Banks, Basel, compliance and governance

Regulatory fines, bans, law suits and court awards

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THIS is a sequel to the article published in this column on 9 April 2026, titled Epstein, Bank of America, JPMorgan and Deutsche (https://www.ft.lk/columns/Epstein-Bank-of-America-JPMorgan-and-Deutsche/4-790649).

I was certainly encouraged by the many messages seeking clarification and guidance on several matters in that article. Let me therefore provide an additional historical legal background, as well as elaborate upon the rationale for court awards, fines and interventions by regulatory institutions, so as to enhance learning outcomes.

Glaring lapses in the administration of justice

As a layman in law, yet having observed the impressive enforcements, prosecutions and awards in the banking and more particularly the capital market sector in the USA over many decades, I was taken aback when I learned that the US Department of Justice (DOJ) and the US Federal Bureau of Investigations (FBI) have been found wanting given the delayed investigations and prosecutorial failures which span decades. Here is a brief overview.

Records now released under the Epstein Files Transparency Act reveal that survivor Maria Farmer reported Epstein's crimes to the FBI in 1996. This was nearly a decade before local Florida police began their investigations

The FBI was subjected to congressional inquiries for failing to adequately investigate the allegations of the 1990's, which apparently included possession and distribution of child sexual abuse material.

Somewhere in 2005-2006 Police in Palm Beach, Florida, investigate Epstein after reports of molestation involving a 14-year-old girl.

In 2008, Federal prosecutors in Florida, led by then-US Attorney Alexander Acosta signed a controversial non-prosecution agreement. This is referred to as the "Sweetheart Deal" which is said to have shut down a Federal sex trafficking investigation.