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Date TimeAugust 01, 2019
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Jeffrey Epstein’s Bail Bid Hurt as Court Slams Private Guards for Wealthy
(Bloomberg) -- Wealthy people charged with crimes have no right to be freed from jail and watched at home by private guards, the federal court weighing Jeffrey Epstein’s appeal of his bail request ruled in a separate case.The U.S. Court of Appeals in New York on Thursday refused to overturn a bail ruling that is keeping Jean Boustani, an executive of the Privinvest maritime services companies, behind bars. Boustani had asked to be released to home confinement while awaiting trial for his part in an alleged $2 billion fraud and money-laundering scheme.The appeals court discussed the issue of private armed security guards for wealthy defendants -- a request made by Epstein, who’s charged with trafficking underage girls for sex and is now appealing a lower-court judge’s refusal to release him on bail. The Boustani ruling could doom Epstein’s bid because the judges in his case are likely to apply the same logic.“The Bail Reform Act does not permit a two‐tiered bail system in which defendants of lesser means are detained pending trial while wealthy defendants are released to self‐funded private jails,” Circuit Judge Jose Cabranes wrote for a three-judge panel.Martin Weinberg, a lawyer for Epstein, didn’t immediately return a voicemail seeking comment on the ruling.Read More: Epstein Arrest Leaves Tech Leaders Racing to Distance ThemselvesIn recent years, some wealthy defendants accused of serious crimes have been released to what critics describe as a gilded cage -- home confinement in opulent apartments, watched by private guards they paid for. Among them: Bernard Madoff; Marc Dreier, the New York law firm founder who was charged in a $400 million fraud; and Dominique Strauss-Kahn, the former head of the International Monetary Fund who was accused of sexual assault in state court.Prosecutors later dropped charges against Strauss-Kahn. Madoff and Dreier pleaded guilty and are serving long sentences.That bail practice has been controversial. U.S. District Judge Richard Berman, who denied Epstein’s bail request last month, had earlier ruled against a similar request by Reza Zarrab, a wealthy Iranian-Turkish gold trader who eventually cooperated with prosecutors.The appeals court in its ruling Thursday quoted Berman’s decision in the Zarrab case, in which he said that granting bail to defendants because they can afford to pay armed guards is “unreasonable because it helps to foster inequity and unequal treatment in favor of a very small cohort of criminal defendants who are extremely wealthy.”Read More: Jes Staley’s Ties to Epstein Are Latest Headache at BarclaysIn Epstein’s case, Berman ruled that he poses a “danger to the community.” While noting that Epstein could use his wealth to flee, he also said the financier posed a threat to his alleged victims and potential witnesses. He pointed to “compelling testimony” from two women who said that Epstein had sexually abused them when they were teens and who claimed he continues to be dangerous.“Many judges, like Judge Berman, have been uncomfortable with the appearance of favoritism to wealthy defendants as most people cannot afford such arrangements,” said Harry Sandick, a partner with the law firm Patterson Belknap Webb & Tyler in New York who isn’t involved in the case. “The decision offers little help to Epstein.”In the Boustani case, the court said it may be appropriate to include private guards as a bail condition when the defendant’s wealth is the only justification for finding a risk of flight. But it said the lower court based its decision on additional factors, including the seriousness of the charges, the strength of the evidence against Boustani, his frequent international travel and his ties to countries that don’t provide for extradition to the U.S.Epstein, who may have to wait more than a year for his trial, has been confined since his July 6 arrest in the Metropolitan Correctional Center in lower Manhattan. Last week, he was found injured and unresponsive in his cell, with marks on his neck. Epstein’s lawyers declined to say whether he was assaulted, possibly by another inmate, or whether the injuries were self-inflicted.Epstein is charged with trafficking teenage girls for sex from 2002 to 2005. He pleaded guilty in 2008 to Florida state charges of soliciting prostitution, after striking a non-prosecution agreement with the U.S. He served 13 months in jail and was released for work during the day. Federal prosecutors in New York say they aren’t bound by the deal as they now pursue their own charges.Boustani was arrested in January at New York’s John F. Kennedy International Airport and remains jailed after a federal judge in Brooklyn ruled he’s a flight risk. He is charged in a scheme tied to deals that allowed the East African nation of Mozambique to borrow $2 billion in 2013 for maritime projects and coastline protection.Abu Dhabi-based Privinvest was hired to provide equipment and services for the projects, prosecutors said. Boustani is charged with agreeing to pay $50 million in bribes to Mozambican officials and $12 million to co-conspirators at Privinvest. He has pleaded not guilty.The Epstein case is U.S. v. Epstein, 19-cr-490, U.S. District Court, Southern District of New York (Manhattan).(Updates with details of ruling.)\--With assistance from Patricia Hurtado.To contact the reporters on this story: Bob Van Voris in federal court in Manhattan at rvanvoris@bloomberg.net;Chris Dolmetsch in Federal Court in Manhattan at cdolmetsch@bloomberg.netTo contact the editors responsible for this story: David Glovin at dglovin@bloomberg.net, Peter JeffreyFor more articles like this, please visit us at bloomberg.com©2019 Bloomberg L.P.

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