, seeing this powerful social network as an organism of a kind, a shape-shifting global organism that, though it took different forms, that it had different expressions, was engaged in very similar ways of operating.

5:46And so, you know, part of the reason we're doing this new Epstein class series at the Inc. is we want to expose not just names, of which there are now an abundance in public, but an operating system. How does this work? And how does this have implications for your life? And so what Prince Andrew, the former Prince Andrew, was part of was a group of people who, as I said earlier, can fail as much as they want at whatever they want, can hurt people in certain cases, can simply show a callousness in their economic or business lives, and who suffer no penalties. And so that group, you know, which consists of everything from in its actions, as revealed by these files, from actual sex trafficking and sex to simple information barter, to deal making and global connecting, to article trading.

6:37It's all kinds of activities revealed by these files. But this Epstein class as a whole, I think, if you look at the way it operates, you start to understand a lot about your life. You start to understand a lot about why your life goes the way it goes, why your kid's education is in the paltry condition it may be in, why your health care is threadbare. You start to realize that you're down there swimming downstream just trying to make it through. And that upstream, these are the people, these are the decision makers in many cases. These are the powerful elites who shape your life. And you start to see the character, the morality, the ways of thinking, the sense of human disposability that prevails in that Epstein class.

7:23Do you think that the Epstein class, what you're describing, belongs in its own era? Do you think this is a story of impunity in the 90s, in the 2000s, in 2010? Do you think we are substantially changed now as a result of the financial crisis, as a result of bad wars fought, as a result of more transparency in social media? Do you think we're different? In some ways, yes. I think the biggest difference is that if you read through these Epstein files, They very much belong to the kind of high watermark of globalization. And so there is a kind of world is flat, world is one that feels a little bit out of step within the age of new nationalism that we are in.

8:10But I think it's a mistake to view what we are learning as being about the past. I was criticized the other day by Judd Apatow, the Hollywood writer and director, for saying I was studying an old network. Well, when I read the names of not just Jeffrey Epstein, but Bill Gates, when I read names like Donald Trump, when I read names like folks in the Emirates, in the Middle East, when I read names of companies that are still dominant in the United States and around the world, it doesn't seem to me like an old network. And what it certainly is not old are the moves. This kind of global power elite, whose loyalty is more to its own members than to people down below in the communities they represent, it's very much still with us.

8:56And I think it's worth understanding how it works so that you can understand why your life is going the way it's going. And so that you can choose leaders who are actually not in these networks, not affiliated with these networks. Why, we should keep asking ourselves, why is it that so many of the people who happen to be in positions of influence over our lives happen to have not founded a problem to consort with a convicted sex criminal. Let me just ask you something, because your argument could be like all rich men are bastards. And in a way, it takes the onus off the individuals, doesn't it?

9:36I mean, there was criminality because of specific behavior towards actual women in many circumstances. And I wonder whether you sort of flatten it out by a sort of like billionaires are bad. Anyone who sort of connects to anyone else is bad. It takes it off the individuals themselves is my concern. First of all, I have not said any of those things that you just said. I know you're exaggerating it. Look, I think it's a very important point. And I want to actually defer on this to the survivors of these women who have many of them in books they have written and in public statements they have made.

10:13and press conferences they have made. It has been these women who have often said, do not let this just be a story of a small number of people committing sex crimes. This is a story about a power structure. These survivors have said this again and again. And it's important to remember why they are saying that. They are saying that because if this had just been some pervert in Florida or wherever trying to pick up 15-year-old girls off the street and that was all he had going for him, I don't think he would have had a great run of luck. And I think certainly after he was convicted, he would have had a pretty tough road of it.

10:51I don't think you can understand how he did what he did, Jeffrey Epstein, how he continued to do it, how he rehabilitated himself in society, if you don't understand the power structure. And let me make an analogy that I think is helpful. Let's take a different kind of crime, right? For years, I was a reporter in India for the New York Times. You'd often have situations like in Northern India, You have a problem of so-called honor killings in rural communities where women who stray from what the norm is, have a boyfriend, have a dalliance, are even just suspected because they're seen somewhere in public with a young man they're not married to, are killed, sometimes killed by their own father.

11:32Now, you could make the same argument. Let's just focus on the fathers or family members who kill those girls. No one else is killing the girls. Someone is taking out a knife or a gun and killing the girl. No one else is killing the girls. But you'd have to reckon with the fact that there are large swaths of India where this does not happen at all. And I don't think you can understand why it happens a lot in some places and not in other places without understanding all the people who don't commit murder but make murder possible. Without understanding all the people who look away. All the police inspectors who can't be bothered to come check it out.

12:08All the uncles who don't really like what the dad did, but won't say anything about it either. All the women in those communities who suffered the same patriarchy themselves, but learned to shut up about it once they got to a certain age. In other words, yes, in those cases, there is someone committing a very explicit crime and that is the burning heart of that story. The way pedophilia is the burning heart of this Epstein story. But you don't understand how it happened and you can't stop it from happening again. if you do not understand what I think about as the concentric circles of enablement that make the crime at the burning heart possible.

12:45Jon Sopel:Are you describing something that is a completely new phenomenon? Is it just kind of morphed into something with Epstein that was much bigger? In the sense that, look, there were Masonic lodges. The Masons would look out for each other. If you were a member of that, you were part of a slightly closed society where you would forgive wrongdoing. You wouldn't shop them to the police. You would look out for each other's business interests. you'd help someone out if they were kind of on their uppers and were struggling. And that has gone on for decades, for centuries. I think that's right. There's always been tribes and networks and so forth.

13:18I think what, and in some ways you're right, this is another elite. It's another ruling class. Here's, when I did my deep dive into the files and read through thousands and thousands of these emails. I think what struck me as new is that this is a highly global networked elite in a way that simply would not have been possible in the times you were referring to, right? One couldn't have maintained a correspondence with 20 people in China very easily back in those days. So the people I'm writing about in this network are in many cases, really part of a global 24-7 real-time network, right? Dubai, London, Paris, San Francisco, that is a kind of definitional feature of this network.

14:06And I think about, you know, your former Prime Minister, Theresa May, who said, I think several years ago, almost a decade ago now, you know, if you call yourself a citizen of the world, you're sort of a citizen of nowhere. And, you know, I have my disagreements with Theresa May, but I think that was actually an important statement that captures something about this group of people. This is a global network. These people live in certain places, often in multiple places, but they have no loyalty to the places down below. I suspect most people listening to your show right now feel some specific loyalty to the place where they happen to be sitting right now listening to your show.

14:43That's how most people are. That's how most normal people are. I think if you read through the files, the Epstein release, you encounter a group of people whose loyalty is to other members of their global elite network, not to any places they come from. And I think that actually is a bit of a distinguishing factor. I think past ruling classes, for all their faults, and there were many, probably had some more of a sense that they actually came from a place.

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16:21The News Agents. Anand, you know, whenever you hear global elite, you always think George Soros, it must be him.

16:30Jon Sopel:But what you seem to be describing is not someone of a certain mindset. It's not that you adhere to a certain worldview. It's that you could be from the far left, from the far right, but that you are just powerful and you have got things you can trade within that group that makes you essential. That's what I find surprising about what you're saying. Yeah, and I think that's really important because, again, in a tribal age of the kind we live in, everybody only wants to find the members of this network that violate their ideological priors. That's unfortunately not what the files show. What the files show is far left to far right, atheists and religious leaders, academics, business people, all kinds of people.

17:21And so you have to start asking yourself, if we are down here, regular people fighting it out over left versus right, if we turn on our TV and we're seeing one person on the left, one person on the right duking it out over whatever issue. and yet a lot of the same people, sometimes the same people we actually watch on TV fighting with each other are behind closed doors, hanging out, breaking bread, revealing that all that fighting on TV is kind of just a game and what they're actually doing is helping each other, helping each other stay in power, helping each other have access to information that is not available to the rest of us.

18:02I think it raises a question of whether we in Britain, in the United States, elsewhere, have been tricked into thinking that we are each other's enemies, that we are each other's problem, that your neighbor two doors down who flies a flag you don't like is the great obstacle to your visions of the world. In fact, what these files reveal, and I mean this as a profoundly optimistic point, is that your neighbors are not your biggest problem. Your uncle you no longer speak to over Brexit or Trump is not your biggest problem. Your biggest problem, the people who are most responsible for you not feeling in your life the progress you aspire to, you not feeling confident that your children will have a better future than you did, is a group of people who are all in cahoots with each other, who all behave as though they are on the same team.

18:48And maybe it's time some of us down here in the regular world started acting like we are on the same team. Maybe it's time we started acting with some of the solidarity. There's something we can learn from these elites. Maybe we should have some of the same solidarity as regular people. that they have as stratospheric power elites. Okay, so help us perhaps dig into the origins of all this, because once you've described a global powerful elite, the real question is, where did that money come from? And when we're looking at Epstein, you're trying to work out this kid from Coney Island that was a maths teacher at Dalton that kind of talked his way into a job that he probably shouldn't have got.

19:34how did the money start rolling in to a place where he became the centre of it, where people looked up to him, where people wanted to do things for him? We heard yesterday, I mean, very briefly from Les Wexner, the billionaire businessman from Ohio, who by all accounts was the guy who sort of started him off, gave him his fortune, or maybe he would now say was victim to Epstein. What do you understand and of where the Epstein money came from? There's been a lot of remarkable reporting in the New York Times and elsewhere answering that question. And so, yeah, this is, first of all, a guy who comes out of Coney Island in Brooklyn, which if you think about London, think about like the furthest edge of the edge.

20:22Coney Island is known to most New Yorkers as kind of the in-city amusement park, roller coasters, whatever. This is not the elite. This is not people who are central. These are people who live, you know, within a half an hour drive of Manhattan. But it may take three generations if you really work hard to get from Coney Island to Manhattan, right? We have these places in every major city in the world. That's the place he was from. And by all accounts, came out of that place with a burning desire to not end up in that place, right? Born in Coney Island or raised in Coney Island, but not to die there.

20:59and wanted to be in Manhattan. By the way, very similar story that Donald Trump has, that kind of outer borough on the edge of the city hunger to be accepted by the elites at the core. As you say, Jeffrey Epstein got a job teaching at Dalton, the prestigious private school in the Upper East Side of Manhattan. He was the kind of person, I think he, you know, before he was grooming teenage girls, he was charming and you could say grooming lots of people. He was, by all accounts, convincing various dads at Dalton to offer him jobs. How often do you hear about a teacher at a school being dangled job offers for all the dad's companies?

21:41But this is the kind of guy who was. He takes a job at Bear Stearns, a big financial house. He is both sort of exposed for lying about his education, but he somehow talks his way out of it, saying that he came from a background where if he was honest about his background, he wouldn't have gotten in. And his kind of, you know, working class made good boss was moved enough by that story to tolerate him and keep him. He was dating a senior person's daughter at Bear Stearns. And from there, you know, started to both socially network himself in New York and move into areas of managing money for other people, including eventually Les Wexner.

22:21and for a while it was a question of how did he make all this money and how do you make so much money as a money manager. There now is a lot more suggestion that what he was doing was scamming people from the beginning, that he was mismanaging money, that part of his kind of money management style was to move money from other people's account to his account. But is it right that Wexner gave him power of attorney over all his... That's the reporting I've seen is that, you know, he did. And by the way, I think it's not entirely uncommon when you hire people to manage them. I mean, I have an accountant.

22:54If my accountant wanted to steal my money, I think my accountant probably has ways to do that. So he was able to scam these people. But the remarkable part of the story is, again, most people would probably get caught. He figured out, I think, a lot of social insurance that allowed him to keep going and keep doing it. What I mean by that is I think as an outsider to the heart of the New York City elite, he sort of socially mapped it in a way that maybe is not obvious to people who are just in it. I think of him sometimes as a bit of a foreign correspondent in New York. He was able to see what these different things were doing, what the charity galas are actually doing, how you if you if you go to that club, people will see you in this way.

23:41How if you go to this restaurant, people see you in that way. And he was able to build for himself a sense of his own inevitability in the social elite, even when he was, you know, on the upswing and then was scamming, was stealing, was throwing lavish parties, was creating this sense, this aura around himself that he was a man in the mix, a man in the know. Do you think he ever actually made any money? I mean, do you think he was good at making money or are you imagining now it was just a clever Ponzi scheme? I have no idea. Yeah. I mean, I think he was probably a smart person who I've seen these interviews that he did with Steve Bannon, the Trump strategist and whisperer, where he's talking in detail about different financial instruments and this and that.

24:24I don't know if he made any of that money legitimately. I don't think doing things legitimately seemed particularly important to him. One of the things that we're going to do in this Epstein Class series is actually look at one of the ways that he made money was by going to people who had big fortunes. And he had a move, which we're going to write about in a forthcoming chapter of the Epstein Class series, which is that he would try to convince these older people that their children or other advisors they had were mismanaging their money. And you can see that. I've read through many of the emails where he's sort of planting this seed that your kids are idiots and they're squandering your fortune.

25:07Now, if you think about wealthy people, wealthy people of a certain age who may not be able to dive into all their accounts online, the basic anxiety is that this is all going to return to the mean. That famous quote about the third generation, the first generation builds it, second maintains it, third squanders it. You are living in that terror that your kid's going to be that third generation. Your whole project is to defy that proverb or that saying. And he played perfectly into that anxiety by telling you, your kids are squandering, your kids are messing it all up. let me manage your family office instead for you.

25:52And then it would cost millions of dollars a year in fees and services to do that. And then, you know, presumably it'd also give them access to accounts if you wanted to skim some off the top.