Risk and Extortion CI:

The Epstein Class and the “Deep State”, Part II: Wexner and Meister

It is often speculated, that Jeffrey Epstein became wealthy because of his association with Leslie Wexner. Leslie Wexner granted Epstein power of attorney in 1991, allowing Epstein the ability to manage all of Wexner’s finances. The two had met in the mid-1980s, and Epstein had been managing Wexner’s personal finances before this formal grant — but 1991 is when it became a sweeping legal authority that let Epstein sign documents, buy and sell assets, hire and fire staff, and borrow money in Wexner’s name.

Now that is in itself remarkable. Why would Wexner give Epstein, a man with no college education and someone who left his former employer Bear Stearns in March 1981 after partners said he had committed a “Reg D violation,” and the firm was simultaneously swept into an SEC insider-trading probe tied to the Bronfman family’s attempted takeover of St. Joe Minerals. The Bronfman connection will be explored in a later blog entry.

Most of the available information from this period comes from men who knew Epstein and were subsequently trying to wash their hands of their involvement in his rise to prominence. Wexner himself is one of them, but also Robert Meister, a Jewish-American insurance executive — eventually vice-chairman of Aon, the global insurance brokerage. He was well-connected in New York philanthropic and social circles, though not himself in the Mega Group league of wealth (I will return to this in a later blog). The crucial detail is that he wasn’t a peripheral figure who happened to bump into Wexner at a charity gala; he was deeply embedded in Wexner’s commercial life.

A pattern starts to emerge here: a network of wealthy Jewish-American businessmen, who socialize primarily under the label of “philanthropic events”, involve an apparent “nobody” – a man without a college degree who was fired from a math’s teacher’s job – in their social circles and their financial dealings.  Because the “evidence” primarily comes from autobiographical confessions after Epstein had been exposed as a sexual predator, it is logical that these wealthy and influential men emphasize Epstein’s deceptive charm rather than, say, their personal interests. This also exposes the weakness of investigative journalism. It can only work with “admissible facts” that could stand up in a court of law. Sociology, while also bound to empirical facticity that stands up in a court of law, however has a second strand of analytical work: logic.

If we accept that wealthy businessmen, who are wealthy enough to engage in philanthropy, do not obtain, let alone maintain, their wealth by ignoring their interests in wealth accumulation and preservation as a general principle, then we have to assume that philanthropy serves their interests too. It provides not only opportunities to maintain a benevolent public façade, but also to obtain tax rebates, and last but not least, it provides wonderful opportunities to meet and socialize with people who have similar interests in wealth accumulation and wealth preservation.

On the basis of this logic, Robert Meister meeting Leslie Wexner and sharing information with him and even introducing someone to him, is nothing unusual.  Meister was the handler of the insurance of Wexner’s company, The Limited. One of the peculiar “success stories” of The Limited was – as so many successful retailers started doing – indeed the entire postwar American consumer-class fortune of this generation was built on an offshore labor arbitrage that the philanthropic public face systematically obscures – its use of cheap labour in textile manufacturing by setting up sweat shops in South East Asia (e.g. Bangladesh, Hong Kong and Sri Lanka) in the late 1970s through the acquisition the logistics company Mast Industries. This gave Wexner the necessary capital to build-up Victoria’s Secret and invest heavily in real estate development, especially shopping malls.

What is more unusual is the official story of how Robert Meister met Jeffrey Epstein.  Meister’s story – published by Vanity Fair – is that Epstein approached him on a commercial flight to Palm Beach. Meister “remembered” being impressed with the young banker. In reality, Epstein lived in a one-bedroom apartment and ran a fledgling investment firm. By the time of the flight, Epstein had been out of Bear Stearns for years. He left in 1981; the flight was in 1985 or 1986. So Bear Stearns was a credential Epstein could invoke in conversation, but it wasn’t the channel of introduction. Epstein was running Intercontinental Assets Group out of his apartment, was effectively broke, and was trolling for entry points to the wealthy.

How could someone who runs large insurance policies for large multinational clients be so easily manipulated by a charming conman? The answer might be very simple: he was perhaps not only conned, but also saw in Epstein an opportunity to further his own interests. Vanity Fair reported that during one conversation, Epstein allegedly asked Meister to introduce him to Wexner. Epstein falsely said he had learned that Wexner’s money manager was stealing from him. Epstein, a self-described financial “bounty hunter,” offered to help recover the funds. It was convincing enough that Meister arranged a meeting for Epstein at Wexner’s house in Aspen. Epstein didn’t pitch himself as a money manager. He pitched himself as a fraud-recovery specialist who had a tip about Wexner being defrauded. That is the angle that allegedly got him a meeting. Interestingly, Meister did not bother to check Epstein’s credentials. Vanity Fair did not ask him or chose not to publish it.

Again, this is sociologically speaking the most interesting. Apparently, men who are used to handling vast sums of money either have no conception of the risks they are taking by not deploying any means to do background checks, or – perhaps more plausibly – operate with a different conception of risk-opportunity-flows that they are not willing to offer up in an interview with a journalist.  These differential conceptions might also explain why it might be true why Meister did actually retrospectively regret having introduced Epstein to Wexner. Epstein might have been a social capital risk to Meister. The reason why Meister emphasized having warned Wexner many times and pleased with him to break with Epstein, might have had other motives. Meister and Wexner did not sever their personal or business ties. Meister being the CEO of a major insurance company would of course understand risks professionally very well, which can only mean that more interests were at stake than mere reputational ones of the loss of social capital, for Meister to remain close to Wexner.

Journalists investigating the early Epstein connections often come across men who apparently tried to sever ties with Epstein or tried to convince Wexner to sever ties with Epstein. It is amazing how many men “knew” Epstein was a conman and/or a sexual predator, but how few of those went to the authorities to report him. Apparently, keeping the authorities out of one’s affairs is a normal thing for business-elites even if crimes are committed involving minors or fraud. What remains is that all the accounts by those close to Jeffrey Epstein in the 1980s and 1990s are under suspicion of having been heavily redacted by one overarching interest: the need for exculpation as a means to save face. As many sociologists including Goffman and Garfinkel have demonstrated, saving face is a crucial social skill. What is also clear as the lower down the pecking order, the easier it is to expose exculpation and use it as evidence. Inversely, the higher up the pecking order, the more risky it is to expose exculpation with hard evidence. Litigations regarding defamation are very expensive and most media companies would rather avoid the risks of losing, including the reputational damage that comes with it.

As a final note: The Jewish-American tag is not to be understood as the cause. Just because the Epstein class was orbiting first in primarily Jewish-American circles does not mean that Jewishness is a causal factor. As will become clear, the Epstein class includes a wide range of non-Jewish benefactors and accomplices. It is a simple social fact that most social networks – and especially those that also involve illicit activities – are based on kinship and ethnic ties. It functions as a glue that secures bonds beyond transactional interests. It is logical that Meister might have trusted Epstein more easily because both were Jewish-American; it might also be that Meister believed that Epstein would be of interest to Wexner because he was Jewish-American. Jewish-American identity, fused with Israel-oriented philanthropy and a specific elite social-institutional ecosystem, provided the glue for this particular network, in the same way that village kinship plus southern-Italian Catholicism provided the glue for the Cosa Nostra. The mechanism is general; the specific glue is contingent on history.