Why agency’s watchdog investigated Jeffrey Epstein

By Kevin Bogardus | 07/10/2020 01:15 PM EDT

Financier and convicted sex offender Jeffrey Epstein came under scrutiny by EPA’s internal watchdog over “possible kickbacks” to environmental regulators in the Caribbean.

EPA's inspector general opened an investigation into allegations that Jeffrey Epstein bribed environmental regulators in the U.S. Virgin Islands.

EPA's inspector general opened an investigation into allegations that Jeffrey Epstein bribed environmental regulators in the U.S. Virgin Islands. Claudine Hellmuth/E&E News(illustration); Palm Beach County Sheriff's Department(Epstein); Navin75 /Wikipedia(St James Island); FOIA(EPA documents)

Jeffrey Epstein came under scrutiny by EPA’s internal watchdog over alleged government corruption in the U.S. Virgin Islands 11 days after his death.

The reason? Information given by a source, whose name was redacted, about "possible kickbacks and other considerations being provided" to environmental regulators in the Caribbean "related to properties owned by the now deceased Jeffrey Epstein," according to a case closing report from EPA’s Office of Inspector General obtained by E&E News under the Freedom of Information Act.

Long suspected of exploiting underage girls, Epstein was charged by federal prosecutors with an elaborate sex trafficking scheme last year. The financier and convicted sex offender who accumulated millions of dollars and hobnobbed with presidents and royalty avoided accountability for violating environmental laws for years as well.


"Epstein allegedly engaged in illegal construction on Great St. James island and used his wealth to pay fines and negotiate settlements that allowed him to avoid harsher penalties for similar environmental violations on Little St. James for nearly 20 years," said the inspector general’s report.

Epstein bought Little St. James in 1998 and then Great St. James in 2016. He flew to his expansive properties there on his private jet, dubbed the "Lolita Express" for the female minors who were among its passengers.

The Washington Field Office in the IG’s investigations branch launched the probe into Epstein’s dealings with government officials regarding those properties.

The agency suspected of being compromised by Epstein was the Department of Planning and Natural Resources, the U.S. Virgin Islands agency meant to protect and preserve the territory’s environment. The investigation by EPA’s IG, however, "did not reveal evidence of public corruption at DPNR."

"No further investigative action is warranted. This investigation is hereby closed," said the report, marked "FOR OFFICIAL USE ONLY," barring its release to "unauthorized persons."

Asked about the report, EPA IG office spokeswoman Tia Elbaum told E&E News, "The OIG does not have any comment."

"DPNR is not surprised that there were no findings of wrongdoing by the EPA OIG investigation," DPNR spokesman Jamal Nielsen told E&E News.

‘Flouting’ environmental laws

Yet EPA itself did come across potential wrongdoing by Epstein — not in corrupting government but in degrading the environment.

Regarding the alleged "illegal construction," EPA’s Caribbean Environmental Protection Division, located in Puerto Rico and overseen by the agency’s Region 2 branch, conducted a joint stormwater inspection with DPNR on Great St. James on Oct. 19 last year, according to the IG’s report.

"Among other findings, the results of the inspection revealed evidence of property development without permit," said the report. EPA then sent a copy of the inspection report to DPNR for "appropriate enforcement action."

EPA Region 2 manages agency operations in New Jersey, New York, Puerto Rico and the U.S. Virgin Islands.

Asked about the "illegal construction" named in the IG report, EPA Region 2 spokesman Elias Rodriguez told E&E News that on July 18 last year, inspectors from EPA and DPNR’s Division of Environmental Protection performed a joint civil inspection on Great St. James.

"The EPA inspection performed included assessing compliance with the federal Clean Water Act (CWA) and the Resource Conservation and Recovery Act (RCRA)," Rodriguez said, adding EPA officially referred its findings of potential CWA and RCRA noncompliance through transmitting its inspection report to DPNR for "consideration of enforcement action" on Oct. 9 last year.

Rodriguez referred further questions to DPNR.

Prosecutors in the Caribbean have shed more light on Epstein’s alleged environmental crimes.

U.S. Virgin Islands Attorney General Denise George filed a lawsuit against Epstein’s estate in January.

The lengthy complaint details how Epstein trafficked, raped and held captive female minors on Little St. James. It also discusses how Epstein evaded DPNR.

The lawsuit notes Epstein’s islands, Great St. James and Little St. James, are "environmentally sensitive locations, with native coral and wildlife protected by federal and territorial law and enforcement authorities."

DPNR repeatedly issued citations and fines against Epstein for violating the U.S. territory’s construction code and environmental laws. Those actions, however, didn’t deter him and an enterprise of affiliated companies.

"Because of Epstein’s enormous wealth, these fines had little effect in curbing or stopping the Epstein Enterprise’s unlawful conduct or conforming its activities to the law," said the complaint.

"The Epstein Enterprise’s violation of the construction and environmental laws was part of a pattern of behavior in flouting the laws of the Virgin Islands and holding itself above the law," the complaint also said. "Rather than participating lawfully in this community, the Epstein Enterprise took advantage of the secluded nature of the islands in furtherance of its crimes."

The lawsuit argues Epstein sought to prevent DPNR from conducting "routine site visits" to inspect unpermitted but possibly damaging construction on Great St. James. In addition, the "Epstein Enterprise" continues to stop or restrict the agency from doing random inspections on Little St. James and Great St. James while the U.S. Virgin Islands will be saddled with "significant expenses" to remove or remediate "the illegal construction," according to the complaint.

Nielsen with DPNR noted that allegations of environmental damages were included in the attorney general’s claims. He said, moving forward, all inquiries should be made to the AG’s office.

"DPNR has no further comments as it relates to Epstein and the case moving against him," Nielsen said.

Asked about EPA’s inspection on Great St. James that found unpermitted construction and Epstein’s other alleged environmental crimes, a U.S. Virgin Islands Department of Justice spokeswoman said the attorney general declined to comment for this story.

Erika Kellerhals, a lawyer for Epstein who received his will, didn’t respond to questions for this story.

At the time the lawsuit was filed against Epstein’s estate, its co-executors released a statement saying, "The Estate is being administered in accordance with the laws of the US Virgin Islands and under the supervision of the Superior Court of the US Virgin Islands," according to press reports.

Since then, George has pushed ahead with her case against Epstein’s estate. In May, her office announced that she had reached agreement with Epstein’s lawyers and his victims’ attorneys for a victims compensation fund.

Epstein was found dead in his Manhattan jail cell on Aug. 10 last year. His death was deemed a suicide.

More revelations may be forthcoming about Epstein’s lurid exploits.

Ghislaine Maxwell, Epstein’s close associate who has been accused of grooming underage girls for him, was arrested last week and remains in custody. The Associated Press reported she is being closely watched and has been given paper clothes to wear so as not to harm herself.