Epstein Secrets

ee. He delegated management of the back office and day-to-day operations to other senior officers who were experienced in those areas, including Mr. Gruss. The financing sources included cash on the funds' balance sheets; interest and principal received from existing loans; proceeds from sales of asse

exhibits and meeting with front-office professionals to discuss available opportunities. Mr. Zwim met regularly with DBZ's Chief Financial Officer, Perry Gruss, and other members of the treasury group to discuss the financing of potential investments. Mr. Zwim adjusted the size and timing of investments bas

been approved by Schulte in the calls he made to investors. 9 EFTA00613916 Mr. Gruss resigned on the verge of being fired in early October 2006. David Lee was appointed to replace him as DBZ's Acting CFO. Mr. Zwirn informed investors of Mr. Gruss's separation from DBZ in mid-October 2006, using a scri

stigation was apparently completed in mid-September 2006. Thereafter, in early October 2006, the Fund parted ways with its Chief Financial Officer, Perry Gruss. Mr. Zwim, using a script Schulte had approved, immediately called investors (including Mr. Epstein) to inform them of Mr. Gruss's departure (though

ial Officer, Perry Gruss. Mr. Zwim, using a script Schulte had approved, immediately called investors (including Mr. Epstein) to inform them of Mr. Gruss's departure (though he did not tell them the specific nature of the two accounting improprieties). Very shortly thereafter, a third accounting impr

w subscription for an investment was treated as a separate "tranche," with its own cycle of rolling lock-ups. (See Exhibit Q; Exhibit R.) Mr. Zwim, David Lee (former President and acting CFO of the Fund manager) and Elise Hubsher (former head of the Marketing and Investor Relations Group for the Fund man

oney, he will call William Louis Dreyfus to let him know that HB wouldn't be moving forward with DBZ &Co on some energy joint venture? f. As Mr. Gruss said that was "not good"? 8. X-525 also makes clear that at various times the Fund had a liquidity problem? a. X-173 starts with a 11/18/04 emai

incentive fee deferrals was done to provide tax advantages, but left the company without enough cash to pay expenses? (p3) 2) SR concluded that Gruss approved the premature payment of management fees and the use of fund monies to pay your plane expenses? 19 EFTA00624882 Timestamp: 7/212011 5:

interpret your comments? 1) You apologized and offered to send out a redraft? 2) He responds sarcastically that you should have Perry Gruss and David Lee field calls from JE, Bob Rosenkrantz, Michael Sacks, Robert Wood Johnson Foundation etc? 3) Those were "your clients" he says, but you knew that

Daniel Zwim, the Managing Principal of D.B. Zwim. Mr. Zwim informed Mr. Epstein that D.B. Zwirn was terminating the Fund's chief financial officer, Perry Gruss, but stated that there was "nothing wrong" at the Fund. When Mr. Epstein asked for a more detailed explanation, Mr. Zwim indicated that the CFO had

Mr. Zwirn that he wanted to withdraw all of FTC's money from the Fund. 19. In October 2006, D.B. Zwim officially announced the resignation of Mr. Gruss as CFO of the Fund. D.B. Zwim, however, continued to conceal the reasons for Mr. Gruss's departure. In its 2006 Third Quarter Investor Commentary,

6. After FTC submitted its notice of withdrawal, and well before the November 30, 2006 cutoff date, Harry Beller, an FTC representative, spoke with David Lee, D.B. Zwim's new CFO. During that conversation, Mr. Lee informed Mr. Beller that D.B. Zwim would not honor the notice of withdrawal because, accord

126 1 Epstein 2 A. Yes. 3 Q. He lied to you about the airplane? 4 A. He lied that the things that he 5 represented were the reasons that Gruss were fired 11:45:55 6 were strictly immaterial. He said the phrase that 7 it was immaterial was a lie. 8 Q. Anything else you recall him using

to a bunch of unreturned 8 telephone calls, basically saying don't -- don't 9 reach out for Dan Zwirn anymore, speak to somebody 10 else, call David Lee. 02:40:19 11 Q. So you believe that this e-mail was 12 sent because you wanted to talk to Dan and they 13 were trying to deflect you to David