75 message, “That is fine. [The West Palm Beach manager] and I will nail everything down, we just want to get a final blessing.” Negotiations continued throughout the day on Wednesday, September 19, 2007, with Villafaña and Lefkowitz exchanging emails regarding the factual proffer for a plea and the scheduling of a meeting to finalize the plea agreement’s terms. During that exchange, Villafaña made clear to Lefkowitz that the time for negotiating was reaching an end: I hate to have to be firm about this, but we need to wrap this up by Monday. I will not miss my [September 25 charging] date when this has dragged on for several weeks already and then, if things fall apart, be left in a less advantageous position than before the negotiations. I have had an 82-page pros memo and 53-page indictment sitting on the shelf since May to engage in these negotiations. There has to be an ending date, and that date is Monday. Early that afternoon, Lourie—who was participating in the week’s negotiations from his new post at the Department in Washington, D.C.—asked Villafaña to furnish him with the last draft of the plea agreement she had sent to defense counsel, and she provided him with the “18/12 split” draft she had sent to Lefkowitz the prior afternoon. After reviewing that draft, Lourie told Villafaña it was a “[g]ood job” but he questioned certain provisions, including whether the USAO’s agreement to suspend the investigation and hold all legal process in abeyance should be in the plea agreement. Villafaña told Lourie that she had added that paragraph at the “insistence” of the defense, and opined, “I don’t think it hurts us.” Villafaña explained to OPR that she held this view because “Alex and people above me had already made the decision that if the case was resolved we weren’t going to get the computer equipment.” At 3:44 p.m. that afternoon, Lefkowitz emailed a “redline” version of the federal plea agreement showing his new revisions, and noted that he was “also working on a deferred [sic] prosecution agreement because it may well be that we cannot reach agreement here.” The defense redline version required Epstein to plead guilty to a federal information charging two misdemeanor counts of attempt to intentionally harass a person to prevent testimony, the pending state indictment charging solicitation of prostitution, and a state information charging one count of coercing a person to become a prostitute, in violation of Florida Statute § 796.04 (without regard to age). Neither of the proposed state offenses required sexual offender registration. Epstein would serve an 18-month sentence and a concurrent 60 months on probation on the state charges. The redline version again deleted the provisions relating to damages under 18 U.S.C. § 2255 and replaced it with the provision requiring creation of a trust administered by the state court. It retained language proposed by Villafaña, providing that the plea agreement “resolves the federal criminal liability of the defendant and any co-conspirators in the Southern District of Florida growing out of any criminal conduct by those persons known to the [USAO] as of the date of this plea agreement,” but also re-inserted the provision promising not to prosecute Epstein’s assistants and the statement prohibiting the USAO from requesting, initiating, or encouraging immigration proceedings. It also included a provision stating the government’s agreement to forgo a presentence investigation and a promise by the government to suspend the investigation and withdraw all pending legal process.

76 G. Villafaña and Lourie Recommend Ending Negotiations, but Acosta Urges That They “Try to Work It Out” In the late afternoon of Wednesday, September 19, 2007, Villafaña expressed her increasing frustration to her supervisors. She emailed the defense redline version of the plea agreement to Lourie and the incoming West Palm Beach manager, identifying all of the provisions she had “specifically discussed with [the defense team] and rejected, that they have re-inserted into the agreement.” (Emphasis in original). Villafaña opined, “This is NOT good faith negotiations.” Lourie responded that he would “reach out to Alex to discuss.” Lourie immediately emailed Acosta the following: I looked at the latest draft from Jay [Lefkowitz] and I must agree with Marie. Based on my own conversations with him, his draft is out of left field. He claims to orally agree to our terms and then sends us a document that is the opposite. I suggest we simply tell him that his counter offer is rejected and that we intend to move forward with our case. Acosta replied: Why don’t we just call him. Tell him 1. You agree, and then change things. 2. That’s not acceptable, and is in bad faith. Stop it or we’ll indict. 3. Try to work it out. It seems that we are close, and it[’]s worth trying to overcome what has to be painfully . . . annoying negotiating tactics. Acosta explained to OPR that he recognized, [t]his negotiation was a pain, but if it was the right position, the fact that you’ve got annoying counsel on the other side doesn’t it make it less of a right position. You tell them stop being annoying, you try to work it out, and if not, then you indict. In response to Acosta’s instruction, Lourie responded, “Ok will do.” He also forwarded to Acosta the latest version of the USAO draft “hybrid” plea agreement that Villafaña had sent to Lefkowitz the previous day, which Lourie had requested and obtained from Villafaña earlier that afternoon. Meanwhile, Villafaña sent to Lourie and his successor West Palm Beach manager a draft message she proposed to send to Lefkowitz with her objections to the defense revisions, explaining, “I know that you keep saying he is going to plead, and he will plead if we cave on

77 everything, but I really do not think that Mr. Epstein is going to engage in serious negotiations until he sees the Indictment and shows up in mag [federal magistrate judge] court.” She suggested charging Epstein on a federal conspiracy charge, and if he refused to plead to that offense, superseding with additional charges and going to trial. She complained that after seven weeks of negotiations, “we are just spinning our wheels.” Her proposed email to Lefkowitz detailed all of the objectionable provisions in his draft, and concluded, “If you or your client insists on these, there can be no plea agreement.” H. Acosta Edits the Federal Plea Agreement, and Villafaña Sends a Final Version to the Defense The next day, Thursday, September 20, 2007, Villafaña emailed Assistant State Attorney Belohlavek and informed her: Our deadline is Monday evening for a signed agreement and arraignment in the federal system. At this time, things don’t look promising anyway, but I will keep you posted. In their latest draft, they changed what they agreed to plead to in the state from solicitation of minors for prostitution (a registrable offense) to forcing adults into prostitution (a non-registrable offense). We will not budge on this issue, so it is looking unlikely that we will reach a mutually acceptable agreement. If that changes, I will let you know. Acosta sent Lourie “[s]ome thoughts” about the USAO version of the proposed “hybrid” federal plea agreement he had received from Lourie the evening before, commenting that “it seems very straightforward” and “we are not changing our standard charging language” for the defense.120 Noting that the draft was prepared for his signature, Acosta told Lourie that he did not typically sign plea agreements and “this should not be the first,” adding that the USAO “should only go forward if the trial team supports and signs this agreement.”121 Lourie forwarded the email to Villafaña with a transmittal message simply reading, “I think Alex’s changes are all good ones. Please try to incorporate his suggestions, change the signature block to your name and send as final to Jay.” Lourie also noted to Acosta and Villafaña that he believed the defense would want to go back to the initial offer of a state plea with a non-prosecution agreement. When Villafaña sent the revised plea agreement to Lefkowitz later that afternoon, she advised him that if the defense wanted to return to the original offer of a state plea only, the draft NPA she had sent to him on September 17, 2007, would control. 120 The USAO had standard federal plea agreement language, from which this “hybrid” plea agreement had substantially diverged. 121 The standard procedure was for documents such as plea agreements to be signed by an AUSA under the name of the U.S. Attorney. In his OPR interview, Acosta further explained that wanted to give “the trial team” an opportunity to voice any objections because “if it’s something they don’t feel comfortable with we . . . shouldn’t go forward with it.”

78 I. The Defense Rejects the Federal Plea Agreement, Returns to the NPA “State-Only” Resolution, and Begins Opposing the Sexual Offender Registration Requirement After having spent days negotiating the federal charges to be included in a plea agreement, by the afternoon of September 20, 2007, the defense rejected the federal plea option, and the parties resumed negotiations over the details of an NPA calling for Epstein to plead to only state charges. Through multiple emails and attempts (some successful) to speak directly with Acosta and other supervisors, defense attorneys vigorously fought the USAO’s insistence that Epstein plead to a state charge requiring sexual offender registration. After receiving the federal plea agreement, Lefkowitz spoke with Villafaña. She reported to Acosta and Lourie that Lefkowitz told her the defense was “back to doing the state-charges- only agreement” and wanted until the middle of the following week to work out the details, but that she had told defense counsel that “we need a signed agreement by tomorrow [Friday] or we are [filing charges] on Tuesday.” Lefkowitz emailed Villafaña about the draft NPA that she had sent to him, pointing out that it called for a 20-month jail sentence followed by 10 months of community control, rather than 18 months in jail and 12 under community control, and to ask if the USAO had “any flexibility” on the § 2255 procedure. Villafaña responded: The 18 and 12 has already been agreed to by our office, so that is not a problem. On the issue about 18 [U.S.C. §] 2255, we seem to be miles apart. Your most recent version not only had me binding the girls to a trust fund administered by the state court, but also promising that they will give up their [§] 2255 rights. I reviewed the e-mail that I sent you on Sunday with the comments on some of your other changes. In the context of a non-prosecution agreement, the office may be more willing to be specific about not pursuing charges against others. However, as I stated on Sunday, the Office cannot and will not bind Immigration. Also, your timetable will need to move up significantly. As [State Attorney] Barry [Krischer] said in our meeting last week, his office can put together a plea agreement, [and an] information, and get you all before the [state] judge on a change of plea within a day. Villafaña alerted Krischer that evening that negotiations were “not going very well” and that defense counsel “changed their minds again, and they only want to plead to state charges, not concurrent state and federal.” She added, “If we cannot reach . . . an agreement, then I need to [charge] the case on Tuesday [September 25] and I will not budge from that date.” In response to Villafaña’s report of her conversation with Lefkowitz about the defense preference for a “state-charges-only agreement,” Lourie alerted her that, “He wants to get out of [sexual offender] registration which we should not agree to.” Lourie emailed Acosta:

79 I think Jay [Lefkowitz] will try to talk you out of a registrable offense. Regardless of the merits of his argument, in order to get us down in time they made us an offer that included pleading to an offense against a minor (encouraging a minor into prostitution) and touted that we should be happy because it was registrable. For that reason alone, I don’t think we should consider allowing them to come down from their own offer, either on this issue or on time of incarceration. Lefkowitz attempted to reach Acosta that night, but Acosta directed Villafaña to return the call, and told Lourie that he did not want to open “a backchannel” with defense counsel. Lourie instructed Villafaña, “U can tell [J]ay that [A]lex will not agree to a nonregistration offense.” On the morning of Friday, September 21, 2007, Villafaña emailed Acosta informing him that “it looks like we will be [filing charges against] Mr. Epstein on Tuesday,” reporting that the charging package was being reviewed by the West Palm Beach manager, and asking if anyone in the Miami office needed to review it. Villafaña also alerted Lourie that she had spoken that morning to Lefkowitz, who “was waffling” about Epstein pleading to a state charge that required sexual offender registration, and she noted that she would confer with Krischer and Belohlavek “to make sure the defense doesn’t try to do an end run.” That same morning, Epstein attorney Sanchez, who had not been involved in negotiations for several weeks, emailed Sloman, advising, “[I] want to finalize the plea deal and there is only one issue outstanding and [I] do not believe that [A]lex has read all the defense submissions that would assist in his determination on this point . . . [U]pon resolution, we will be prepared to sign as soon as today.” From his out-of-town vacation, Sloman forwarded the email to Acosta, who replied, “Enjo[y] vacation. Working with [M]arie on this.” Sloman also forwarded Sanchez’s email to Lourie and asked, “Do you know what she’s talking about?” Lourie responded that Sanchez “has not been in any negotiations. Don’t even engage with yet another cook.” J. The USAO Agrees Not to Criminally Charge “Potential Co-Conspirators” Lefkowitz, in the meantime, sent Villafaña a revised draft NPA that proposed an 18-month sentence in the county jail, followed by 12 months of community control, and restored the provision for a trust fund for disbursement to an agreed-upon list of individuals “who seek reimbursement by filing suit pursuant to 18 U.S.C. § 2255.” This defense draft retained the provision promising not to criminally charge Epstein’s four female assistants and unnamed employees of the specific Epstein-owned corporate entity, but also extended the provision to “any potential co-conspirators” for any criminal charge arising from the ongoing federal investigation. This language had evolved from similar language that Villafaña had included in the USAO’s earlier proposed draft federal plea agreement.122 Lefkowitz also again included the sentence 122 The language in the USAO’s draft federal plea agreement stated, “This agreement resolves the federal criminal liability of the defendant and any co-conspirators in the Southern District of Florida growing out of any criminal conduct by those persons known to the [USAO] . . . .”

80 precluding the government from requesting, initiating, or recommending immigration proceedings against the two assistants who were foreign nationals. At this point, Lefkowitz again sought to speak to Acosta, who replied by email: “I am happy to talk. My caveat is that in the middle of negotiations, u try to avoid[] undermining my staff by allowing ‘interlocutor[]y’ appeals so to speak so I’d want [M]arie on the call[.] I’ll have her set something up.” Villafaña sent to Lefkowitz her own revised NPA, telling him it was her “attempt at combining our thoughts,” but it had not “been approved by the office yet.” She inserted solicitation of minors to engage in prostitution, a registrable offense, as the charge to which Epstein would plead guilty; proposed a joint recommendation for a 30-month sentence, divided into 18 months in the county jail and 12 months of community control; and amended the § 2255 provision.123 Villafaña’s revision retained the provision suspending the investigation and holding all legal process in abeyance, and she incorporated the non-prosecution provision while slightly altering it to apply to “any potential co-conspirator of Epstein, including” the four named assistants, and deleting mention of the corporate entity employees. Finally, Villafaña deleted mention of immigration proceedings, but advised in her transmittal email that “we have not and don’t plan to ask immigration” proceedings to be initiated.124 Later that day, Villafaña alerted Lourie (who had arrived in Florida from Washington, D.C. early that afternoon) and the new West Palm Beach manager (copying her first-line supervisor and co-counsel) that she had included language that defense counsel had requested “regarding promises not to prosecute other people,” and commented, “I don’t think it hurts us.” There is no documentation that Lourie, the West Palm Beach manager, or anyone else expressed disagreement with Villafaña’s assessment. Rather, within a few minutes, Villafaña re-sent her email, adding that defense counsel was persisting in including an immigration waiver in the agreement, to which Lourie responded, “No way. We don’t put that sort of thing in a plea agreement.” Villafaña replied to Lourie, indicating she would pass that along to defense counsel and adding, “Any other thoughts?” When Lourie gave no further response, Villafaña informed defense counsel that Lourie had rejected the proposed immigration language. OPR questioned the subjects about the USAO’s agreement not to prosecute “any potential co-conspirators.” Lourie did not recall why the USAO agreed to it, but he speculated that he left that provision in the NPA because he believed at the time that it benefited the government in some way. In particular, Lourie conjectured that the promise not to prosecute “any potential co-conspirators” protected victims who had recruited others and thus potentially were co-conspirators in Epstein’s scheme. Lourie also told OPR, “I bet the answer was that we weren’t going to charge” Epstein’s accomplices, because Acosta “didn’t really want to charge Epstein” in 123 Villafaña noted that she had consulted with a USAO employee who was a “former corporate counsel from a hospital” about the § 2255 language, and thought that the revised language “addresses the concern about having an unlimited number of claimed victims, without me trying to bind girls who I do not represent.” 124 Villafaña gave OPR an explanation similar to that given by the case agents—that an ICE Special Agent had been involved in the early stages of the federal investigation of Epstein, and Villafaña believed the agent knew two of Epstein’s female assistants were foreign nationals and would have acted appropriately on that information. Villafaña also said that the USAO generally did not get involved in immigration issues.

81 federal court. Sloman similarly said that he had the impression that the non-prosecution provision was meant to protect named co-conspirators who were also victims, “in a sense,” of Epstein’s conduct. Although later press coverage of the Epstein case focused on Epstein’s connection to prominent figures and suggested that the non-prosecution provision protected these individuals, Sloman told OPR that it never occurred to him that the reference to potential co-conspirators was directed toward any of the high-profile individuals who were at the time or subsequently linked with Epstein.125 Acosta did not recall the provision or any discussions about it. He speculated that if he read the non-prosecution provision, he likely assumed that Villafaña and Lourie had “thought this through” and “addressed it for a reason.” The West Palm Beach manager, who had only limited involvement at this stage, told OPR that the provision was “highly unusual,” and he had “no clue” why the USAO agreed to it. Villafaña told OPR that, apart from the women named in the NPA, the investigation had not developed evidence of “any other potential co-conspirators. So, . . . we wouldn’t be prosecuting anybody else, so why not include it? . . . I just didn’t think that there was anybody that it would cover.” She conceded, however, that she “did not catch the fact that it could be read as broadly as people have since read it.” K. The USAO Rejects Defense Efforts to Eliminate the Sexual Offender Registration Requirement On the afternoon of Friday, September 21, 2007, State Attorney Krischer informed Villafaña that Epstein’s counsel had contacted him and Epstein was ready to agree “to all the terms” of the NPA—except for sexual offender registration. According to Krischer, defense counsel had proposed that registration be deferred, and that Epstein register only if state or federal law enforcement felt, at any point during his service of the sentence, that he needed to do so. Krischer noted that he had “reached out” to Acosta about this proposal but had not heard back from him. Villafaña responded, “I think Alex is calling you now.” Villafaña told OPR that, to her knowledge, Acosta called Krischer to tell him that registration was not a negotiable term.126 Later that afternoon, Villafaña emailed Krischer for information about the amount of “gain time” Epstein would earn in state prison. Villafaña explained in her email that she wanted to include a provision in the NPA specifying that Epstein “will actually be in jail at least a certain number of days to make sure he doesn’t try to ‘convince’ someone with the Florida prison authorities to let him out early.” Krischer responded that under the proposal as it then stood, Epstein would serve 15 months. He also told Villafaña that a plea to a registrable offense would not prevent Epstein from serving his time “at the stockade”—the local minimum security detention facility.127 125 Sloman also pointed out that the NPA was not a “global resolution” and other co-conspirators could have been prosecuted “by any other [U.S. Attorney’s] office in the country.” 126 Krischer told OPR that he did not recall meeting or having interactions with Acosta regarding the Epstein case or any other matter. 127 The State Attorney concluded his email: “Glad we could get this worked out for reasons I won’t put in writing. After this is resolved I would love to buy you a cup at Starbucks and have a conversation.” Villafaña responded, “Sounds great.” When asked about this exchange during her OPR interview, Villafaña said: “Everybody

82 At some point that day, Acosta spoke with Lefkowitz by phone regarding the need for Epstein to plead to a registrable offense. Throughout the weekend, with Villafaña’s Monday deadline looming, defense counsel pressed hard to eliminate the sexual offender requirement. On Saturday, September 22, 2007, Sanchez sent a series of emails to Lourie. In the first, she provided details from a press report about a Florida public official who the previous day had pled guilty to child sex abuse charges and was sentenced to a term of probation. She noted that she “spoke to [M]att [Menchel]” and asked Lourie to call her. Two hours later she sent Lourie a second, lengthy email, strongly objecting to the registration requirement, and outlining “all arguments against registration [as a sexual offender] in this case.” In this email, Sanchez claimed that there had been a “miscommunication” during the September 12, 2007 meeting, and that “we only agreed to the solicitation with minors because we believed and [Krischer] and [Belohlavek] confirmed it was NOT registrable.” Sanchez complained that lifetime sexual offender registration was a “life sentence” that was “uncalled for,” “does not make sense,” and was “inappropriate” to impose “simply [because] the FBI wants it, in return for all there [sic] efforts.” She listed numerous reasons why Epstein should not have to register, including his lack of a prior record or history of sexual offenses; the lack of any danger of recidivism; the ease with which he could be “tracked” without registering; and that it would be “virtually impossible to comply” with four separate state registration requirements. A few minutes later, Sanchez sent Lefcourt’s phone number to Lourie “in case you want to speak to him directly.” In another email sent less than two hours later, Sanchez told Lourie she was writing again because “you are a very fair person. This resolution in the Epstein case is not reasonable. [I]t is a result of a misunderstanding at a meeting.” She stated that Epstein’s attorneys had “consistently emphasized their goal of 18 months in a federal camp” and “[e]veryone knew that a registerable offense precluded” a camp designation. Sanchez added, “Therefore it would have been wholly inconsistent with that primary goal of [Epstein’s] safety to lightly concede to registration at that meeting.” Sanchez concluded, “[I]mposing a life sentence on him is not something anyone will eventually be proud of. Please reconsider and help me get a fair result.” Lourie responded to none of the Sanchez emails, but he did reach out to Acosta for a phone conversation. By email late that night, at 10:26 p.m., Lefkowitz asked Lourie to phone him. The next day, Lefkowitz emailed Acosta—with copies to Sloman, Lourie, and Villafaña— to “follow up on our conversation Friday,” asking Acosta again to reconsider the requirement that Epstein plead to a registrable offense. Lefkowitz wrote that there had been a “misunderstanding” at the September 12, 2007 meeting: Before the meeting, Mr. Krischer and Ms. Belohlavek, a sex prosecutor for 13 years, told us that solicitation of a minor . . . is not a registerable offense. However, as it turned out, [it] is a registerable offense and our discussion at the meeting was based on a mistaken assumption. We suggest that Mr. Epstein enter two pleas—one to the Indictment and a second to a non-registerable charge. has offered to buy me a cup of coffee. I have had coffee with no one.” Krischer told OPR that the “reasons” to which he referred related to the pressure he had been getting from Chief Reiter about the Epstein case.

83 Lefkowitz set forth arguments similar to those Sanchez had presented to Lourie, as to why registration “based on the facts alleged in this case . . . simply does not make sense.” In the event that Acosta did not agree to their proposed charges, Lefkowitz offered as an alternative “to stipulate that the state offense” would “constitute a prior sexual offense for purposes of enhanced recidivist sentencing” should Epstein ever again commit a federal sex offense against minors. As Lefkowitz further argued, “By accepting this option, you would be substituting the certainty of recidivist sentencing for the humiliation of registration.” Emails reflect that, early that afternoon, Acosta, Lourie, and Villafaña discussed the matter in a conference call. Lefkowitz also sent a revised version of the NPA to Villafaña that omitted identification of the charge to which Epstein would plead guilty. Later that day, Lefkowitz emailed Acosta: I got a call from [M]arie who said you had rejected our proposal. Does that mean you are not even prepared to have [Epstein] commit now to plead to the registerable offense near the end of his 18 month sentence and then be sentenced to 12 month[s] community control for that charge? I thought that was exactly what you proposed [F]riday (although you wanted, but were not able, to do it with some kind of federal charge). But that still gives you a registerable sex offense, 30 months total, and 18 in jail. How can that not satisfy you—while still ensuring that [E]pstein is not unduly endangered in jail? Acosta responded, “I do not mean to be difficult, but our negotiations must take place with the AUSAs assigned to the case.” Acosta added that he had spoken with Lourie and Villafaña, and they had “discretion to proceed as they believe just and appropriate.” Acosta copied Villafaña, and she emailed Acosta to thank him “for the support.” L. The Defense Adds a Confidentiality Clause Throughout that Sunday evening, Lefkowitz had numerous email exchanges with Villafaña, and apparently a conference call with Lourie (who was returning to Washington, D.C.) and Villafaña. Later that evening, Lefkowitz sent Villafaña a new version of the NPA that, for the first time, included a confidentiality term: It is the intention of the parties to this Agreement that it not be disseminated or disclosed except pursuant to court order. In the event the Government must disclose this Agreement in response to a request pursuant to the Freedom of Information Act, the Government agrees to provide Epstein notice before the disclosure of this Agreement. After making additional revisions, Villafaña sent this NPA to Acosta and Lourie as the “final” version, asking Acosta to let her know what he thought of it. Among her revisions, she changed the confidentiality provision to the following:

84 The parties anticipate that this agreement will not be made part of any public record. If the United States receives a Freedom of Information Act request or any compulsory process commanding the disclosure of the agreement, it will provide notice to Epstein before making that disclosure.128 VII. SEPTEMBER 24, 2007: ACOSTA MAKES FINAL EDITS, AND THE NPA IS SIGNED The contemporaneous emails show that Villafaña continued to update Acosta as the parties negotiated the final language and that Acosta reviewed and edited the NPA. Shortly after midnight on Monday, September 24, 2007, Acosta sent Villafaña “[s]mall edits” to the “final” NPA she had sent to him. Among his changes was language modifying provisions that appeared to require the State Attorney’s Office or the state court to take specific actions, such as requiring that Epstein enter his guilty plea by a certain date. Acosta explained in his email, “I’m not comfortable with requiring the State Attorney to enter into a [joint sentencing] recommendation” or “requiring a State court to stick with our timeline” for entry of the guilty plea and sentencing. Accordingly, Acosta substituted language that required Epstein alone to make a binding sentencing recommendation to the state court, and required Epstein to use his “best efforts” to enter his guilty plea and be sentenced by the specified dates. Acosta also instructed Villafaña to restore a reference to Epstein’s wish “to reach a global resolution of his state and federal criminal liabilities.” Lourie, who had returned to the Department in Washington, D.C., had a phone conversation with Lefkowitz and sent additional comments on the final draft to Acosta and Villafaña. Villafaña sent a new revision, incorporating edits from Acosta and Lourie, to Lefkowitz later that morning. On the afternoon of September 24, 2007, Villafaña circulated the new “final” version of the NPA to Acosta, Sloman, Lourie, and other supervisors, and asked Lefkowitz to send her the signed agreement. After Lefkowitz electronically transmitted to Villafaña a copy of the NPA signed by Epstein, she emailed her immediate supervisor and her co-counsel: “They have scanned and emailed the signed agreement. It is done.” In his transmittal email, Lefkowitz asked Villafaña to “[p]lease do whatever you can to keep this from becoming public.” Villafaña responded: I have forwarded your message only to Alex, Andy, and [the West Palm Beach manager]. I don’t anticipate it going any further than that. When I receive the originals, I will sign and return one copy to you. The other will be placed in the case file, which will be kept confidential since it also contains identifying information about the girls. When we reach an agreement about the attorney representative for the girls, we can discuss what I can tell him and the girls about the 128 In commenting on OPR’s draft report, Lourie observed that because the NPA contained names of uncharged co-conspirators and other protected information, the USAO would have a duty to redact the information before disclosing the NPA.

85 agreement. I know that Andy promised Chief Reiter an update when a resolution was achieved. . . . [The West Palm Beach manager] is calling, but [he] knows not to tell Chief Reiter about the money issue, just about what crimes Mr. Epstein is pleading guilty to and the amount of time that has been agreed to. [He] also is telling Chief Reiter not to disclose the outcome to anyone. OPR questioned Villafaña about this email. She explained that she generally kept confidential the terms of the resolution of any case. She understood that “the way that the [Epstein] case was resolved” needed to remain confidential, but the victims could be informed about what happened because by the NPA’s terms, they needed to know what the agreement was about. Villafaña emailed the West Palm Beach manager, asking him to tell PBPD Chief Reiter “the good news” but “leave out the part about damages,” and explained that she wanted to meet with the victims herself to explain how the damages provision would work. Villafaña also told him that Lourie had asked that Reiter share information about the NPA only with the PBPD Detective who had led the state investigation of Epstein.129 Villafaña forwarded to Acosta, Lourie, and the West Palm Beach manager Lefkowitz’s email asking that the USAO try to keep the NPA from becoming public. Acosta responded that the agreement “already binds us not to make public except as required by law under [the Freedom of Information Act],” and asked, “[W]hat more does he want?” Villafaña replied, “My guess is that if we tell anyone else (like the police chief or FBI or the girls), that we ask them not to disclose.” Soon thereafter, Acosta emailed Lourie, Villafaña, and the West Palm Beach manager to set up a call to discuss “who we tell and how much,” adding, “Nice job with a difficult negotiation.” The final NPA, as signed by Epstein, his attorneys Lefcourt and Sanchez, and Villafaña, contained the following pertinent provisions: Charges: Epstein would plead guilty to the pending Palm Beach County indictment, plus one count of solicitation of minors to engage in prostitution, a registrable offense. Sentence: The parties would make a joint, binding recommendation for a 30-month sentence divided as follows: consecutive terms of 12 months and 6 months in the county jail, without opportunity for withholding adjudication or sentencing and without community control or probation, followed by 12 months of community control, consecutive.130 Damages: As long as the identified victims proceeded exclusively under 18 U.S.C. § 2255, Epstein would not contest federal court jurisdiction or the victims’ status as victims. The USAO would provide to Epstein a list of individuals 129 The West Palm Beach manager told OPR that he called Chief Reiter, who was “fine” with the outcome. 130 Withholding adjudication or sentencing referred to a special sentence in which the judge orders probation but does not formally convict the defendant of a criminal offense. See Fla. Stat. § 948.01 (2007).

86 it had identified as victims.131 The USAO, with the good faith approval of Epstein’s counsel, would select an attorney representative for the victims, whom Epstein would pay. Timing: Epstein would make his best efforts to enter his guilty plea and be sentenced by October 26, 2007. The USAO had no objection to Epstein self-reporting to begin serving his sentence by January 4, 2008. Immunity: The USAO would not initiate criminal charges against “any potential co-conspirator of Epstein,” including four named personal assistants. Other: Epstein was obligated to undertake discussions with the State Attorney’s Office to ensure compliance with this agreement. Epstein waived his right to appeal. Epstein agreed that he would not be afforded any benefits with respect to gain time or other rights, opportunities, and benefits not available to any other inmate. The federal investigation would be suspended and all pending legal process held in abeyance unless and until Epstein violated any term of the agreement. Evidence “requested by or directly related to” the pending legal process, “including certain computer equipment,” would be kept inviolate until all the NPA terms had been satisfied. Breach: The USAO would be required to notify Epstein of any alleged breach of the agreement within 90 days of the expiration of the term of home confinement, and would be required to initiate prosecution within 60 days thereafter. Disclosure: The parties “anticipate[d]” that the agreement would not be made part of any public record, and if the USAO received a Freedom of Information Act request or compulsory process commanding disclosure of the agreement, it would provide notice to Epstein before making any disclosure.132 That evening, Lefkowitz emailed Lourie to express concern about the notification he understood would be given to Chief Reiter, stating, “I am very concerned about leaks unduly prejudicing Jeffrey [Epstein] in the media.”133 He added, “I have enjoyed working with you on 131 The USAO had not informed the defense of the victims’ identities at this point. The parties anticipated that the USAO would send Epstein’s attorneys a list of victims when Epstein fulfilled his obligation under the NPA to enter his state guilty pleas. 132 The final NPA is attached as Exhibit 3 to this Report. 133 On October 3, 2007, the Miami FBI media officer notified the USAO that the New York Post had reported that federal authorities were not going to pursue federal charges against Epstein. According to the Post, Epstein would plead guilty to soliciting underage prostitutes, “in a deal that will send him to prison for about 18 months,” followed by “a shorter period of house confinement,” and, according to “sources,” federal authorities had “agreed to drop their

87 this matter.” Lourie responded with an assurance that the Reiter notification was only “so he does not find out about it in the paper,” and he concluded: “I enjoyed it as well. Mr. Epstein was fortunate to have such excellent representation.” VIII. POST-NPA NEGOTIATIONS Almost immediately after the NPA was signed, conflicts arose about its terms, and the difficult negotiation process began anew. The USAO quickly realized that there were numerous issues concerning the monetary damages provision that were not resolved in the NPA, and the parties differed in their interpretations of the § 2255 provision, in particular the role and duties of the attorney representative for the victims. As negotiations regarding the damages provision continued, the defense was able to delay having Epstein enter his guilty plea in state court. A. September – October 2007: Sloman’s Concerns about Selection of an Attorney Representative Lead to a Proposed NPA Addendum The first controversy centered on the appointment of an attorney representative for the victims. Initially, Villafaña reached out to a private attorney who was one of several suggested to her for that role. Villafaña notified Lefkowitz that she was recommending the attorney to serve as the victims’ representative and suggested a phone conference to discuss what information the USAO could disclose to the attorney about the case. Villafaña told Lefkowitz that she had never met the attorney, but he had been recommended by “a good friend in our appellate section” and by one of the district judges in Miami.134 Over the next few days, Villafaña exchanged messages with the attorney about the possibility of his serving as the attorney representative. She also exchanged emails with Lefkowitz, passing along procedural questions raised by the attorney. By this time, Lourie had fully transitioned to his detail at the Department’s Criminal Division. Sloman, who had been on vacation during the week the NPA was finalized, returned to the office, reviewed the final agreement, and immediately expressed his disapproval of the provision authorizing the USAO to select an attorney representative for the victims, which he believed might raise the appearance of a conflict of interest. Instead, he proposed that a special master make the selection. Although evidently frustrated by Sloman’s belated proposal, Villafaña conveyed to Lefkowitz the suggestion that a special master be appointed to select the attorney representative, rather than having the USAO make the selection.135 She provided Lefkowitz with probe into possible federal criminal violations in exchange for the guilty plea to the new state charge, with the understanding that he will do prison time.” Dan Mangan, “‘Unhappy Ending’ Plea Deal—Moneyman to Get Jail For Teen Sex Massages,” New York Post, Oct. 1, 2007. ABC News later reported that federal charges “could carry more substantial prison time. Now, Epstein’s high-powered lawyers, including Kenneth Starr, . . . may try to get him out of registering as a sex offender . . . .” Scott Michels, “Money Manager Said to Plan to Plead Guilty to Prostitution Charges: Jeffrey Epstein may serve about 18 months in prison for soliciting prostitutes,” ABC News, Oct. 11, 2007. 134 The “good friend” was an AUSA whom Villafaña was dating. The defense subsequently raised this as a misconduct issue, alleging that Villafaña was “closely associated” with the individual nominated for the victims’ representative position. 135 In a separate email to the proposed attorney representative, Villafaña commented, “[O]f course they tell me this now.”

88 a proposal regarding the special master’s responsibilities, along with a draft letter to send to the special master explaining the procedure for selecting an attorney representative. Lefkowitz objected to this proposal in a letter to Villafaña, pointing out that the NPA did not provide for the appointment of a special master. More importantly, Lefkowitz used the discussion of the special master as an opening to press for other alterations to the language of the NPA or, at least, to its interpretation. Focusing on the attorney representative, Lefkowitz argued that the attorney’s role should be viewed as limited to negotiating settlements and that the attorney was precluded from filing lawsuits on behalf of victims who could not reach a negotiated settlement with Epstein. Lefkowitz proposed: [T]he selected attorney should evaluate the claims of each identified individual, negotiate a total fund amount with Mr. Epstein, then distribute the monies based on the strength of each case. For those identified individuals who elect not to settle with Mr. Epstein, they may proceed on their own, but by doing so, they would not be suing under § 2255 as contemplated by [the NPA] and therefore may not continue to be represented by the selected attorney. Lefkowitz also objected to Villafaña’s draft letter to the special master, asserting that it was essential for the defense to participate in crafting a “mutually acceptable communication” to the victims. Going further, Lefkowitz claimed that any contact between the USAO and the victims about the § 2255 provision would violate the agreement’s confidentiality provision. Lefkowitz admonished the government not to contact the victims “to inform them of the resolution of the case, including [the] appointment of the selected attorney and the settlement process.” Villafaña forwarded Lefkowitz’s letter to Sloman, complaining that the defense interpretation of the § 2255 procedure violated the clear language of the NPA and asking, “Can I please just indict him [Epstein]?” Days later, Sanchez emailed Sloman, and then sent a follow-up letter, asking that Sloman “help resolve” the issue regarding the attorney representative’s role, and arguing that Epstein had never intended by signing the NPA to promise to pay fees for the victims’ civil lawsuits in the event a settlement could not be reached. When Villafaña explained to Sloman her views on Sanchez’s arguments, Sloman responded, “I suggest that you communicate your proposal back to [Sanchez]. The more ‘voices’ they hear the more wedges they try to drive between us.” Villafaña agreed, noting that “[t]here are so many of them over there, I am afraid we are getting triple-teamed.”136 Villafaña sent Sanchez a letter regarding the roles of the special master and attorney representative. The next day, October 10, 2007, Lefkowitz sent a six-page letter to Acosta, as a “follow up to our conversation yesterday,” expressing “serious disagreements” with Villafaña’s view of the process for victims to claim § 2255 damages under the NPA. Lefkowitz reiterated the defense position that the attorney representative’s role was meant to be limited to negotiating settlements for the victims, rather than pursuing litigation. Lefkowitz claimed that a requirement 136 Villafaña also alerted Sloman that a newspaper was reporting that defense counsel was writing a letter to Acosta asking for reconsideration of the requirement that Epstein register as a sexual offender. Villafaña commented, “It appears they don’t understand that a signed contract is binding.”

89 that Epstein pay the victims’ legal fees incurred from contested litigation would “trigger profound ethical problems,” in that the attorney representative would have an incentive to reject settlement offers in order to incur more fees. In addition, Lefkowitz rejected Villafaña’s view that Epstein had waived the right to challenge § 2255 liability as to victims who did not want to settle their claims, and contended that any such victims “will have to prove, among other things, that they are victims under the enumerated statutes.” Finally, Lefkowitz again argued that the USAO should not discuss the settlement process with the victims who were to be identified as eligible for settlement under § 2255: Ms. Villafaña proposes that either she or federal agents will speak with the [victims] regarding the settlement process. We do not think it is the government’s place to be co-counsel to the [victims], nor should the FBI be their personal investigators. Neither federal agents nor anyone from your Office should contact the [victims] to inform them of the resolution of the case, including appointment of the attorney representative and the settlement process. Not only would that violate the confidentiality of the Agreement, but Mr. Epstein also will have no control over what is communicated to the [victims] at this most critical stage. We believe it is essential that we participate in crafting a mutually acceptable communication to the [victims]. We further believe that communications between your Office or your case agents and the [victims] might well violate Rule 6(e)(2)(B) of the Federal Rules of Criminal Procedure. The powers of the federal grand jury should not, even in appearance, be utilized to advance the interests of a party to a civil lawsuit.137 Lefkowitz concluded, “I look forward to resolving these open issues with you during our 4:30 call today.”138 Villafaña was at that time on sick leave, and Sloman and Acosta exchanged emails about crafting an addendum to the NPA to address the method of appointing an attorney representative and to articulate the representative’s duties. The next day, October 11, 2007, Sloman exchanged emails with Lefkowitz about the text of a proposed addendum. B. October 12, 2007: Acosta and Defense Attorney Lefkowitz Meet for Breakfast On the morning after his scheduled afternoon phone call with Lefkowitz, Acosta exchanged emails with Lefkowitz, arranging to meet for breakfast the following day, on October 12, 2007, at a Marriott hotel in West Palm Beach. Contemporaneous records show that Acosta was previously scheduled to be in West Palm Beach for a press event on October 11 and to speak at the Palm Beach County Bench Bar conference the following midday, and that he stayed overnight at the Marriott. 137 Federal Rule of Criminal Procedure 6(e)(2)(B) relates to secrecy of federal grand jury matters. 138 OPR did not locate any emails indicating what happened on the call.

90 However, as with Villafaña’s publicly released emails to Lefkowitz, this meeting between Acosta and Lefkowitz drew criticism when the media learned of it during the CVRA litigation. It was seen either as further evidence of the USAO’s willingness to meet with Epstein’s attorneys while simultaneously ignoring the victims, or as a meeting at which Acosta made secret agreements with the defense. Two letters written later in 2007 refer to the breakfast meeting. In a December 2007 letter to Sanchez, Acosta stated that he had “sua sponte proposed the Addendum to Mr. Lefkowitz at an October meeting in Palm Beach . . . . in an attempt to avoid what I foresaw would likely be a litigious selection process.”139 In an October 23, 2007 letter from Lefkowitz to Acosta, less than two weeks after the breakfast meeting, Lefkowitz represented that during the meeting, Acosta assured me that [the USAO] would not intervene with the State Attorney’s Office regarding this matter; or contact any of the identified individuals, potential witnesses, or potential civil claimants and their respective counsel in this matter; and that neither [the USAO] nor the [FBI] would intervene regarding the sentence Mr. Epstein receives pursuant to a plea with the State, so long as the sentence does not violate state law.140 However, two days after receiving this letter, Acosta revised a response letter drafted by Sloman, adding the term “inaccurate” to describe Lefkowitz’s claims that Acosta had promised not to intervene with the State Attorney’s Office, contact individual witnesses or claimants, or intervene regarding Epstein’s sentence.141 The draft response stated, “[S]uch a promise equates to the imposition of a gag order. Our Office cannot and will not agree to this.”142 Acosta told OPR that he did not remember the breakfast meeting, but he speculated that the meeting may have been prompted by defense complaints that Villafaña had recommended “her boyfriend’s partner” to serve as attorney representative.143 Acosta said that “the way this was reported [in the press] was that I negotiated [the NPA] over breakfast,” which was inaccurate because the NPA had been signed weeks before the breakfast meeting.144 When asked about 139 In fact, Sloman and Lefkowitz had been working on language for the Addendum before Acosta’s breakfast meeting with Lefkowitz. It is possible that Acosta was not aware of Sloman’s efforts or had forgotten about them when writing the December 7, 2007 letter. 140 This letter is discussed further in the following section of this Report. 141 OPR did not find evidence establishing that the response was ever sent. 142 Sloman’s initial draft response referred to a conversation the previous day in which Acosta had “clarified” Lefkowitz’s claims about what Acosta had purportedly said in the October 12, 2007 breakfast meeting. 143 As noted previously, the attorney whom Villafaña recommended was a friend of another AUSA whom Villafaña was then dating, but had no professional relationship with either Villafaña or the other AUSA. 144 For example, the Miami Herald’s November 2018 investigative report stated that “on the morning of the breakfast meeting, a deal was struck—an extraordinary plea agreement that would conceal the full extent of Epstein’s crimes and the number of people involved. . . . [T]he deal—called a non-prosecution agreement—essentially shut down an ongoing FBI probe . . . .” Julie K. Brown, “Perversion of Justice: How a future Trump cabinet member gave a serial sex abuser the deal of a lifetime,” Miami Herald, Nov. 28, 2018. The NPA, however, was finalized and signed

91 Lefkowitz’s description of their breakfast meeting discussion, Acosta told OPR that there were “several instances” in which Lefkowitz and other defense counsel mischaracterized something he or an AUSA said, in a way that was misleading. Emails show that, immediately after the breakfast, Acosta phoned Sloman, who then emailed to Lefkowitz a revision to the Addendum language they had been negotiating and who also later reported to Villafaña that Lefkowitz’s “suggested revision has been rejected.” Other emails show that the parties continued to be at odds about the proposed language for the NPA addendum for several days after the breakfast meeting. C. Acosta Agrees to the Defense Request to Postpone Epstein’s Guilty Plea; the Parties Continue to Negotiate Issues concerning the Attorney Representative and Finally Reach Agreement on the NPA Addendum A week after his breakfast meeting with Acosta, Lefkowitz—citing a scheduling conflict— sent Acosta an email seeking his agreement to postpone Epstein’s entry of his guilty plea in state court from October 26, 2007, the date agreed to in the NPA, to November 20, 2007. In his email, Lefkowitz reported that the State Attorney’s Office had agreed to the postponement, and he noted that Acosta had said during the breakfast meeting that he “didn’t want to dictate a schedule to the state.”145 Acosta solicited input from Sloman, who later that day emailed Lefkowitz and agreed to the postponement. With Lourie having departed from the USAO, Sloman became more involved in negotiating the NPA addendum than he had been in the negotiations leading to the NPA, and he quickly came up against the problem Villafaña and Lourie had faced: the defense attorneys continued to negotiate provisions to which they had seemingly already agreed. Between October 12 and 19, 2007, in a series of email exchanges and phone conversations, Acosta, Sloman, Villafaña, and Lefkowitz continued working on language for the NPA addendum addressing the process for selection of the attorney representative and describing which of the representative’s activities Epstein would be required to reimburse. Although it appeared that progress was being made towards reaching agreement on the terms of an addendum, on October 19, 2007, Lefkowitz emailed Sloman identifying “areas of concern” with a proposal the USAO had made days before. Sloman forwarded this email to Acosta, noting that it “re-ploughs some of what we accomplished this week,” and raised “unnecessary” issues. Sloman reported to Acosta that a victim in New York had filed a civil lawsuit against Epstein, and Villafaña was concerned that “this may be the real reason for the delay in the . . . plea. She thinks that [Epstein] . . . want[s] to knock that lawsuit out before the guilty plea to deter others.” Sloman also alerted Acosta that newspaper reports indicated that Epstein had planted false stories in the press in an attempt to discredit the victims. almost three weeks before the breakfast meeting occurred. OPR discusses the breakfast meeting further in its analysis at Chapter Two, Part Three, Section IV.E.2. 145 Assuming Acosta made the remark Lefkowitz attributed to him, it was consistent with the position Acosta had taken before the NPA was signed. As noted previously, during the NPA negotiations, Acosta had instructed Villafaña to omit language requiring the State Attorney’s Office to take action by a certain date, because he was “not comfortable with requiring the State” to comply with a specific deadline. During his interview, Acosta told OPR that “we as federal prosecutors are not going to walk in and dictate to the state attorney.”

92 On October 22, 2007, Sloman responded to the issues Lefkowitz had raised, rejecting some defense proposals but agreeing to modify certain language in the proposed addendum to “satisfy your concern.”146 Noting that the addendum and a revised letter to the special master were attached, Sloman ended by stating, “[T]his needs to be concluded. Alex and I believe that this is as far as we can go. Therefore, please advise me whether we have a deal no later than COB tomorrow . . . .” Nonetheless, the next day, Lefkowitz sent Acosta a three-page letter reiterating the Epstein team’s disagreements with the USAO’s interpretation of the NPA. Lefkowitz noted, however, that Epstein had “every intention of honoring the terms of [the NPA] in good faith,” and that the defense letter was not intended to be “a rescission or withdrawal from the terms of the [NPA].” Lefkowitz added: I also want to thank you for the commitment you made to me during our October 12 meeting in which you promised genuine finality with regard to this matter, and assured me that your Office would not intervene with the State Attorney’s Office regarding this matter; or contact any of the identified individuals, potential witnesses, or potential civil claimants and their respective counsel in this matter; and that neither your Office nor the [FBI] would intervene regarding the sentence Mr. Epstein receives pursuant to a plea with the State, so long as that sentence does not violate state law. Indeed, so long as Mr. Epstein’s sentence does not explicitly violate the terms of the Agreement, he is entitled to any type of sentence available to him, including but not limited to gain time and work release. Sloman forwarded the letter to Villafaña, commenting, “Wait [until] you see this one.” Villafaña replied: Welcome to my world. I love the way that they want to interpret this agreement. . . . . It also looks like they are planning to ask for and receive a sentence far lower than the one we agreed to. Has anyone talked to Barry [Krischer] about this? Maybe this is the real reason for the delay in entering the guilty plea? We also have to contact the victims to tell [them] about the outcome of the case and to advise them than an attorney will be contacting them regarding possible claims against Mr. Epstein. If we don’t do that, it may be a violation of the Florida Bar Rules for the selected attorney to “cold call” the girls. 146 The defense raised issues concerning the attorney representative, the statutory limit on damages, and inclusion of certain victims.

93 . . . . Why don’t we agree to mutual recission [sic] and indict him? Acosta also weighed in, sending both Villafaña and Sloman an email with a subject line that read “This has to stop,” in which he stated: Just read the letter. 1. We specifically refused to include the provision saying that we would not communicate. If I recall the conference call, we told him we could not agree to a gag order using those words. 2. The purpose of the agreement was not an out of court settlement. Seems that they can’t take no. Let’s talk re how to proceed. I’m not sure we will ever agree on a letter [to the special master about how to select an attorney representative] at this point. Notwithstanding Acosta’s assessment and prediction, after Sloman sent to Lefkowitz a new draft addendum and they spoke by phone, the parties reached agreement on the addendum’s terms.147 On October 25, 2007, Sloman sent a letter to the person whom the USAO had selected to serve as special master, outlining the special master’s duties. A few days later, on October 29, 2007, Epstein and his attorneys Lefcourt and Sanchez signed the NPA addendum.148 Villafaña’s name was printed as the USAO representative, but at Villafaña’s request, Sloman signed the addendum for her on behalf of the USAO. Villafaña later emailed Sloman thanking him for “the advice and the pep talk,” which apparently related to the defense attorneys’ allegation of impropriety concerning her initial selection of the private attorney to assist the victims. Villafaña explained to Sloman: The funny thing is that I had never met (and still haven’t met) or spoken to [the private attorney] before I asked him if he would be willing to take on this case. . . . But as soon as you mentioned the appearance problem, I saw where the problem would arise and agreed that the Special Master would be a safer route. I just worry that the defense’s attacks on me could harm the victims. Sloman responded that defense counsel had “put an . . . insidious spin” on Villafaña’s role in proposing the private attorney, but Sloman added, “I hope that you understand that these ad hominem attacks against you do not diminish in our eyes what you and the agents have accomplished.” 147 Acosta and Villafaña were copied on this email. 148 The Addendum is attached as Exhibit 4 to this Report.

94 D. Epstein Further Delays His Guilty Plea The addendum did not bring the case to conclusion. Instead, the matter entered a new, protracted phase, which involved the upper echelons of the Department of Justice. Despite the fact that Epstein and his attorneys had signed the NPA, they pursued a new strategy of appealing to senior Department managers with the goal of setting aside the NPA entirely. Although ultimately unsuccessful, the strategy delayed the entry of Epstein’s guilty plea by months. On October 29, 2007, Villafaña emailed Sloman, raising several issues that she wanted Sloman to address with Lefkowitz. Among other things, Villafaña pointed out that the NPA required Epstein to use his “best efforts” to comply with the agreement, but he had failed to comply with the timeline established by the NPA when he sought and obtained a plea hearing postponement from October 26 to November 20. Responding to Lefkowitz’s attempts to limit the USAO’s communications with various entities and individuals, Villafaña noted that the USAO needed to be able to communicate with the State Attorney’s Office and the victims’ attorney “to [e]nsure that Epstein is abiding by the terms of the agreement.” That same day, Assistant State Attorney Belohlavek informed Sloman that the state judge assigned to the case had scheduled Epstein’s plea and sentence in early January 2008. Belohlavek assured Sloman that the “plea and sentence will definitely occur before the January 4th date that was agreed on by all for the sentencing.”149 Nonetheless, emails over the course of the next month show that the USAO, the State Attorney’s Office, and defense counsel continued to communicate regarding the date of the guilty plea, with the USAO asserting that a proposed January 7, 2008 date for the entry of Epstein’s guilty plea was “unacceptable,” while the defense contended that Epstein had not agreed to any date. Finally, after multiple communications referring to various potential dates, on December 7, 2007, Epstein attorney Jack Goldberger issued a Notice of Hearing, setting the case for January 4, 2008.150 E. Epstein Seeks Departmental Review of the NPA’s § 2255 Provision Relating to Monetary Damages for the Victims With Epstein’s plea hearing delayed, he launched a new effort to undermine the validity of the NPA, this time within the Department. On November 16, 2007, Epstein attorney Kenneth Starr called the office of Assistant Attorney General for the Criminal Division Alice Fisher and left a message that he was calling regarding Epstein.151 At Fisher’s request, Lourie, who in late September 2007 had begun serving his detail as Fisher’s Principal Deputy and Chief of Staff, returned the call. Fisher told OPR that she had no recollection of this call, and Lourie also could 149 The NPA had required Epstein’s plea and sentencing to occur by October 26, 2007, but provided that Epstein could report to begin serving his sentence on January 4, 2008. 150 State v. Epstein, No. 2006-CF-9454, Notice of Hearing (Fifteenth Judicial Circuit, Dec. 7, 2007). 151 In a meeting with Acosta and Sloman on November 21, 2007, Lefkowitz informed them that Starr had placed a call to Fisher.

95 not recall for OPR the substance of his conversation with Starr, other than that it was likely about Epstein’s wish to have the Department review the case.152 On November 28, 2007, Starr requested, by letter, a meeting with Fisher. In his letter, Starr argued that the USAO improperly had compelled Epstein to agree to pay civil damages under 18 U.S.C. § 2255 as part of a state-based resolution of a criminal case. On the same day, Lefkowitz emailed Sloman, complaining about the USAO’s plan to notify victims about the § 2255 provision and alerting Sloman that Epstein’s counsel were seeking a meeting with the Assistant Attorney General “to address what we believe is the unprecedented nature of the section 2255 component” of the NPA. After Lourie sent to Sloman a copy of the Starr letter, Sloman forwarded it to Villafaña, asking her to prepare a chronology of the plea negotiations and how the § 2255 provision evolved. Villafaña responded that she was “going through all of the ways in which they have tried to breach the agreement to convince you guys to let me indict.” In Washington, D.C., Lourie consulted with CEOS Chief Oosterbaan, asking for his thoughts on defense counsel’s arguments. At the same time, at Lourie’s request, Villafaña sent the NPA and its addendum to Lourie and Oosterbaan. Oosterbaan responded to Lourie that he was “not thrilled” about the NPA; described Epstein’s conduct as unusually “egregious,” particularly because of its serial nature; and observed that the NPA was “pretty advantageous for the defendant and not all that helpful to the victims.” He opined, however, that the Assistant Attorney General would not and should not consider or address the NPA “other than to say that she agrees with it.” During her OPR interview, Fisher did not recall reading Starr’s letter or discussing it with Oosterbaan, but believed the comment about her “agree[ing] with it” referred to a federal prosecution of Epstein, which she believed was appropriate. She told OPR, however, that she “played no role in” the NPA and did not review or approve the agreement either before or after it was signed. As set forth in more detail in Chapter Three of this Report, Villafaña planned to notify the victims about the NPA and its § 2255 provision, as well as about the state plea hearing, and she provided a draft of the notification letter to Lefkowitz for comments. On November 29, 2007, Lefkowitz sent Acosta a letter complaining about the draft notification to the victims. Lefkowitz asked the USAO to refrain from notifying the victims until after defense counsel met with Assistant Attorney General Fisher, which he anticipated would take place the following week. Internal emails indicate that Lourie contacted Oosterbaan about his availability for a meeting with Starr, but both Fisher and Lourie told OPR that such a meeting never took place, and OPR found no evidence that it did. Acosta promptly responded to Lefkowitz by letter, directing him to raise his concerns about victim notification with Villafaña or Sloman. Acosta also addressed Epstein’s evident efforts to stop the NPA from being enforced: 152 In a short email to Fisher, the next day, Lourie reported simply: “He was very nice. Kept me on the phone for [a] half hour talking about [P]epperdine,” referring to the law school where Starr served as Dean.

96 [S]ince the signing of the September 24th agreement, more than two months[] ago, it has become clear that several attorneys on your legal team are dissatisfied with that result. . . . . [You], Professor Dershowitz, former Solicitor [General] Starr, former United States Attorney Lewis, Ms. Sanchez and Messrs. Black, Goldberger and Lefcourt previously had the opportunity to review and raise objections to the terms of the Agreement. The defense team, however, after extensive negotiation, chose to adopt the Agreement. Since then counsel have objected to several steps taken by the U.S. Attorney’s Office to effectuate the terms of the Agreement, in essence presenting collateral challenges to portions of the Agreement. It is not the intention of this Office ever to require a defendant to enter a plea against his wishes. Your client has the right to proceed to trial. If your client is dissatisfied with his Agreement, or believes that it is unlawful or unfair, we stand ready to unwind the Agreement. In a separate, seven-page letter to Starr, with Villafaña’s and Sloman’s input, Acosta responded to the substance of Starr’s November 28 letter to Assistant Attorney General Fisher. Fisher told OPR that she did not recall why Acosta, rather than her office, responded to the letter, but she conjectured that “probably I was trying to make sure that somebody responded since [the Criminal Division wasn’t] going to respond.”153 In his seven-page letter, sent to Starr on December 4, 2007, Acosta wrote: The Non-Prosecution Agreement entered into between this Office and Mr. Epstein responds to Mr. Epstein’s desire to reach a global resolution of his state and federal criminal liability. Under this Agreement, this District has agreed to defer prosecution for enumerated sections of Title 18 in favor of prosecution by the State of Florida, provided . . . Mr. Epstein satisfies three general federal interests: (1) that Mr. Epstein plead guilty to a “registerable” offense; (2) that this plea include a binding recommendation for a sufficient term of imprisonment; and (3) that the Agreement not harm the interests of his victims. Acosta explained in the letter that the USAO’s intent was “to place the identified victims in the same position as they would have been had Mr. Epstein been convicted at trial. No more; no less.” Acosta documented the USAO’s understanding of the operation of the NPA’s § 2255 153 The USAO may have been asked to respond because Starr’s letter raised issues that had not been previously raised with the USAO, and it would normally fall to the USAO to address them in the first instance.

97 provision, recounted the history of NPA negotiations, and described the post-signing efforts by Epstein’s counsel to challenge portions of the NPA. Acosta’s letter concluded: Although it happens rarely, I do not mind this Office’s decision being appealed to Washington, and have previously directed our prosecutors to delay filings in this case to provide defense counsel with the option of appealing our decisions. Indeed, although I am confident in our prosecutors’ evidence and legal analysis, I nonetheless directed them to consult with the subject matter experts in [CEOS] to confirm our interpretation of the law before approving their [charges]. I am thus surprised to read a letter addressed to Department Headquarters that raises issues that either have not been raised with this Office previously or that have been raised, and in fact resolved, in your client’s favor. I am troubled, likewise, by the apparent lack of finality in this Agreement. The AUSAs who have been negotiating with defense counsel have for some time complained to me regarding the tactics used by the defense team. It appears to them that as soon as resolution is reached on one issue, defense counsel finds ways to challenge the resolution collaterally. My response thus far has been that defense counsel is doing its job to vigorously represent the client. That said, there must be closure on this matter. Some in our Office are deeply concerned that defense counsel will continue to mount collateral challenges to provisions of the Agreement, even after Mr. Epstein has entered his guilty plea and thus rendered the agreement difficult, if not impossible, to unwind. . . . . I would reiterate that it is not the intention of this Office ever to force the hand of a defendant to enter into an agreement against his wishes. Your client has the right to proceed to trial. Although time is of the essence . . . I am directing our prosecutors not to issue victim notification letters until this Friday . . . to provide you with time to review these options with your client. . . . We expect a written decision by [December 7, 2007] at 5 p.m., indicating whether the defense team wishes to reaffirm, or to unwind, the Agreement. Acosta explained to OPR that he did not view his letter as “inviting” Departmental review, but he believed the Department had the “right” to address Epstein’s concerns. Moreover, the USAO’s only option at that time was to declare Epstein in breach of the NPA, which would have prompted litigation as to whether Epstein was, in fact, in breach. Acosta noted that defense counsel repeatedly proclaimed Epstein’s intent to abide by the agreement, making any USAO effort to declare him in breach more difficult. In fact, the day after receiving Acosta’s letter, Starr and Lefkowitz responded to Acosta (with copies to Sloman and Assitant Attorney General Fisher) that

98 the defense “[f]irst and foremost” reaffirmed the NPA and that Epstein “has no intention of unwinding the agreement.” On December 7, 2007—the deadline set by Acosta in his December 4, 2007 letter to Starr— the defense transmitted to the USAO a one-sentence “Affirmation” of the NPA and its addendum, signed by Epstein.154 F. Despite Affirming the NPA, Defense Counsel Intensify Their Challenges to It and Accuse Villafaña of Improper Conduct 1. December 7 and 11, 2007: Starr and Lefkowitz Send to Acosta Letters and “Ethics Opinions” Complaining about the Federal Investigation and Villafaña On the same day that the defense team sent Epstein’s “Affirmation” to the USAO, Starr and Lefkowitz sent to Acosta two “independent ethics opinions”—one authored by prominent criminal defense attorney and former U.S. Attorney Joe Whitley, which assessed purported improprieties in the federal investigation of Epstein, and the other, by a prominent retired federal judge and former U.S. Attorney, arguing against the NPA’s use of the civil damages recovery provision under 18 U.S.C. § 2255 “as a proxy for traditional criminal restitution.” Days later, on December 11, 2007, Starr sent a letter to Acosta transmitting two lengthy submissions authored by Lefkowitz presenting substantive challenges to the NPA and to the “background and conduct of the investigation.” These submissions repeated arguments previously raised by the defense but also asserted new issues. In one submission, 20 pages long, Lefkowitz addressed the “improper involvement” of federal authorities in the investigation and criticized Villafaña for a number of alleged improprieties, including having engaged in “unprecedented federal overreaching” by seeking to prosecute Epstein federally, “insist[ing]” that the State Attorney’s Office “charge Mr. Epstein with violations of law and recommend a sentence that are significantly harsher than what the State deemed appropriate,” and requiring that Epstein plead guilty to a registrable offense, a “harsh” condition that was “unwarranted.”155 Lefkowitz also argued that the federal investigation relied upon a state investigation that was “tainted” by the lead PBPD Detective’s misrepresentation of key facts in affidavits and interview summaries, leading the USAO to make its charging decision based on flawed information that “compromised the federal investigation.” Finally, Lefkowitz criticized federal involvement in the state plea process as a violation of “the tenets of the Petite Policy.” In a second, 13-page submission, Lefkowitz reiterated Epstein’s complaints about the § 2255 component of the NPA, arguing, among other things, that federal prosecutors “should not be in the business of helping alleged victims of state crimes secure civil financial settlements.” 154 The Affirmation read: “I, Jeffrey E. Epstein do hereby re-affirm the Non-Prosecution Agreement and Addendum to same dated October 30, 2007.” 155 Villafaña sent Lefkowitz a five-page letter responding to the accusations made against her personally.

99 Notwithstanding these voluminous submissions, Lefkowitz added that Epstein “unconditionally re-asserts his intention to fulfill and not seek to withdraw from or unwind” the NPA. 2. As a Result of the Starr and Lefkowitz Submissions, the New USAO Criminal Chief Begins a Full Review of the Evidence, and Acosta Agrees to Meet Again with Defense Counsel After reviewing Starr’s and Lefkowitz’s letters, Sloman notified Villafaña that “in light of the recent Kirkland & Ellis correspondence” he had asked Robert Senior, who had succeeded Menchel as Chief of the USAO’s Criminal Division, to review de novo the evidence underlying the proposed revised indictment, and Sloman asked Villafaña to provide Senior with all the state and FBI investigative materials. In the meantime, Acosta agreed to meet with Starr and other Epstein defense attorneys to discuss the defense complaints raised in Lefkowitz’s December 11, 2007 submissions.156 The meeting took place in Miami on December 14, 2007. The defense team included Starr, Dershowitz, Lefcourt, and Boston attorney Martin Weinberg. The USAO side included Acosta, Sloman, Villafaña, and another senior AUSA, with the Miami FBI Special Agent in Charge and Assistant Special Agent in Charge also present. In addition to previously raised arguments, during this meeting, Epstein’s attorneys raised a new argument—that the state charge to which Epstein had agreed to plead guilty did not apply to the facts of the case. 3. The Defense Notifies Acosta That It May Pursue a Department Review of the USAO’s Actions Shortly after the December 14, 2007 meeting, Lefkowitz notified Acosta that if the issues raised at the meeting could not be resolved promptly, the defense team may “have no alternative but to seek review in Washington.” Acosta notified Assistant Attorney General Fisher that the defense team might make an appeal to her, and he asked her to grant such a request for review and “to in fact review this case in an expedited manner [in order] to preserve the January 4th plea date.” Starr and Lefkowitz then sent to Acosta a lengthy letter, with numerous previously submitted defense submissions, reviewing issues discussed at the meeting, and advising that Epstein sought a “prompt, independent, expedited review” of the evidence by “you or someone you trust.” The letter reiterated Epstein’s position that his conduct did not amount to a registrable offense under state law or a violation of federal law, and with respect to the NPA’s § 2255 provision, that it was “improper” to require Epstein to pay damages “to individuals who do nothing but simply assert a claim” under the statute. 156 As Assistant Attorney General Fisher’s Chief of Staff, Lourie had informed Starr that Fisher hoped Starr would speak to Acosta to “resolve the[] fairly narrow issues” raised in Starr’s correspondence with Acosta. Acosta had the Starr and Lefkowitz submissions of December 11 forwarded to Fisher.

100 4. Acosta Attempts to Revise the NPA § 2255 Language concerning Monetary Damages, but the Defense Does Not Accept It Acosta undertook to respond to defense counsel’s continuing concern about the § 2255 provision. He sent to Deputy Assistant Attorney General Sigal Mandelker language that he proposed including in a revision to the NPA’s § 2255 implementation section. Mandelker forwarded the language to her counterpart in the Civil Division, who responded to Mandelker and Acosta that he did not have “any insight” to offer. On December 19, 2007, after Acosta and Sloman had a phone conversation with Starr and Lefkowitz, Acosta sent to Sanchez a letter proposing to resolve “our disagreements over interpretation[]” by replacing the existing language of the NPA relating to § 2255 with a provision that would read: Any person, who while a minor, was a victim of a violation of an offense enumerated in Title 18, United States Code, Section 2255, will have the same rights to proceed under Section 2255 as she would have had, if Mr. Epstein [had] been tried federally and convicted of an enumerated offense. For purposes of implementing this paragraph, the United States shall provide Mr. Epstein’s attorneys with a list of individuals whom it was prepared to name . . . as victims of an enumerated offense by Mr. Epstein. Any judicial authority interpreting this provision, including any authority determining which evidentiary burdens if any a plaintiff must meet, shall consider that it is the intent of the parties to place these identified victims in the same position as they would have been had Mr. Epstein been convicted at trial. No more; no less. Acosta also noted that he had resisted his prosecutors’ urging to declare the NPA breached by the defense delays.157 Lefkowitz responded by letter a few days later, suggesting that Acosta’s proposal raised “several troubling questions” and that “the problem arises from the incongruity that exists when attempting to fit a federal civil remedies statute into a criminal plea agreement.”158 In a follow-up letter to Acosta, to address the USAO’s concern that Epstein was intentionally delaying the entry of his guilty plea, Lefkowitz asserted that “any impediment to the resolution at issue is a direct cause of the disagreements between the parties,” and that defense counsel had “at all times made and will continue to make sincere efforts to resolve and finalize issues as expeditiously as possible.” Acosta told OPR that despite this assurance from defense counsel, he was “increasingly frustrated” by Epstein’s desire to take an “11th hour appeal” to the Department so soon before the 157 As described in detail in Chapter Three, Acosta’s December 19, 2007 letter also addressed defense objections to notifying the victims about the NPA and the state plea. 158 After Starr and Lefkowitz had another conversation with Acosta and Sloman, Lefkowitz sent a second letter to Acosta reiterating concerns with the § 2255 provision and asserting that the provision was “inherently flawed and becoming truly unmanageable.” In the end, the defense team rejected Acosta’s December 19, 2007 NPA modification letter.

101 scheduled January 4, 2008 plea hearing. As soon became apparent, Acosta was unable to achieve an expedited review so that Epstein could plead guilty and be sentenced by January 4, 2008, and the plea and sentencing date was rescheduled. On January 2, 2008, Sloman spoke with Assistant State Attorney Belohlavek, who confirmed that the change of plea hearing had been postponed. In an email reporting this to Acosta and Villafaña, Sloman said that Epstein’s local defense attorney Goldberger had told Belohlavek the postponement was because the facts “did not fit the proposed state charge,” and that Belohlavek told Sloman she agreed with that assessment.159 The next day, Villafaña sent to Acosta and Sloman a local newspaper article reporting that Epstein’s state plea hearing was reset for March and in exchange for it the federal authorities would drop their investigation of him. Acosta also sent to Sloman and Villafaña an email memorializing a statement made to him by Lefkowitz in a phone call that day: “‘I [Lefkowitz] may have made a mistake 6 months ago. [Belohlavek] told us solicitation [is] not registrable. It turns out that the actual offense charged is.’”160 5. January 7, 2008: Acosta and Sloman Meet with Sanchez, Who Makes Additional Allegations of USAO Misconduct On January 7, 2008, Acosta and Sloman met with defense attorney Sanchez at her request. According to meeting notes made by Sloman, among other things, Sanchez alleged that the USAO’s media spokesperson had improperly disclosed details of the Epstein case to a national news reporter, and Sanchez “suggested that the USAO could avoid any potential ugliness in DC by agreeing to a watered-down resolution for Epstein.” After Acosta excused himself to attend another meeting and Sloman refused to speak further with Sanchez “without a witness present,” she left. Later that day, Acosta and Sloman spoke by phone with Starr, Lefkowitz, and Sanchez, who expressed concern about the “leak” to the news media, reiterated their objections to the NPA, and pressed for the “watered-down resolution,” which they specified would mean allowing Epstein to plead to a charge of coercion instead of procurement, avoid serving time in jail, and not register as a sexual offender. A note in the margin of Sloman’s handwritten notes of the conversation reads: “We’re back to where we started in September.” That evening, Villafaña expressed concern that the delay in resolving the matter was affecting the USAO’s ability to go forward with a prosecution should Epstein renege on his agreement, and she outlined for Acosta and Sloman the steps she proposed to take while Epstein was pursuing Departmental review. Those steps included re-establishing contact with victims, interviewing victims in New York and one victim who lived in a foreign country, making contact with “potential sources of information” in the Virgin Islands, and re-initiating proceedings to obtain Epstein’s computers. In the meantime, USAO Criminal Division Chief Robert Senior performed a “soup to nuts” review of the Epstein investigation, reviewing the indictment package and all of the evidence Villafaña had compiled. He told OPR that he could not recall the reason for his review, but opined 159 Belohlavek told OPR that she did not recall this incident, but she noted that the PBPD report did set forth facts supporting the charge of procurement of a minor. 160 Although the meeting Lefkowitz had with Lourie, Villafaña, Krischer, and Belohlavek to discuss the state resolution was only four months prior, not six, Lefkowitz’s reference was likely to the September 12, 2007 meeting.

102 that it was to establish whether, if the plea fell apart, he, as Chief, would agree “that we can go forward with” the charges. He did recall being concerned, after completing the review, that “we did not have . . . a lot of victims . . . lined up and ready to testify” and that some victims might “not be favorable for us.” Nevertheless, he concluded that the proposed charges were sound, and he told Acosta that he would approve proceeding with a federal case. 6. Acosta Asks CEOS to Review the Evidence Notwithstanding Senior’s favorable review, Acosta and Sloman told Starr and Lefkowitz that they “appreciate[d]” that the defense wanted a “fresh face” to conduct a review, and noted that the Criminal Chief had not undertaken the “in-depth work associated with the issues raised by the defense.” They told the defense team that Acosta had asked CEOS to “come on board” and that CEOS Chief Oosterbaan would designate an attorney having “a national perspective” to conduct a fresh review in light of the defense submissions. Oosterbaan assigned a CEOS Trial Attorney who Villafaña understood was to review the case and prepare for trial in the event Epstein did not “consummate” the NPA. The CEOS Trial Attorney traveled to Florida to review the case materials, and to meet with Villafaña to discuss the case and interview some of the victims. After one such meeting, Villafaña wrote to Acosta and Sloman: We just finished interviewing three of the girls. I wish you could have been there to see how much this has affected them. One girl broke down sobbing so that we had to stop the interview twice within a 20 minute span. She regained her composure enough to continue a short time, but she said that she was having nightmares about Epstein coming after her and she started to break down again, so we stopped the interview. The second girl . . . told us that she was very upset about the 18 month deal she had read about in the paper. She said that 18 months was nothing and that she had heard that the girls could get restitution, but she would rather not get any money and have Epstein spend a significant time in jail. . . . . These girls deserve so much better than they have received so far, and I hate feeling that there is nothing I can do to help them.161 The CEOS Trial Attorney had substantial experience prosecuting child exploitation cases. She told OPR that in her view, the victim witnesses in this case presented a number of challenges for a prosecution: some of the victims did not want to admit they had sexual contact with Epstein; some had recruited other victims to provide Epstein massages, and thus could have been charged as accomplices; some had “drug histories and . . . things like that”; some could appear to have been “complicit”; and there was no evidence of physical violence against the victims. She did not regard 161 Villafaña added, “We have four more girls coming in tomorrow. Can I persuade you to attend?”

103 these victim issues as insurmountable but, based on these alone, the CEOS Trial Attorney considered a potential prosecution of Epstein to be a “crap shoot.” In addition, she told OPR that there were novel legal issues in the case that also presented difficulties, although she believed these difficulties could be overcome. Shortly after the CEOS Trial Attorney met with the victims, however, “things just stopped” when Oosterbaan instructed her to cease her involvement in the case and CEOS engaged in the Criminal Division review sought by Epstein’s defense team. IX. FEBRUARY – JUNE 2008: THE DEPARTMENT’S REVIEW Epstein’s defense attorneys sought a broad review from the Department, one that would encompass the defense complaints about federal jurisdiction, specific terms in the NPA, and the various allegations of professional misconduct by USAO attorneys and other personnel. The Department, however, only reviewed the issue of federal jurisdiction and never reviewed the NPA or any specific provisions.162 Nonetheless, the process took several months as the defense appealed first to CEOS and the Department’s Criminal Division, and then to the Office of the Deputy Attorney General. The chart set forth on the following page shows the positions and relationships among the individuals in those offices involved in communicating with the USAO or defense beginning in November 2007 or in those offices’ reviews, which continued through June 2008. 162 On February 28, 2008, USAO Criminal Division Chief Senior sent to the Civil Rights Division written notification of the USAO’s “ongoing investigation of a child exploitation matter” involving Epstein and others “that may result in charges of violations of 18 U.S.C. § 1591.” USAM § 8-3.120 required a U.S. Attorney to notify the Civil Rights Division, in writing, “[a]t the outset of a criminal investigation . . . that may implicate federal criminal civil rights statutes, . . . and in no event later than ten days before the commencement of the examination of witnesses before a grand jury.” The provision also required notification to CEOS in cases involving sex trafficking of minors. The written notification was to identify the targets of the investigation, the factual allegations to be investigated, the statutes which may have been violated, the U.S. Attorney’s assessment of the significance of the case, whether the case was of “national interest,” and the U.S. Attorney’s proposed staffing of the matter. Villafaña became aware of this requirement in late February 2008, and she prepared a written notification that was edited by Sloman, who discussed it with Acosta. After briefly summarizing the facts, Senior advised: The Office anticipates charges of violations of Title 18, United States Code, Sections 371, 2422, 2423, and 1591. The investigation of the case by the City of Palm Beach Police Department has resulted in press coverage because of the titillating nature of the facts, but we see this case as similar to other “child prostitution” cases charged by our office, and not a matter of “national interest” as defined by the U.S. Attorney’s Manual. In the notification, Senior stated that CEOS “has been involved and is currently reviewing the matter,” he anticipated the case would be staffed by USAO and Department personnel, and “[i]f we determine that the case should be [charged], a copy [of the charging document] will be forwarded to you.” OPR did not locate a response from the Civil Rights Division to the notification.

Criminal Division *until late Feb. 2008 Alice Fisher Assistant Attorney General Andrew Lourie * Principal Deputy Assistant Attorney General Sigal Mandelker Deputy Assistant Attorney General Andrew Oosterbaan Chief, CEOS Office of the Deputy Attorney General Mark Filip Deputy Attorney General John Roth Senior Associate Deputy Attorney General A. February - May 15, 2008: Review by CEOS and the Criminal Division On Febrnaiy 21, 2008, soon after the CEOS Trial Attorney met with victims, Oosterbaan spoke with Lefkowitz about CEOS's role. fu a subsequent email to Villafana, Sloman, and Senior, Oosterbaan explained: I told [Lefkowitz] that all I want to do is help the process move fo1ward, and if they think we best help the process by taking a fresh and objective look at the case and their arguments [then] that is what I want to do. I told him that if that's what they want - if that is what will help the process to move fo1ward - then I don't think it's advisable for CEOS to partner with the USAO on the case. He wants to think about that (and probably talk to his co-counsel about 104

105 whether it is better to have us partnered in the case or just serve a review function) and he said he’d get back to me later today. Oosterbaan told OPR that this email reflects that he likely told Acosta that he intended to limit CEOS’s role to review only, and Acosta asked him to “make sure the defense is okay with that,” to preempt a possible defense complaint about CEOS’s involvement in the review. Oosterbaan explained to OPR that “the defense ke[pt] bringing up new arguments and new problems and [the USAO was saying] look if we’re going to do this, if you’ve got a problem with it, tell us now.” By February 25, 2008, Lefkowitz told Oosterbaan, who informed Sloman, that the CEOS role should be “review only.” Lourie had just then left the Department to enter private practice, and Oosterbaan continued to keep his direct supervisor, Deputy Assistant Attorney General Mandelker, informed of the defense team contacts. Sloman emailed Lefkowitz that CEOS was “ready to proceed immediately” with a review of the matter. Sloman advised Lefkowitz that “in the event CEOS decides that a federal prosecution should not be undertaken against Mr. Epstein, this Office will close its investigation,” but that, “should CEOS disagree with Mr. Epstein’s position, Mr. Epstein shall have one week to abide by [the NPA].” Sloman forwarded this email to Villafaña, who responded, “Why would we possibly let him keep the same deal after all he has put us through? And after we have discovered 6 new girls . . . .” The defense soon signaled that the CEOS review would not end Epstein’s requests for the Department’s involvement. On February 29, 2008, Lefkowitz requested a defense meeting with Oosterbaan on March 12, 2008.163 Starr spoke to Assistant Attorney General Fisher and “made it clear that [the defense team would] want an audience with her if [CEOS] decid[ed] to support the prosecution.” On March 6, 2008, Acosta alerted Sloman and Oosterbaan that Starr and Lefkowitz had called him to express “concern” about Oosterbaan’s participation in the case, and indicated that “they may ask for more senior involvement.” Acosta “informed them that they certainly had the right to ask whomever they wanted for whatever they thought appropriate, and that whatever process would be given them was up to whomever they asked.” The next day, Lefkowitz followed up with Acosta in an email: We appreciate that you will afford us as much time as Main Justice determines is appropriate for it to conduct a review of this matter. As you have suggested, we will initiate that review process with Drew Oosterbaan, and engage in a discussion with him about all of the facts and circumstances, as well as the legal and policy issues associated with this case. . . . However, due to our misgivings (engendered because Drew has told us that he sees himself as a prosecutor and has already made clear he would be ready and willing to prosecute this case himself[)] we may well find it necessary to 163 The defense team meeting with CEOS was originally to be set for late January, but never got scheduled for that time. On February 25, Sloman informed Lefkowitz that the USAO was “very concerned about additional delays” in the Departmental review process, but would agree to a short extension of the March 3 deadline “to provide CEOS time to engage in a thorough review.”

106 appeal an adverse determination by him within the DOJ. Ken [Starr] and I appreciate that you understand this and have no objection to our seeking appellate review within DOJ. Starr, Lefkowitz, and Martin Weinberg attended the March 12, 2008 meeting, as well as the former Principal Deputy Chief of CEOS, who had joined the Epstein defense team. Oosterbaan, Mandelker, and a current CEOS Deputy Chief represented the Department. The current CEOS Deputy Chief told OPR that it was primarily a “listening session” with Starr doing most of the presentation. Oosterbaan told OPR that he recalled “some back and forth” because the defense team was saying “some outrageous things.” Both Oosterbaan and his Deputy Chief were disturbed that the former CEOS Principal Deputy Chief, who had been an aggressive advocate for child exploitation prosecutions, was supporting the defense position, although according to the CEOS Deputy Chief, the former Principal Deputy Chief gave only a “weak pitch” that was not effective. After the meeting, Starr and Lefkowitz made multiple written submissions to the Criminal Division. One submission provided a lengthy list of USAO actions that “have caused us serious concern,” including the following: “Federal involvement in a state criminal prosecution without any communication with state authorities”;164 the issuance of legal process and document requests for items that “had no connection to the conduct at issue”; the nomination “of an individual closely associated with one of the Assistant United States Attorneys involved in this case” to serve as the victims’ attorney representative; the “insistence” on a victim notification letter inviting the victims to make sworn statements at Epstein’s sentencing; and the purported existence of a “relationship” between Sloman and a law firm representing several of the alleged victims in civil suits against Epstein.165 164 This complaint appeared to be at odds with Villafaña’s understanding that the defense objected to USAO communications with the state authorities. In November 2007, Sloman noted to Lefkowitz, “Your recent correspondence attempting to restrict our Office from communicating with the State Attorney’s Office . . . raises concern.” In a March 2008 email reporting to CEOS about the state case, Villafaña noted that she did not know whether a state “misdemeanor deal [was] back on the table because the defense demanded that we have no contact with the State Attorney’s Office, so I haven’t spoken with the [Assistant State Attorney] in over 6 months.” Villafaña later reported to Acosta and Sloman that when Krischer complained to her that the USAO had not been communicating with him, she explained to Krischer that “it was the defense who were blocking the channels of communication.” 165 In approximately 2001, Sloman briefly left the USAO and for a few months was in private practice with a Miami attorney, whose practice specialized in plaintiffs’ sexual abuse claims. During 2007-2008, the attorney

107 In another letter, Starr renewed the defense accusation that the USAO improperly disclosed information about the case to the media, and accused Sloman and Villafaña of “encouraging civil litigation” against Epstein. Finally, in a letter to Assistant Attorney General Fisher on May 14, 2008, Starr thanked her for having spoken with him the previous day, reiterated the defense team’s various complaints, and asked her to meet with him, Lefkowitz, and Whitley. Meanwhile, Oosterbaan’s Deputy Chief drafted a decision letter to be sent from Oosterbaan to Lefkowitz, and over the course of several weeks, it was reviewed by and received input from Deputy Assistant Attorney General Mandelker and Assistant Attorney General Fisher, as well as the Criminal Division’s Appellate Section (regarding certain legal issues) and Office of Enforcement Operations (regarding the Petite policy). Oosterbaan told OPR that, notwithstanding the defense submissions on a wide variety of issues and complaints, CEOS’s review was limited to determining whether there was a basis for a federal prosecution of Epstein. Oosterbaan’s letter, sent to Lefkowitz on May 15, 2008, notified the defense team that CEOS had completed its independent evaluation of whether prosecution of Epstein for federal criminal violations “would contradict criminal enforcement policy interests.” The letter specified that CEOS’s review addressed the “narrow question” of whether a legitimate basis existed for a federal prosecution, and that CEOS did not conduct a de novo review of the facts, analyze issues relating to federal statutes that did not pertain to child exploitation, or review the terms of the NPA or the prosecutorial misconduct allegations. The letter stated that based on its examination of the material relevant to its limited review of the matter, CEOS had concluded that “federal prosecution in this case would not be improper or inappropriate” and that Acosta “could properly use his discretion to authorize prosecution in this case.” On May 19, 2008, Lefkowitz reached out to Acosta to request a meeting and specifically asked that Acosta “not shunt me off to one of your staff.” Lefkowitz made several points in support of the request for a meeting: (1) CEOS’s letter acknowledged that federal prosecution of Epstein would involve a “novel application” of relevant federal statutes;166 (2) CEOS’s conclusion that federal prosecution would not be “an abuse of discretion” was “hardly an endorsement” of the case;167 (3) CEOS did not address Epstein’s prosecutorial misconduct allegations; and (4) “critical new evidence,” in the form of recent defense counsel depositions of victims confirmed “that represented Epstein victims. The Epstein defense team alleged in the letter that Sloman’s past association with the attorney caused Sloman to take actions to favor victims’ potential civil lawsuits against Epstein. 166 Oosterbaan’s letter stated, “Mr. Acosta can soundly exercise his authority to decide to pursue a prosecution even though it might involve a novel application of a federal statute.” This statement referred to a defense argument based on a prior Departmental expression of concern about a Congressional proposal to expand federal law to “adult prostitution where no force, fraud or coercion was used.” Oosterbaan stated that “the Department’s efforts are properly focused on the commercial sexual exploitation of children”—even if wholly local—and “the exploitation of adults through force, fraud, or coercion.” He then observed that the fact “that a prosecution of Mr. Epstein might not look precisely like the cases that came before it is not dispositive.” 167 Oosterbaan began his letter, however, by making it clear that CEOS had considered “the narrow question as to whether there is a legitimate basis for the U.S. Attorney’s Office to proceed with a federal prosecution of Mr. Epstein.”

108 federal prosecution is not appropriate in this case.”168 Lefkowitz alluded to the possibility of seeking further review of the matter by the Deputy Attorney General or Attorney General, should the defense be unable to “resolve this matter directly with” Acosta. Acosta declined the request to respond personally and directed Lefkowitz to communicate with the “trial team.” That same day, Sloman sent Lefkowitz a letter asking that all further communication about the case be made to Villafaña or her immediate supervisor, and reiterating that Acosta would not respond personally to counsel’s email or calls. Sloman noted that the USAO had “bent over backwards to exhaustively consider and re-consider” Epstein’s objections, but “these objections have finally been exhausted.” Sloman advised that the USAO would terminate the NPA unless Epstein complied with all of its terms by the close of business on June 2, 2008. B. May – June 23, 2008: Review by the Office of the Deputy Attorney General Also on May 19, 2008, Starr and Whitley co-authored a letter to Deputy Attorney General Mark Filip asking for review “of the federal involvement in a quintessentially state matter.”169 In the letter, they acknowledged that CEOS had recently completed “a very limited review” of the Epstein case, but contended that “full review of all the facts is urgently needed at senior levels of the Justice Department.” They argued that federal prosecution of Epstein was “unwarranted,” and that “the irregularity of conduct by prosecutors and the unorthodox terms of the [NPA] are beyond any reasonable interpretation of the scope of a prosecutor’s responsibilities.” They followed up with a second letter on May 27, 2008, in which they asserted “the bedrock need for integrity in the enforcement of federal criminal laws” and “the profound questions raised by the unprecedented extension of federal laws . . . to a prominent public figure who has close ties to President Clinton” required Departmental review. On this latter point, they argued that Epstein “entered the public arena only by virtue of his close personal association with former President Bill Clinton,” and that there was “little doubt” that the USAO “never would have contemplated a prosecution in this case if Mr. Epstein were just another ‘John.’” This was the first defense submission mentioning Epstein’s connection to President Clinton and raising the insinuation that the federal involvement in the investigation was due to politics. In the May 27, 2008 letter to the Deputy Attorney General, Starr and Whitley used the existing June 2, 2008 deadline for the entry of Epstein’s guilty plea to argue that it made the need for review of the case “all the more exigent.” John Roth, a Senior Associate Deputy Attorney General who was handling the matter, instructed the USAO to rescind the deadline, and on May 28, 2008, Sloman notified Lefkowitz that the USAO had postponed the deadline pending completion of the review by the Deputy Attorney General’s office.170 Meanwhile, the Criminal 168 Under Florida Rule of Criminal Procedure 3.220, defendants are permitted to depose victims, and Epstein’s counsel utilized that procedure aggressively and expansively to conduct sworn interviews of multiple victims, including victims who were not part of the state prosecution, to learn information about the federal investigation. 169 In addition to having served as U.S. Attorney in two different districts, Whitley had served as Acting Associate Attorney General, the Department’s third-highest position. 170 On May 28, 2008, Attorney General Mukasey was in Miami for unrelated events and had lunch at the USAO with Acosta and other senior managers. OPR found no indication that the Epstein matter was discussed.

109 Division forwarded to Roth the prior defense submissions, describing them as “an enormous amount of material” regarding the Epstein matter. On June 3, 2008, Sloman sent to Roth a lengthy letter from Sloman to the Deputy Attorney General, recounting in detail the history of negotiations with Epstein’s counsel culminating in the NPA, and addressing Epstein’s claims of professional misconduct. Among the documents submitted with the letter were the prosecution memorandum, one of the proposed charging documents, and the NPA with its addendum and Acosta’s December 19, 2007 letter to Sanchez. As the review was ongoing in the Office of the Deputy Attorney General, State Attorney Krischer mentioned to the USAO’s West Palm Beach manager that Krischer and Epstein’s local defense attorney Jack Goldberger had arrived at a resolution of Epstein’s case that would involve a 90-day jail term, but Krischer provided no further information. Upon learning of this, Villafaña wrote to her immediate supervisor: “Please tell me that you are joking. Maybe we should throw him [Epstein] a party and tell him we are sorry to have bothered him.” Villafaña and her immediate supervisor later had phone and email exchanges with Krischer and with Epstein’s local counsel to insist that the state plea comply with the terms of the NPA, or “we will consider it a breach of the agreement and proceed accordingly.”171 Deputy Attorney General Filip told OPR he had never heard of Epstein before receiving Starr’s letter. Following the office’s standard protocol, Starr’s letter was handled by John Roth, an experienced senior federal prosecutor who had served some years before as an AUSA in the USAO. Roth also told OPR that he had never before heard of Epstein. Roth explained to OPR that he did not conduct an independent investigation, interview witnesses, or meet with Epstein’s counsel, and instead limited his review to written materials submitted by Epstein’s attorneys and by Sloman to the Deputy Attorney General’s office, as well as materials that the defense team and the USAO had previously provided to CEOS and the Criminal Division front office, and that CEOS furnished to him. Roth discussed the matter with two senior staff colleagues, as well as with the Deputy Attorney General, who also reviewed the submissions. Roth told OPR that it was his understanding that Epstein had reneged on the NPA, and because he believed the NPA was a “dead letter,” he did not review the terms of the agreement or ratify it post hoc. On the other hand, Deputy Attorney General Filip told OPR he understood that the NPA was still in effect and that Epstein was trying to undermine the federal jurisdictional basis for the agreement. Apart from addressing Epstein’s federalism arguments, however, Deputy Attorney General Filip did not believe it was the “mission” of the Office of the Deputy Attorney General to review the Epstein case de novo or to examine the NPA’s terms or determine whether the NPA reached the “right balance” between state and federal punishment. He told OPR, “[W]e heard an appeal. . . . [Epstein] wanted a meeting to argue for relief. We didn’t give him a meeting and we didn’t give him [any] relief.” Deputy Attorney General Filip told OPR that no one in his office who looked at Epstein’s arguments “felt that it was a sympathetic appeal.” In particular, he told OPR that defense counsel’s argument that there was no basis for a federal prosecution was “ludicrous,” and the assertion that the USAO’s investigation of Epstein was politically motivated “just seemed unserious.” 171 Villafaña urged Sloman, “Someone really needs to talk to Barry.”

110 On Monday, June 23, 2008, Roth sent a brief letter to Starr and Lefkowitz informing them that the office had “completed a thorough review” of the USAO’s handling of the Epstein matter and did not believe intervention by the Deputy Attorney General was warranted in view of the “considerable discretion” vested by the Department in U.S. Attorneys. He added, “Even if we were to substitute our judgment for that of the U.S. Attorney, we believe that federal prosecution of this case is appropriate.” Immediately after receiving a copy of Roth’s letter, Villafaña notified defense counsel that Epstein would have until close of business on Monday, June 30, 2008, to comply with the NPA by entering his guilty plea, being sentenced, and surrendering to begin serving his sentence. On June 26, 2008, Roth alerted the Office of the Attorney General that Epstein’s counsel might try to contact the Attorney General to request additional review and urged the Attorney General not to take defense counsel’s calls. Roth told OPR that he was concerned that Epstein’s team would try to take a further appeal in order to delay resolution of the case. Meanwhile, Starr sent a concluding email to Acosta, acknowledging they had reached “the end of a long and arduous road” and adding, “While I am obviously very unhappy at what I believe is the government’s treatment of my client, a man whom I have come to deeply admire, I recognize that we have filed and argued our ‘appellate motions’ and lost. . . . I would like to have . . . some closure with you on this matter so that in the years to come, neither of us will harbor any ill will over the matter.” X. JUNE 2008 – JUNE 2009: EPSTEIN ENTERS HIS PLEAS AND SERVES HIS CUSTODIAL SENTENCE On Friday, June 27, 2008, Villafaña renewed her requests to Epstein’s local attorneys Goldberger and Black for a copy of the state plea agreement reached with the State Attorney’s Office, noting that their failure to provide it was a material breach of the NPA. After receiving and reviewing the plea agreement form, which was not yet signed, Villafaña sent another letter to Goldberger and Black, informing them that the proposed sentencing provision did not comply with the requirements of the NPA. Specifically, as written, the plea agreement called for a sentence of 12 months in “the Palm Beach County Detention Facility,” followed consecutively by “18 months Community Control” with a special condition that the defendant serve “the first 6 months [of community control] in the Palm Beach County Detention Facility.” Villafaña objected to the community control provision, reminding Goldberger and Black that the NPA required Epstein to “make a binding recommendation of eighteen months imprisonment, which means confinement twenty-four hours a day at the County Jail.” In a subsequent email to Sloman, Villafaña recounted that she had spoken about the issue with Goldberger, who “‘swore’ that Epstein would be in custody 24-hours-a-day during the community confinement portion of his sentence.” Villafaña added that Goldberger “let it slip that Epstein would not be at the jail, he would be at the stockade . . . . Since we specifically discussed this at the meeting with [the State Attorney] months ago that Epstein would be at [the jail], this certainly violates the spirit of the [NPA] agreement.”172 Villafaña told Sloman, “[S]omething smells very bad.” 172 The Main Detention Center for Palm Beach County is a facility housing maximum, medium, and minimum custody adult males, as well as juvenile and special population male and female inmates. See

111 The next day, Villafaña asked Goldberger to change the plea agreement by inserting the word “imprisoned” after “6 months,” and Goldberger agreed to do so. Villafaña, however, did not ask that the agreement be amended to clarify that the reference to “the Palm Beach County Detention Facility” meant the jail, rather than the Stockade. The final signed plea agreement form further clarified the sentence, providing that after serving 12 months in the Palm Beach County Detention Facility, Epstein would be “sentenced to 6 months in the Palm Beach County Detention Facility . . . to be served consecutive to the 12 month sentence,” followed by “12 months Community Control.” The word “imprisoned” was hand written after “6 months” but then crossed out and replaced by “jail sentence.”173 A. June 30, 2008: Epstein Enters His Guilty Pleas in State Court Epstein, with his attorney Jack Goldberger, appeared in Palm Beach County court on June 30, 2008, and entered guilty pleas to the indictment charging him with one felony count of solicitation of prostitution and to a criminal information charging him with one felony count of procurement of a minor to engage in prostitution.174 At the plea hearing, which Villafaña and the FBI case agent attended as spectators, Assistant State Attorney Belohlavek did not proffer the facts of the case; instead she only recited the charging language in the indictment and the criminal information: [B]etween August 1, 2004 and October 31, 2005, the defendant in Palm Beach County did solicit or procure someone to commit [prostitution] on three or more occasions. And . . . between August 1, 2004 and October 9, 2005, the defendant did procure a minor under the age of 18 to commit prostitution in Palm Beach County also.175 The court found this to be “a sufficient factual basis to support the pleas,” and engaged in a colloquy with Belohlavek regarding Epstein’s victims: The Court: Are there more than one victim? Ms. Belohlavek: There’s several. . . . . http://www.pbso.org/inside-pbso/corrections/general/. The “Stockade” was a “lower security ‘camp-style’ facility” co-located with the Palm Beach County Sheriff’s Office. Both were administered by the Sheriff’s Office. 173 Plea in the Circuit Court, signed June 30, 2008, and filed in court. Villafaña complained to Goldberger when she learned later about the change from “imprisoned” to “jail sentence.” 174 The Information is attached as Exhibit 5. 175 State v. Epstein, case nos. 06-CF-9454 and 08-CF-9381, Transcript of Plea Conference at 41-42 (Fifteenth Judicial Circuit, June 30, 2008) (Plea Hearing Transcript). Belohlavek told OPR that reciting the statutory language of the charge as the factual basis for the plea was the typical practice for a state court plea.

112 The Court: Are all the victims in both these cases in agreement with the terms of the plea? Ms. Belohlavek: I have spoken to several myself and I have spoken to counsel, through counsel as to the other victim, and I believe, yes. The Court: And with regard to the victims under age eighteen, is that victim’s parents or guardian in agreement with the plea? Ms. Belohlavek: That victim is not under age 18 any more and that’s why we spoke with her counsel. The Court: And she is in agreement with the plea? Ms. Belohlavek: Yes.176 When the court asked if the plea was “in any way tied to any promises or representations by any civil attorneys or other jurisdictions,” Goldberger and Belohlavek, with Epstein present, spoke with the judge at sidebar and disclosed the existence of the “confidential” non-prosecution agreement with the USAO, and the court ordered that a copy of it be filed under seal with the court. After the court accepted Epstein’s guilty pleas, and imposed sentence on him pursuant to the plea agreement, Epstein was taken into custody to begin serving his sentence immediately. In the aftermath of the plea, numerous individuals familiar with the investigation expressed positive reactions to the outcome, and Villafaña received several congratulatory messages. Oosterbaan wrote, “Congratulations, Marie—at long last! Your work on this matter was truly exceptional, and you obtained a very significant result that will serve the victims well.” One senior colleague who was familiar with the case noted, “This case only resolved with the filthy rich bad guy going to jail because of your dedication and determination.” Another wrote, “If it had not been for you, he would have gotten away with it.” The CEOS Trial Attorney who had worked briefly with Villafaña told her, “But for your tenacity, he’d be somewhere ruining another child’s life.” One victim’s attorney stated, “[G]reat job of not letting this guy off.” But Villafaña was not satisfied with the outcome, responding to one colleague, “After all the hell they put me through, I don’t feel like celebrating 18 months. He should be spending 18 years in jail.” Acosta later publicly stated that the FBI Special Agent in Charge called him “to offer congratulations” and “to praise our prosecutors for holding firm against the likes of Messrs. Black, 176 Plea Hearing Transcript at 20, 42. OPR was unable to determine to which victims Belohlavek was referring, and Belohlovek did not recall during her OPR interview, but it is possible that she was referring only to the victims of the charged crimes rather than to all of the victims identified in either the state or federal investigations. Belohlavek told OPR that because of the nature of the charges (that is, involving prostitution), she did not know whether “technically under the law” the girls were “victims” whom she was required to notify of the plea hearing.

113 Dershowitz, Lefkowitz and Starr.”177 In that same later public statement, Acosta noted that he received communications from Dershowitz, Starr, and Lefkowitz, who “all sought to make peace” with him; Acosta referred to it as “a proud moment.” On July 7, 2008, an Epstein victim filed an emergency petition against the Department, in federal court in Miami, alleging violation of her rights under the CVRA; a second victim joined the petition soon thereafter. The history of the litigation and issues relating to it are discussed in Chapter Three of this Report. B. Epstein Is Placed on Work Release A few days after Epstein’s guilty plea, Villafaña reported to Sloman that Epstein was incarcerated at the low-security Stockade, rather than the Main Detention Center where county prisoners were usually housed. She also told Sloman that according to the Sheriff’s Office, Epstein was eligible for work release. Although the USAO had made clear that it expected Epstein to be incarcerated 24 hours a day, every day, the subject of work release had not been addressed explicitly during the NPA negotiations, and the NPA itself was silent on the issue. Epstein’s acceptance into the work release program as a convicted sexual offender was seen by many as another special benefit given to Epstein. Because the decision to allow Epstein into the work release program was made by the Palm Beach Sheriff’s Office, OPR did not investigate whether any state, county, or Sheriff’s Office rules were violated. OPR did examine the USAO’s consideration of work release prior to signing the NPA and its subsequent unsuccessful efforts to ensure that Epstein remained incarcerated 24 hours a day. The first specific reference to work release was made weeks after the NPA was signed, when Lefkowitz asserted, in his October 23, 2007 letter to Acosta, that, “so long as Mr. Epstein’s sentence does not explicitly violate the terms of the [NPA] he is entitled to any type of sentence available to him, including but not limited to gain time and work release.” In November 2007, Sloman had an exchange of letters with Lefkowitz about the USAO’s understanding that Epstein had agreed to serve his full jail term in “continuous confinement,” pointing out that the NPA “clearly indicates that Mr. Epstein is to be incarcerated.” Sloman noted that Florida’s Department of Corrections’s rules did not allow individuals registered as sexual offenders to participate in work release, and thus Epstein would not be eligible for a work release program. Sloman concluded that the USAO “is putting you on notice that it intends to make certain that Mr. Epstein is ‘treated no better and no worse than anyone else’ convicted of the same offense,” and that if Epstein were to be granted work release, the USAO would “investigate the reasons why an exception was granted in Mr. Epstein’s case.”178 However, also in November, State Attorney Krischer told Sloman that Epstein was, in fact, eligible to petition for work release because his sexual offender registration would not take place 177 Letter from R. Alexander Acosta “To whom it may concern” (Mar. 20, 2011), published online in The Daily Beast. The FBI Special Agent in Charge told OPR that he had no recollection of such a call, but acknowledged that it could have occurred. 178 Sloman provided a draft of this letter to Acosta for his approval before the letter was sent to Lefkowitz.

114 until after Epstein completed his sentence, but that Krischer would oppose such a petition “if it is in the agreement.”179 On November 16, 2007, the case agents met with Belohlavek and asked if the State Attorney’s Office would oppose a request that Epstein be granted work release. Belohlavek was noncommittal, and when the agents asked that she include language in the state’s plea agreement prohibiting Epstein from participating in work release, she responded that she would have to discuss the issue with the State Attorney.180 Krischer later told OPR that work release was “within the control of the Sheriff’s Office, not my office.” The state’s plea agreement with Epstein did not address the issue of work release. The day after Epstein entered his June 30, 2008 plea, Villafaña and her immediate supervisor met with a Palm Beach Sheriff’s Office official to discuss work release. According to Villafaña, the official told them, “Epstein would be eligible for work release and will be placed on work release,” a statement that contradicted the information the case agents had been given by a jail supervisor the previous November, as well as statements made by defense attorney Jack Goldberger to Villafaña just days before the plea was entered, when he “specifically told [Villafaña] that [Epstein] would not get work release.” Villafaña alerted the Sheriff’s Office official that although Epstein told the court during his plea proceeding that he had worked “every day” for a “couple of years” at the “Florida Science Foundation,” that entity did not even exist until November 2007.181 Moreover, the address Epstein provided to the court for the “Florida Science Foundation” was the office of Epstein’s attorney Jack Goldberger. Villafaña and her supervisor asked that the Sheriff’s Office notify the USAO if Epstein applied for work release. Acosta told OPR that he was aware Villafaña was trying to ensure that Epstein did not get work release, and he would not have contradicted her efforts. Acosta explained that the USAO expected Epstein would be “treated just like everyone else,” but that, as shown by “our subsequent communications with the [S]tate [A]ttorney’s [O]ffice,” having Epstein on work release “was not what our office envisioned.” In August 2008, Villafaña spoke with defense attorney Black about ensuring Epstein’s compliance with the NPA, and raised the issue of work release. Villafaña later reported to Acosta and Sloman that Black assured her he had “reminded the team that . . . 18 months IN JAIL is a material term of the agreement.” The USAO never received notice of Epstein’s work release application. On October 10, 2008, less than three-and-a-half months after Epstein entered his guilty plea, the Palm Beach Sheriff’s Office placed him into the work release program, permitting him to leave the Stockade 179 According to Sloman, Krischer explained that even without registration Epstein would be “treated” as a “sex offender” and that “just like any other sex offender, he can petition the court for work release.” 180 In the November 16, 2007 email, on which she copied Acosta, Villafaña also indicated that she was “reviewing all of the statutes” to determine whether there was any impediment to a state judge granting Epstein work release. In a subsequent email, the FBI case agents informed Villafaña that they had also spoken with a “jail supervisor,” who advised them that although Epstein, as a sexual offender, would not qualify for work release, the judge could nevertheless order him placed on work release if he was sentenced to a year or less of incarceration. 181 During the plea hearing, Epstein told the court he was “President” of the Florida Science Foundation, it had been in existence for 15 years, and he worked there “every day.” Plea Hearing Transcript at 27-29.

115 for up to 12 hours per day, six days per week, to work at the “Florida Science Foundation” office in West Palm Beach.182 In mid-November 2008, Villafaña learned that Epstein was on work release. She notified Acosta, Sloman, and the USAO Criminal Division Chief of this development in an email, and asked, “Can I indict him now?” On November 24, 2008, Villafaña sent defense attorney Black a letter, notifying him that the USAO believed Epstein’s application to and participation in the work release program constituted a material breach of the NPA. Villafaña reminded Black that she had “more than a dozen e-mails” expressing the USAO’s “insistence” that Epstein be incarcerated for 18 months, and that her June 27, 2008 letter to counsel made clear that this meant “confinement for twenty- four hours a day.” Villafaña noted that Goldberger had not inserted the word “imprisoned” into the plea agreement, as he had agreed to do, but instead inserted the term “jail sentence.” Villafaña told counsel: The [USAO’s] Agreement not to prosecute Mr. Epstein was based upon its determination that eighteen months’ incarceration (i.e., confinement twenty-four hours a day) was sufficient to satisfy the federal interest in Mr. Epstein’s crimes. Accordingly, the U.S. Attorney’s Office hereby gives notice that Mr. Epstein has violated the [NPA] by failing to remain incarcerated twenty-four hours a day for the eighteen-month term of imprisonment. The United States will exercise any and all rights it has under the [NPA] unless Mr. Epstein immediately ceases and desists from his breach of this agreement. According to Villafaña, the FBI case agent spoke with the Stockade’s work release coordinator and reported back that that the work release coordinator told her he had been led to believe the government knew Epstein had applied for the program, and that he had been threatened with legal action if he did not allow Epstein to participate in work release. On November 26, 2008, the USAO advised the Department that Acosta was recused from all matters involving the law firm of Kirkland & Ellis, which was still heavily involved in the Epstein case, because Acosta was discussing with the firm the possibility of employment.183 As a result, Sloman became the senior USAO official responsible for making final decisions related to Epstein. Also on November 26, 2008, Black responded to Villafaña’s letter, acknowledging that Epstein was serving his sentence in the Palm Beach County Work Release Program, but denying that Epstein was in breach of the NPA.184 Black noted that the NPA did not prohibit work release; the NPA expressly provided that Epstein was to be afforded the same benefits as any other inmate; 182 Michele Dargan and David Rogers, “Palm Beach sex offender Jeffrey Epstein ‘treated differently,’” Palm Beach Daily News, Dec. 13, 2008. 183 The recusal was formally approved by the Department on December 8, 2008. 184 Black forwarded the email to Sloman, noting that Villafaña “is very concerned about anything Epstein does” and that the defense team would “abide by” Sloman’s decision on the issue.

116 Florida law treated work release as part of confinement; and the Palm Beach County Sheriff’s Office had discretion to grant work release to any inmate. Black also claimed that Acosta “recognized that Mr. Epstein might serve a portion of his sentence through the Work Release Program” and pointed out that the December 6, 2007 draft victim notification letter sent to Lefkowitz for review specifically referred to the victim’s right to be notified “if [Epstein] is allowed to participate in a work release program.” On December 3, 2008, in advance of a scheduled meeting with Black, Villafaña sent Sloman and Criminal Division Chief Senior an email about Epstein’s participation in the work release program: It appears that, since Day 1, Goldberger and Krisher [sic] . . . have been scheming to get Epstein out on work release. For example, the indictment incorrectly charges Epstein for an offense that would have made him ineligible for work release if it had been charged correctly. (Remember that Krisher [sic] also went along with letting us believe that Epstein was pleading to a registrable offense when Epstein’s folks and Krisher [sic] believed that . . . the offense was not registrable.) Krisher [sic] and Goldberger also told us that Epstein would be housed at the Palm [Beach County] Jail, not the Stockade, but he would not have been eligible for work release if at the jail. . . . As part of his work release, Epstein has hired off-duty Sheriff’s deputies to provide him with “protection.” It appears that he is paying between $3000 and $4100 per week for this service, despite the work release rules barring anyone from the Sheriff’s Office (and the Sheriff’s Office itself) from having “any business transactions with inmates . . . while they are in the custody or supervision of the Sheriff . . . .” Villafaña added that she and her immediate supervisor believed that the USAO “should not budge on the 24-hour-a-day incarceration” requirement. Referring to the CVRA litigation, Villafaña also pointed out that two victims had brought suit against the USAO “for failing to keep them informed about the investigation,” and the office had “an obligation to inform all of the victims upon Epstein’s release.” On December 11, 2008, Villafaña wrote to the Corrections Division of the Palm Beach County Sheriff’s Office to express the USAO’s view that Epstein was not eligible for work release and to alert the Sheriff’s Office that Epstein’s work release application contained several inaccuracies and omitted relevant information. Villafaña pointed out that Epstein’s application identified his place of employment as the “Florida Science Foundation,” and the telephone number listed in the application for the “Florida Science Foundation” was the telephone number to the law firm of Epstein’s attorney Jack Goldberger. Villafaña also noted that the individual identified in the work release file as Epstein’s “supervisor” at the “Florida Science Foundation” had submitted publicly available sworn filings to the Internal Revenue Service indicating that Epstein worked only one hour per week and earned no compensation, but that same individual had represented to

117 the Sheriff’s Office that Epstein’s duties required him to work six days a week for 12 hours per day. Finally, Villafaña pointed out that Epstein’s purported “supervisor”—who as the Foundation’s vice president was subordinate to Epstein, the Foundation’s president—had promised to alert the Sheriff’s Office if Epstein failed to comply with his work schedule, but the “supervisor” lived and worked in the New York metropolitan area and was unable to monitor Epstein’s activities on a day-to-day basis. The Sheriff’s Office neither acknowledged nor responded to Villafaña’s letter. In March 2009, Sloman met in Miami with Dershowitz for, as Dershowitz characterized it in a subsequent email, “a relaxed drink and conversation,” which included a discussion of the Epstein case. After that encounter, Dershowitz emailed Sloman, expressing appreciation for Sloman’s “assurance that the feds will not interfere with how the Palm Beach sheriff administers” Epstein’s sentence “as long as he is treated like any similarly situated inmate.” Sloman responded: Regarding Mr. Epstein, the United States Attorney’s Office will not interfere with how the Palm Beach Sheriff’s Office administers the sentence imposed by the Court. That being said, this does not mean that the USAO condones or encourages the PBSO to mitigate the terms and conditions of his sentence. Furthermore, it does not mean that, if contacted for our position concerning alternative custody or in-home detention, we would not object. To be clear, if contacted we will object. Naturally, I also expect that no one on behalf of Mr. Epstein will use my assurance to you to affirmatively represent to PBSO that the USAO does not object to an alternative custody or home detention. A week later, Dershowitz emailed Sloman again, this time expressing appreciation for Sloman’s “willingness to call the sheriff and advise him that your office would take no position on how he handled Epstein’s sentence,” as long as Epstein did not receive special treatment, but adding, “[L]et’s put any call off for a while.” Epstein’s sentence required that he be confined to his home for a 12-month period following his release from prison. On July 22, 2009, almost 13 months after he began serving his sentence, Epstein was released from the Stockade and placed on home confinement.185 At this time, he registered as a sexual offender. XI. POST-RELEASE DEVELOPMENTS In the summer of 2009, allegations surfaced that Epstein had cooperated with the U.S. Attorney’s Office for the Eastern District of New York’s investigation of investment bank Bear Stearns, and that he had been released early from his 18-month imprisonment term because of that 185 In Florida, what is commonly referred to as house arrest is actually the Community Control supervision program. Florida Statute § 948.001(3) defines the program as “a form of intensive, supervised custody in the community.”

118 cooperation.186 When Villafaña spoke with attorneys in the Eastern District of New York, however, an AUSA there told Villafaña that “[t]hey had never heard of” Epstein, and he had not cooperated with the Bear Stearns case.187 During her OPR interview, Villafaña told OPR that to her knowledge, the rumor of Epstein’s cooperation was “completely false.” Villafaña and the USAO continued to monitor Epstein’s compliance with the terms of the NPA. In August 2009, Villafaña alerted her supervisors that Epstein was in apparent violation of his home detention—he had been spotted walking on the beach, and when stopped by the police, he claimed that he was walking “to work” at an office nearly eight miles from his home. Villafaña passed this information along to the Palm Beach County probation office.188 By letter dated September 1, 2009, Black wrote to Sloman seeking the USAO’s agreement to transfer supervision of the community control phase of Epstein’s sentence to the U.S. Virgin Islands, where Epstein maintained his “primary residence.” In response, Villafaña notified Black that the USAO opposed such a request and would view it as a violation of the NPA. Three months later, Sloman met with Dershowitz and, among other issues, informed him that the USAO opposed early termination of Epstein’s community control supervision and would object to a request to transfer Epstein’s supervision to the U.S. Virgin Islands. After serving his year on home detention in Florida, Epstein completed his sentence on July 21, 2010. 186 See “Out of Prison,” New York Post, July 23, 2009. 187 The New York AUSA had emailed Villafaña, “We’re the prosecutors in [the Bear Stearns case] . . . . We saw the below article from the New York Post and wanted to ask you about this defendant, Epstein, who we had never heard of until this morning. We’ve since learned that he is pretty unsavory.” Villafaña reported to Sloman and other supervisors that she “just got off the phone with the prosecutors from the Bear Stearns case in [the Eastern District of] New York. They had seen the NY Post article that claimed that Epstein got such a low sentence because he was cooperating with the feds on the Bear Stearns prosecution. They had never heard of him.” In a second email, she confirmed, “There has been absolutely no cooperation here or in New York, from what they told me.” 188 Black later wrote a letter to Villafaña claiming that Epstein had “specific authorization to walk to work,” the distance between his home and office was “less than three miles,” and when the matter was “fully investigated,” Epstein was found to be in “total compliance” with the requirements of his sentence.

119 CHAPTER TWO PART TWO: APPLICABLE STANDARDS I. OPR’S ANALYTICAL FRAMEWORK OPR finds professional misconduct when an attorney intentionally violates or acts in reckless disregard of a known, unambiguous obligation imposed by law, rule of professional conduct, or Department regulation or policy. In determining whether an attorney has engaged in professional misconduct, OPR uses the preponderance of the evidence standard to make factual findings. An attorney intentionally violates an obligation or standard when the attorney (1) engages in conduct with the purpose of obtaining a result that the obligation or standard unambiguously prohibits; or (2) engages in conduct knowing its natural or probable consequence, and that consequence is a result that the obligation or standard unambiguously prohibits. An attorney acts in reckless disregard of an obligation or standard when (1) the attorney knows or should know, based on his or her experience and the unambiguous nature of the obligation or standard, of an obligation or standard; (2) the attorney knows or should know, based on his or her experience and the unambiguous applicability of the obligation or standard, that the attorney’s conduct involves a substantial likelihood that he or she will violate, or cause a violation of, the obligation or standard; and (3) the attorney nonetheless engages in the conduct, which is objectively unreasonable under all the circumstances. Thus, an attorney’s disregard of an obligation is reckless when it represents a gross deviation from the standard of conduct that an objectively reasonable attorney would observe in the same situation. If OPR determines that an attorney did not engage in professional misconduct, OPR determines whether the attorney exercised poor judgment, engaged in other inappropriate conduct, made a mistake, or acted appropriately under all the circumstances. An attorney exercises poor judgment when, faced with alternative courses of action, he or she chooses a course of action that is in marked contrast to the action that the Department may reasonably expect an attorney exercising good judgment to take. Poor judgment differs from professional misconduct in that an attorney may act inappropriately and thus exhibit poor judgment even though he or she may not have violated or acted in reckless disregard of a clear obligation or standard. In addition, an attorney may exhibit poor judgment even though an obligation or standard at issue is not sufficiently clear and unambiguous to support a professional misconduct finding. A mistake, on the other hand, results from an excusable human error despite an attorney’s exercise of reasonable care under the circumstances. An attorney who makes a good faith attempt to ascertain the obligations and standards imposed on the attorney and to comply with them in a given situation does not commit professional misconduct. Evidence that an attorney made a good faith attempt to ascertain and comply with the obligations and standards imposed can include, but is not limited to, the fact that the attorney reviewed materials that define or discuss one or more potentially applicable obligations and standards, consulted with a supervisor or ethics advisor, notified the tribunal or the attorney representing a party or person with adverse interests of an intended course of conduct, or took

120 affirmative steps the attorney reasonably believed were required to comply with an obligation or standard. II. APPLICABLE STANDARDS OF CONDUCT A. The United States Attorneys’ Manual Among its many provisions, the United States Attorneys’ Manual (USAM) includes general statements of principles that summarize appropriate considerations to be weighed, and desirable practices to be followed, by federal prosecutors when discharging their prosecutorial responsibilities.189 The goal of the USAM is to promote “the reasoned exercise of prosecutorial authority and contribute to the fair, evenhanded administration of the Federal criminal laws,” and to promote public confidence that important prosecutorial decisions will be made “rationally and objectively on the merits of each case.” USAM § 9-27.001. Because the USAM is designed to assist in structuring the decision-making process of government attorneys, many of its principles are cast in general terms, with a view to providing guidance rather than mandating results. Id.; see also USAM § 9-27.120, comment (“It is expected that each Federal prosecutor will be guided by these principles in carrying out his/her criminal law enforcement responsibilities . . . . However, it is not intended that reference to these principles will require a particular prosecutorial decision in any given case.”); USAM § 9-27.110, comment (“Under the Federal criminal justice system, the prosecutor has wide latitude in determining when, whom, how, and even whether to prosecute for apparent violations of Federal criminal law.”). However, USAM § 9-27.130 provides that AUSAs who depart from the principles of federal prosecution articulated in the USAM may be subject to internal discipline. In particular, USAM § 9-27.130 states that each U.S. Attorney should establish internal office procedures to ensure that prosecutorial decisions are made at an appropriate level of responsibility and are consistent with the principles set forth in the USAM, and that serious, unjustified departures from the principles set forth in the USAM are followed by remedial action, including the imposition of disciplinary sanctions when warranted and deemed appropriate. U.S. Attorneys have “plenary authority with regard to federal criminal matters” and may modify or depart from the principles set forth in the USAM as deemed necessary in the interest of fair and effective law enforcement within their individual judicial districts. USAM §§ 9-2.001, 9.27-140. The USAM provisions are supplemented by the Department’s Criminal Resource Manual, which provides additional guidance relating to the conduct of federal criminal prosecutions. 1. USAM Provisions Relating to the Initiation and Declination of a Federal Prosecution Federal prosecutors do not open a case on every matter referred to them. USAM § 9-2.020 explicitly authorizes a U.S. Attorney “to decline prosecution in any case referred directly to 189 In 2018, the USAM was revised and reissued as the Justice Manual. In assessing the subjects’ conduct, OPR relies upon the standards of conduct in effect at the time of the events in issue. Accordingly, unless otherwise noted, citations in this Report are to the 1997 edition of the USAM, as revised through January 2007.

121 him/her by an agency unless a statute provides otherwise.” Whenever a U.S. Attorney closes a case without prosecution, the file should reflect the action taken and the reason for it. USAM § 9-27.220 sets forth the grounds to be considered in making the decision whether to commence or decline federal prosecution. A federal prosecutor should commence or recommend prosecution if he or she believes that admissible evidence will probably be sufficient to obtain and sustain a conviction of a federal offense, unless (1) the prosecution would serve no federal interest; (2) the person is subject to effective prosecution in another jurisdiction; or (3) there exists an adequate alternative to prosecution. A comment to this provision indicates that it is the prosecutor’s task to determine whether these circumstances exist, and in making that determination, the prosecutor “should” consult USAM §§ 9-27.230, 9-27.240, or 9-27.250, as appropriate. USAM § 9-27.230 sets forth a non-exhaustive list of considerations that a federal prosecutor should weigh in determining whether a substantial federal interest would be served by initiating prosecution against a person: 1. Federal law enforcement priorities;190 2. The nature and seriousness of the offense;191 3. The deterrent effect of prosecution; 4. The person’s culpability in connection with the offense; 5. The person’s history with respect to criminal activity; 6. The person’s willingness to cooperate in the investigation or prosecution of others; and 7. The probable sentence or other consequences if the person is convicted. The USAM contemplates that, on occasion, a federal prosecutor will decline to open a case in deference to prosecution by the state in which the crime occurred. USAM § 9-27.240 directs that in evaluating the effectiveness of prosecution in another jurisdiction, the federal prosecutor should weigh “all relevant considerations,” including the strength of the other jurisdiction’s interest in prosecution, the other jurisdiction’s ability and willingness to prosecute effectively, and the probable sentence or other consequences the person will be subject to if convicted in the other jurisdiction. A comment to this provision explains: 190 A comment to this provision directs the prosecutor to consider carefully the extent to which a federal prosecution would be consistent with established federal prosecutorial priorities. 191 A comment to this provision explains that an assessment of the nature and seriousness of the offense must also include consideration of the impact on the victim. The comment further cautions that when restitution is at issue, “care should be taken . . . to ensure against contributing to an impression that an offender can escape prosecution merely by returning the spoils of his/her crime.”

122 Some offenses, even though in violation of Federal law, are of particularly strong interest to the authorities of the state or local jurisdiction in which they occur, either because of the nature of the offense, the identity of the offender or victim, the fact that the investigation was conducted primarily by state or local investigators, or some other circumstance. Whatever the reason, when it appears that the Federal interest in prosecution is less substantial than the interest of state or local authorities, consideration should be given to referring the case to those authorities rather than commencing or recommending a Federal prosecution. Another comment cautions that in assessing whether to defer to state or local authorities, “the Federal prosecutor should be alert to any local conditions, attitudes, relationships or other circumstances that might cast doubt on the likelihood of the state or local authorities conducting a thorough and successful prosecution.” USAM § 9-27.260 identifies impermissible considerations relating to the decision whether to initiate or decline a federal prosecution. Specifically, the decision may not be based on consideration of the person’s race, religion, sex, national origin, or political association, activities, or beliefs; the prosecutor’s “own personal feelings” about the person or the victim; or the possible effect of the decision on the prosecutor’s own professional or personal circumstances. When opting to decline federal prosecution, the prosecutor should ensure that the reasons for that decision are communicated to the investigating agency and reflected in the office files. USAM § 9-27.270. 2. USAM § 9-2.031: The Petite Policy Although the Constitution does not prohibit prosecutions of a defendant by both state and federal authorities, even when the conduct charged is identical in both charging jurisdictions, the Department has a long-standing policy, known as the Petite policy, governing federal prosecutions charged after the initiation of a prosecution in another jurisdiction based on the same or similar conduct.192 The general principles applicable to the prosecution or declination decision are set forth in USAM § 9-2.031, “Dual and Successive Prosecution Policy (‘Petite Policy’),” which contains guidelines for a federal prosecutor’s exercise of discretion in determining whether to bring a federal prosecution based on the substantially same act or transaction involved in a prior state or federal proceeding. The policy applies “whenever there has been a prior state or federal prosecution resulting in an acquittal, a conviction, including one resulting from a plea agreement, or a dismissal or other termination on the merits after jeopardy has attached.” In circumstances in which the policy applies, a prosecutor nonetheless can initiate a new federal prosecution when three substantive prerequisites exist. The prerequisites are as follows: (1) The matter must involve a substantial federal interest. The determination whether a substantial federal interest is involved is made on a case-by-case basis. Matters 192 See Rinaldi v. United States, 434 U.S. 22, 27-29 (1977); Petite v. United States, 361 U.S. 529 (1960).

123 that come within the national investigation and prosecution priorities established by the Department are more likely to satisfy this requirement than other matters. (2) The prior prosecution must have left the substantial federal interest “demonstrably unvindicated.” In general, the Department presumes that a prior prosecution has vindicated federal interests, but that presumption may be overcome in certain circumstances. As relevant here, the presumption may be overcome when the choice of charges in the prior prosecution was based on factors such as incompetence, corruption, intimidation, or undue influence. The presumption may be overcome even when the prior prosecution resulted in a conviction, if the prior sentence was “manifestly inadequate in light of the federal interest involved and a substantially enhanced sentence—including forfeiture and restitution as well as imprisonment and fines—is available through the contemplated federal prosecution.” (3) The government must believe that the defendant’s conduct constitutes a federal offense, and that the admissible evidence probably will be sufficient to obtain and sustain a conviction. However, the satisfaction of the prerequisites does not require a prosecutor to proceed with a federal investigation or charges nor is the Department required to approve the proposed prosecution. The Petite policy cautions that whenever a matter involves overlapping federal and state jurisdiction, federal prosecutors should consult with their state counterparts “to determine the most appropriate single forum in which to proceed to satisfy the substantial federal and state interests involved.” If a substantial question arises as to whether the Petite policy applies to a particular prosecution, the prosecutor should submit the matter to the appropriate Assistant Attorney General for resolution. Prior approval from the appropriate Assistant Attorney General must be obtained before bringing a prosecution governed by this policy. 3. USAM Provisions Relating to Plea Agreements Federal prosecutors have discretion to resolve an investigation or pending case through a plea agreement. USAM §§ 9-27.330; 9-27.400. Negotiated pleas are also explicitly sanctioned by Federal Rule of Criminal Procedure 11(c)(1).193 Regardless of whether the plea agreement is offered pre-charge or post-charge, the prosecutor’s plea bargaining “must honestly reflect the totality and seriousness of the defendant’s conduct.” USAM § 9-27.400, comment.194 The importance of selecting a charge that reflects the seriousness of the conduct is echoed in USAM § 9-27.430, which directs the prosecutor to require a defendant to plead to an offense that represents the most serious readily provable charge consistent with the nature and extent of the 193 As previously noted, Rule 11(c)(1)(C) permits the parties to agree to resolve the case in exchange for a specific sentence, subject to the court’s acceptance of the agreement. 194 See also USAM § 9-27.300 (“Once the decision to prosecute has been made, the attorney for the government should charge . . . the most serious offense that is consistent with the nature of the defendant’s conduct, and that is likely to result in a sustainable conviction.”).

124 defendant’s criminal conduct, has an adequate factual basis, makes likely the imposition of an appropriate sentence and order of restitution, and does not adversely affect the investigation or prosecution of others. USAM § 9-27.420 specifies: In determining whether it would be appropriate to enter into a plea agreement, the attorney for the government should weigh all relevant considerations, including: 1. The defendant’s willingness to cooperate in the investigation or prosecution of others; 2. The defendant’s history with respect to criminal activity; 3. The nature and seriousness of the offense or offenses charged; 4. The defendant’s remorse or contrition and his/her willingness to assume responsibility for his/her conduct; 5. The desirability of prompt and certain disposition of the case; 6. The likelihood of obtaining a conviction at trial; 7. The probable effect on witnesses; 8. The probable sentence or other consequences if the defendant is convicted; 9. The public interest in having the case tried rather than disposed of by a guilty plea; 10. The expense of trial and appeal; 11. The need to avoid delay in the disposition of other pending cases; and 12. The effect upon the victim’s right to restitution. 4. USAM Provisions Relating to Non-Prosecution Agreements USAM § 9-27.600 authorizes government attorneys to enter into a non-prosecution agreement in exchange for a person’s cooperation. The provision explains that a non-prosecution agreement is appropriate for this purpose when, in the prosecutor’s judgment, the person’s timely cooperation “appears to be necessary to the public interest and other means of obtaining the desired cooperation are unavailable or would not be effective.” A comment to this provision explains that such “other means” include seeking cooperation after trial and conviction, bargaining for

125 cooperation as part of a plea agreement, or compelling cooperation under a “use immunity” order. The comment observes that these alternative means “are clearly preferable to permitting an offender to avoid any liability for his/her conduct” and “should be given serious consideration in the first instance.” USAM §§ 9-27.620 and 9-27.630 set forth considerations a prosecutor should take into account when entering into a non-prosecution agreement. Generally, the U.S. Attorney has authority to approve a non-prosecution agreement. USAM § 9-27.600 comment. However, USAM § 9-27.640 directs that a government attorney should not enter into a non-prosecution agreement in exchange for a person’s cooperation without first obtaining the approval of the appropriate Assistant Attorney General, or his or her designee, when the person is someone who “is likely to become of major public interest.” These USAM provisions do not address the uses of non-prosecution agreements in circumstances other than when needed to obtain cooperation. 5. USAM Provisions Relating to Grants of Immunity Nothing in the USAM directly prohibits the government from using the criminal exposure of third parties in negotiating with a criminal defendant. Instead, the provision that addresses immunity relates only to the exchange of limited immunity for the testimony of a witness who has asserted a Fifth Amendment privilege against self-incrimination. See USAM §§ 9-23.100 et seq. 6. USAM/C.F.R. Provisions Relating to Financial Conflicts of Interest Department employees are expected to be aware of, and to comply with, all ethics-related laws, rules, regulations, and policies. See, generally, USAM § 1-4.000 et seq. Specifically, a government attorney is prohibited by criminal statute from participating personally and substantially in any particular matter in which he has a financial interest or in which such an interest can be imputed to him. See 18 U.S.C. § 208 and 5 C.F.R. §§ 2635.401-402. In addition, a Department employee should seek advice from an ethics official before participating in any matter in which his impartiality could be questioned. If a conflict of interest exists, in order for the employee to participate in the matter, the head of the employee’s component, with the concurrence of an ethics official, must make a determination that the interest of the government in the employee’s participation outweighs the concern that a reasonable person may question the integrity of the Department’s programs and operations. The determination must be made in writing. See 5 C.F.R. §§ 2635.501-502. B. Other Department Policies 1. Department Policies Relating to the Disposition of Charges The Attorney General has the responsibility for establishing prosecutorial priorities for the Department. Over the span of several decades, each successive Attorney General has articulated those priorities in policy memoranda issued to all federal prosecutors. As applicable here, on September 22, 2003, Attorney General John Ashcroft issued a memorandum regarding “Department Policy Concerning Charging Criminal Offenses, Disposition of Charges, and Sentencing” (Ashcroft Memo). The Ashcroft Memo, which explicitly superseded all previous Departmental guidance on the subject, set forth policies “designed to ensure that all federal

126 prosecutors adhere to the principles and objectives” of the Sentencing Reform Act of 1984, the Sentencing Guidelines, and the PROTECT Act “in their charging, case disposition, and sentencing practices.”195 The Ashcroft Memo directed that, “in all federal cases, federal prosecutors must charge and pursue the most serious, readily provable offense or offenses that are supported by the facts of the case,” except as authorized by an Assistant Attorney General, U.S. Attorney, or designated supervisory authority in certain articulated limited circumstances. The Ashcroft Memo cautioned that a charge is not “readily provable” if the prosecutor harbors a good faith doubt, based on either the law or the evidence, as to the government’s ability to prove the charge at trial. The Ashcroft Memo explains that the “basic policy” “requires federal prosecutors to charge and pursue all charges that are determined to be readily provable” and would yield the most substantial sentence under the Sentencing Guidelines. The policy set forth six exceptions, including a catch-all exception that permits a prosecutor to decline to pursue readily provable charges “in other exceptional circumstances” with the written or otherwise documented approval of an Assistant Attorney General, U.S. Attorney, or “designated supervisory attorney.” As examples of circumstances in which such declination would be appropriate, the Ashcroft Memo cites to situations in which a U.S. Attorney’s Office is “particularly over-burdened,” the trial is expected to be of exceptionally long duration, and proceeding to trial would significantly reduce the total number of cases the office could resolve. The Ashcroft Memo specifically notes that “[c]harges may be declined . . . pursuant to a plea agreement only to the extent consistent” with the policies established by the Memo. On January 28, 2005, Deputy Attorney General James Comey issued a memorandum entitled “Department Policies and Procedures Concerning Sentencing.” That memorandum reiterated that federal prosecutors “must continue to charge and pursue the most serious readily provable offenses,” and defined that term as the offenses that would “generate the most substantial sentence” under the Sentencing Guidelines, any applicable mandatory minimum, and any statutorily required consecutive sentence. Importantly, although the Ashcroft and Comey memoranda limit an individual line prosecutor’s ability to decline “readily provable” charges in their entirety, no such restriction is placed upon the U.S. Attorneys, who retained authority to approve exceptions to the policy. In addition, the policy applies to “readily provable” charges, thus inherently allowing a prosecutor 195 The Ashcroft Memo was issued before the Supreme Court decided United States v. Booker, 543 U.S. 220 (2005), which struck down the provision of the federal sentencing statute that required federal district judges to impose a sentence within the applicable Federal Sentencing Guidelines range. Those Guidelines were the product of the United States Sentencing Commission, which was created by the Sentencing Reform Act of 1984. The Prosecutorial Remedies and Other Tools to End the Exploitation of Children Today (PROTECT) Act of 2003, Pub. L. 108–21, 117 Stat. 650, was directed at preventing child abuse. It included a variety of provisions designed to improve the investigation and prosecution of violent crimes against children. Among other things, the PROTECT Act provided for specific sentencing considerations for certain sex-related offenses, such as those involving multiple occasions of prohibited sexual conduct or those involving material with depictions of violence or with specified numbers of images.

127 flexibility to decline to bring a particular charge based on a “good faith doubt” that the law or evidence supports the charge. 2. Department Policy Relating to Deportation of Criminal Aliens On April 28, 1995, the Attorney General issued a memorandum to all federal prosecutors entitled “Deportation of Criminal Aliens,” directing federal prosecutors to actively and directly become involved in the process of removing criminal aliens from the United States. In pertinent part, this memorandum notes that prosecutors can make a major contribution to the expeditious deportation of criminal aliens by effectively using available prosecution tools for dealing with alien defendants. These tools include (1) stipulated administrative deportation orders in connection with plea agreements; (2) deportation as a condition of supervised release under 18 U.S.C. § 3853(d); and (3) judicial deportation orders pursuant to 8 U.S.C. § 1252a(d). The memorandum further directs: All deportable criminal aliens should be deported unless extraordinary circumstances exist. Accordingly, absent such circumstances, Federal prosecutors should seek the deportation of deportable alien defendants in whatever manner is deemed most appropriate in a particular case. Exceptions to this policy must have the written approval of the United States Attorney. See also USAM § 9-73.520. A “criminal alien” is a foreign national who has been convicted of a crime.196 Stipulated administrative deportation orders can be based “on the conviction for an offense to which the alien will plead guilty,” provided that the offense is one of those enumerated in 8 U.S.C. § 1251 as an offense that causes an alien to be deported. Under 8 U.S.C. § 1251(a)(2)(A)(i), any alien who is convicted of a crime of “moral turpitude” within five years after the date of entry (or 10 years in the case of an alien provided lawful permanent resident status), and is either sentenced to confinement or confined to prison for one year or longer, is deportable. C. Case Law 1. Prosecutorial Discretion On many occasions, the Supreme Court has discussed the breadth of the prosecutor’s discretion in deciding whether and whom to prosecute. In Bordenkircher v. Hayes, 434 U.S. 357 (1978), the Court considered the propriety of a prosecutor’s threat during plea negotiations to seek more serious charges against the accused if the accused did not plead guilty to the offense originally charged. The defendant, Hayes, opted not to plead guilty to the original offense, and 196 According to the U.S. Customs and Border Protection, “The term ‘criminal alien’ refers to aliens who have been convicted of one or more crimes, whether in the United States or abroad, prior to interdiction by the U.S. Border Patrol.” See U.S. Dept. of Homeland Security, U.S. Customs and Border Protection, CBP Enforcement Statistics, Criminal Alien Statistics Fiscal Year 2020, available at https://www.cbp.gov/newsroom/stats/cbp-enforcement- statistics/criminal-alien-statistics.

128 the prosecutor indicted him on more serious charges. Hayes was thereafter convicted and sentenced under the new indictment. The state court of appeals rejected Hayes’s challenge to his conviction, concluding that the prosecutor’s decision to indict on more serious charges was a legitimate use of available leverage in the plea-bargaining process. Hayes filed for review of his conviction and sentence in federal court, and although Hayes lost at the district court level, the U.S. Court of Appeals for the Sixth Circuit concluded that the prosecutor’s conduct constituted impermissible vindictive prosecution. The Supreme Court reversed the Sixth Circuit’s ruling. The Court opined that “acceptance of the basic legitimacy of plea bargaining necessarily implies rejection of any notion that a guilty plea is involuntary in a constitutional sense simply because it is the end result of the bargaining process.” Id. at 363. A long as the prosecutor has probable cause to believe a crime has been committed, “the decision whether or not to prosecute, and what charge to file or bring before a grand jury, rests entirely in his discretion.” Id. at 364 (emphasis added). The Court explained that selectivity in enforcement of the criminal law is not improper unless based upon an unjustifiable standard such as race, religion, or other arbitrary classification. Id. These principles were reiterated in Wayte v. United States, 470 U.S. 598 (1985), a case involving the government’s policy of prosecuting only those individuals who reported themselves as having failed to register with the Selective Service system. The petitioner in Wayte claimed that the self-reported non-registrants were “vocal” opponents of the registration program who were being punished for the exercise of their First Amendment rights. The Supreme Court rejected this argument, stating that the government has “broad discretion” in deciding whom to prosecute, and that the limits of that discretion are reached only when the prosecutor’s decision is based on an unjustifiable standard. Id. at 607-08. Because the passive enforcement policy was not intended to have a discriminatory effect, the claim of selective prosecution failed. In Imbler v. Pachtman, 424 U.S. 409 (1976), the Supreme Court considered whether a state prosecutor acting within the scope of his duties could be sued under 42 U.S.C. § 1983 for violation of the defendant’s constitutional rights when the defendant alleged that the prosecutor and others had unlawfully conspired to charge and convict him. The Court held that “in initiating a prosecution and in presenting the State’s case,” conduct that is “intimately associated with the judicial phase of the criminal process,” the prosecutor enjoyed absolute immunity from a civil suit for damages. Id. at 430-31. In Harrington v. Almy, 977 F.2d 37 (1st Cir. 1992), the court applied Imbler to a challenge to a prosecutor’s decision not to prosecute. The court noted that “given the availability of immunity for the decision to charge, it becomes even more important that symmetrical protection be available for the decision not to charge.” Id. at 41 (emphasis in original). Finally, in an analogous area of the law, in Heckler v. Chaney, 470 U.S. 821 (1985), the Supreme Court concluded that an agency’s decision not to undertake an enforcement action is not reviewable under the federal Administrative Procedure Act, 5 U.S.C. §§ 500-706. 2. Plea Agreement Promises of Leniency towards a Third Party Case law regarding promises made during plea negotiations not to prosecute a third-party arises in two contexts. First, defendants have challenged the voluntariness of the resulting plea

129 when prosecutors have used third parties as leverage in plea negotiations. Numerous courts have made clear, however, that a plea is not invalid when entered under an agreement that includes a promise of leniency towards a third party or in response to a prosecutor’s threat to prosecute a third party if a plea is not entered. See, e.g., United States v. Marquez, 909 F.2d 738, 741-42 (2d Cir. 1990) (rejecting claim that plea was involuntary because of pressure placed upon a defendant by the government’s insistence that a defendant’s wife would not be offered a plea bargain unless he pled guilty); Martin v. Kemp, 760 F.2d 1244, 1248 (11th Cir. 1985) (in order to satisfy “heavy burden” of establishing that the government had not acted “in good faith,” a defendant challenging voluntariness of his plea on grounds that the prosecutor had threatened to bring charges against the defendant’s pregnant wife had to establish that government lacked probable cause to believe the defendant’s wife had committed a crime at the time it threatened to charge her); Stinson v. State, 839 So. 2d 906, 909 (Fla. App. 2003) (“In cases involving . . . a promise not to prosecute a third party, the government must act in good faith . . . [and] must have probable cause to charge the third party.”). The second context concerns situations in which courts have enforced prosecutors’ promises of leniency to third parties. For example, in State v. Frazier, 697 So. 2d 944 (Fla. App. 1997), as consideration for the defendant’s guilty plea, the prosecutor agreed and announced in open court that the government would dismiss charges against the defendant’s niece and nephew, who had all been charged as a result of the same incident. When the state reneged and attempted to prosecute the niece and nephew, the trial court dismissed the charges against them, and the state appealed. The appellate court affirmed the dismissal, concluding that under contract law principles, the niece and nephew were third-party beneficiaries of the plea agreement and were therefore entitled to enforce it. Apart from voluntariness or enforceability concerns, courts have not suggested that a prosecutor’s promise not to prosecute a third party amounts to an inappropriate exercise of prosecutorial discretion. D. State Bar Rules During the period relevant to this Report, the five subject attorneys were members of the bar in several different states and were subject to the rules of professional conduct in each state in which they held membership.197 In determining which rules apply, OPR applied the local rules of the U.S. District Court for the Southern District of Florida (Local Rules) and the choice-of-law provisions of each applicable bar. Local Rule 11.1(f) incorporates rules governing the admission, practice, peer review, and discipline of attorneys (Attorney Admission Rules).198 Attorney Admission Rule 4(d) provides that any U.S. Attorney or AUSA employed full-time by the government may appear and participate in particular actions or proceedings on behalf of the United States in the attorney’s official capacity without petition for admission. Any attorney so appearing 197 The subjects’ membership in state bars other than Florida would not affect OPR’s conclusions in this case. 198 These rules have been in effect since December 1994.

130 is subject to all rules of the court.199 Attorney Admission Rule 6(b)(2)(A) makes clear that attorneys practicing before the court are subject to the Florida Bar’s Rules of Professional Conduct (FRPC). Moreover, the choice-of-law provisions contained within the relevant state’s rules of professional conduct make the FRPC applicable to their conduct. 1. FRPC 4-1.1 – Competence FRPC 4-1.1 requires that a lawyer provide competent representation to a client.200 Competent representation requires the legal knowledge, skill, thoroughness, and preparation reasonably necessary for the representation. A comment to the rule clarifies that the factors relevant to determining a lawyer’s competence to handle a particular matter include “the relative complexity and specialized nature of the matter, the lawyer’s general experience, the lawyer’s training and experience in the field in question, the preparation and study the lawyer is able to give the matter, and whether it is feasible to refer the matter to, or associate or consult with, a lawyer of established competence in the field.” The comment further notes that “[i]n many instances the required proficiency is that of a general practitioner.” With respect to particular matters, competence requires inquiry into and analysis of the factual and legal elements of the problem. The comment to Rule 4-1.1 explains that “[t]he required attention and preparation are determined in part by what is at stake; major litigation and complex transactions ordinarily require more extensive treatment than matters of lesser complexity and consequence.” 2. FRPC 4-1.3 – Diligence FRPC 4-1.3 specifies that a lawyer should act with reasonable diligence and promptness in representing a client. A comment to this rule explains, “A lawyer should pursue a matter on behalf of a client despite opposition, obstruction, or personal inconvenience to the lawyer and take whatever lawful and ethical measures are required to vindicate a client’s cause or endeavor.” A lawyer must exercise “zeal” in advocating for the client, but is not required “to press for every advantage that might be realized for a client.” 3. FRPC 4-4.1 – Candor in Dealing with Others FRPC 4-4.1 prohibits a lawyer from knowingly making a false statement of material fact or law to a third person during the course of representation of a client. A comment to this rule explains that “[m]isrepresentations can also occur by partially true but misleading statements or omissions that are the equivalent of affirmative false statements,” and “[w]hether a particular statement should be regarded as one of fact can depend on the circumstances.” 199 See also 28 U.S.C. § 530B(a), providing that government attorneys are subject to state laws and state and local federal court rules governing attorneys in each state where the government attorney engages in his duties. 200 The federal prosecutor does not have an individual “client,” but rather represents the people of the United States. See generally 28 U.S.C. § 547 (duties of U.S. Attorney); 28 C.F.R. § 0.5(b) (the Attorney General represents the United States in legal matters).

131 4. FRPC 4-8.4 – Conduct Prejudicial to the Administration of Justice FRPC 4-8.4(c) states that a lawyer shall not engage in conduct involving dishonesty, fraud, deceit, or misrepresentation. FRPC 4-8.4(d) prohibits a lawyer from engaging in conduct in connection with the practice of law that is prejudicial to the administration of justice. In Florida Bar v. Frederick, 756 So. 2d 79, 87 (Fla. 2000), the court noted that FRPC 4-8.4(d) is not limited to conduct that occurs in a judicial proceeding, but can be applied to “conduct in connection with the practice of law.” In Florida Bar v. Shankman, 41 So. 3d 166, 172 (Fla. 2010), for example, an attorney’s continuous hiring and firing of firms to assist in the client’s matter resulted in delayed resolution of the case and constituted a violation of FRPC 4-8.4(d) due to the delay in the administration of justice and the increased costs to the client.201 201 OPR also examined FRPC 4-3.8, Special Responsibilities of a Prosecutor. Nothing in the text of that rule, however, was relevant to the issues addressed in this Report. A comment to FRPC Rule 4-3.8 notes that Florida has adopted the American Bar Association (ABA) Standards of Criminal Justice Relating to the Prosecution Function. These “standards,” however, are not binding rules of conduct but rather provide guidance to prosecutors. Indeed, the ABA has expressly stated that these standards “are not intended to serve as the basis for the imposition of professional discipline, to create substantive or procedural rights for accused or convicted persons, to create a standard of care for civil liability, or to serve as a predicate for a motion to suppress evidence or dismiss a charge.” OPR does not consider the ABA standards as binding on the conduct of Department prosecutors.

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133 CHAPTER TWO PART THREE: ANALYSIS I. OVERVIEW Following the Miami Herald report in November 2018, media scrutiny of and public attention to the USAO’s handling of its Epstein investigation has continued unabated. At the heart of the public’s concern is the perception that Epstein’s 18-month sentence, which resulted in a 13- month term of actual incarceration, was too lenient and inadequately punished Epstein’s criminal conduct. Although many records have been released as part of civil litigation stemming from Epstein’s conduct, the public has received only limited information regarding the decision-making process leading to the signed NPA. As a result, questions have arisen about Acosta and his staff’s motivations for entering into the NPA. Publicly released communications between prosecutors and defense counsel, the leniency of the sentence, and an unusual non-prosecution provision in the NPA have led to allegations that Acosta and the USAO gave Epstein a “sweetheart deal” because they were motivated by improper influences, such as their preexisting and personal relationships with his attorneys, or even corrupt influences, such as the receipt of personal benefits from Epstein. Through its investigation, OPR has sought to answer the following core questions: (1) who was responsible for the decision to resolve the federal investigation through the NPA and for its specific terms; (2) did the NPA or any of its provisions violate Department policies or other rules or regulations; and (3) were any of the subjects motivated to resolve the federal investigation by improper factors, such as corruption or favoritism. To the extent that available records and witness interviews shed light on these questions, OPR shows in detail the process that led to the NPA, from the initial complaint to the USAO through the intense and often confusing negotiation process. After a thorough and detailed examination of thousands of contemporaneous records and extensive interviews of subjects and witnesses, OPR is able to answer most of the significant questions concerning the NPA’s origins and development. Although some questions remain, OPR sets forth its conclusions and the bases for them in this Part. II. ACOSTA REVIEWED AND APPROVED THE TERMS OF THE NPA AND IS ACCOUNTABLE FOR IT Although Acosta did not sign the NPA, he approved it, with knowledge of its terms. He revised drafts of the NPA and added language that he thought appropriate. Acosta told OPR that he either was informed of, or had access to information concerning, the underlying facts of the case against Epstein. OPR did not find any evidence suggesting that any of his subordinates misled him about the facts or withheld information that would have influenced his decision, and Acosta did not make such a claim to OPR. As Acosta affirmed in his OPR interview, the “three pronged resolution, two years . . . , registration and restitution, . . . ultimately that was approved on my authority. . . . [U]ltimately, I approved it, and so, I . . . accept that. I’m not . . . pushing away responsibility for it.” In making its misconduct assessments, OPR considers the conduct of subjects individually. Menchel, Sloman, Lourie, and Villafaña were involved in the matter to varying degrees, at

134 different points in time, and regarding different decisions. Menchel, for example, participated in formulating the USAO’s initial written offer to the defense, but he had no involvement with actions or decisions made after August 3, 2007. Sloman was absent during part of the most intense negotiations in September 2007 and did not see the final, signed version of the NPA until he returned. Villafaña and Lourie participated in the negotiations, and Lourie either made decisions during the September 12, 2007 meeting with the defense and State Attorney’s Office, or at least indicated agreement pending Acosta’s approval. In any event, whatever the level of Sloman’s, Menchel’s, Lourie’s, and Villafaña’s involvement, they acted with the knowledge and approval of Acosta. Under OPR’s analytical framework, an attorney who makes a good faith attempt to ascertain the obligations and standards imposed on the attorney and to comply with them in a given situation does not commit professional misconduct. Evidence that an attorney made a good faith attempt to ascertain and comply with the obligations and standards imposed can include, but is not limited to, the fact that the attorney consulted with a supervisor.202 In this regard, OPR’s framework is similar to a standard provision of the professional conduct rules of most state bars, which specify that a subordinate lawyer does not engage in misconduct if that lawyer acts in accordance with a supervisory lawyer’s reasonable resolution of an arguable question of professional duty. See, e.g., FRPC 4-5.2(b). Therefore, in addition to the fact that OPR did not find a violation of a clear and unambiguous standard as discussed below, OPR concludes that Menchel, Sloman, Lourie, and Villafaña did not commit professional misconduct with respect to any aspect of the NPA because they acted under Acosta’s direction and with his approval. III. OPR FOUND THAT NONE OF THE SUBJECTS VIOLATED A CLEAR AND UNAMBIGUOUS STATUTE, PROFESSIONAL RESPONSIBILITY RULE OR STANDARD, OR DEPARTMENT REGULATION OR POLICY, IN NEGOTIATING, APPROVING, OR ENTERING INTO THE NPA A central issue OPR addressed in its investigation relating to the NPA was whether any of the subjects, in developing, negotiating, or entering into the NPA, violated any clear and unambiguous standard established by rule, regulation, or policy. OPR does not find professional misconduct unless a subject attorney intentionally or recklessly violated a clear and unambiguous standard. OPR considered three specific areas: (1) standards implicated by the decision to decline a federal court prosecution; (2) standards implicated by the decision to resolve the federal investigation through a non-prosecution agreement; and (3) standards implicated by any of the NPA’s provisions, including the promise not to prosecute unidentified third parties. As discussed below, OPR concludes that in each area, and in the absence of evidence establishing that his decisions were based on corrupt or improper influences, the U.S. Attorney possessed broad discretionary authority to proceed as he saw fit, authority that he could delegate to subordinates, and that Acosta’s exercise of his discretionary authority did not breach any clear and unambiguous standard. As a result, OPR concludes that none of the subject attorneys violated a clear and 202 The failure to fully advise a supervisor of relevant and material facts can warrant a finding that the subordinate attorney has not acted in “good faith.” OPR did not find evidence supporting such a conclusion here, and Acosta did not claim that he was unaware of material facts needed to make his decision.

135 unambiguous standard or engaged in professional misconduct in developing, negotiating, or entering into the NPA, including its addendum. A. U.S. Attorneys Have Broad Discretion to Resolve Investigations or Cases as They Deem Appropriate, and Acosta’s Decision to Decline to Prosecute Epstein Federally Does Not Constitute Professional Misconduct The U.S. Attorneys exercise broad discretion in enforcing the nation’s criminal laws.203 As a general matter, federal prosecutors “are designated by statute as the President’s delegates to help him discharge his constitutional responsibility to ‘take Care that the Laws be faithfully executed.’” United States v. Armstrong, 517 U.S. 456, 464 (1996) (quoting U.S. Const. art. II, § 3). Unless based on an impermissible standard such as race, religion, or other arbitrary classification, a prosecutor’s charging decisions—including declinations—are not dictated by law or statute and are not subject to judicial review. See United States v. LaBonte, 520 U.S. 751, 762 (1997) (“Such discretion is an integral feature of the criminal justice system, and is appropriate, so long as it is not based upon improper factors.”). Department policy guidance in effect at the time the USAO was handling the Epstein case helped ensure “the reasoned exercise of prosecutorial authority,” but did not require “a particular prosecutorial decision in any given case.” USAM §§ 9-27.001, 9-27.120 (comment). Rather than mandating specific actions, the USAM identified considerations that should factor into a prosecutor’s charging decisions, including that the defendant was “subject to effective prosecution in another jurisdiction.” USAM § 9-27.220. Importantly, U.S. Attorneys had “plenary authority with regard to federal criminal matters” and could modify or depart from the principles set forth in the USAM as deemed necessary in the interest of fair and effective law enforcement within their individual judicial districts. USAM §§ 9-2.001, 9-27.140. As stated in the USAM, “[t]he United States Attorney is invested by statute and delegation from the Attorney General with the broadest discretion in the exercise of such [prosecutive] authority,” which includes the authority to decline prosecution. USAM § 9-2.001. In addition, the USAM contemplated that federal prosecutors would sometimes decline federal prosecution in deference to a state prosecution of the same conduct and provided guidance in the form of factors to be considered in making the decision, including the strength of the other jurisdiction’s interest in prosecution, the other jurisdiction’s ability and willingness to prosecute effectively, and the probable sentence or other consequences if the person is convicted in the other jurisdiction. USAM § 9-27.240.204 A comment to this provision stated that the factors are “illustrative only, and the attorney for the government should also consider any others that appear relevant to hi[m]/her in a particular case.” 203 See, e.g., Wayte, 470 U.S. at 607; United States v. Goodwin, 457 U.S. 368, 380 n.11 (1982); Bordenkircher, 434 U.S. at 364; Imbler, 424 U.S. 409. 204 The discretionary authority under USAM § 9-27.240 to defer prosecution in favor of another jurisdiction is distinct from the Petite policy, which establishes guidelines for the exercise of discretion in determining whether to bring a federal prosecution based on conduct substantially the same as that involved in a prior state or federal proceeding. See USAM § 9-2.031.

136 As the U.S. Attorney, and in the absence of evidence establishing that his decision was motivated by improper factors, Acosta had the “plenary authority” under federal law and under the USAM to resolve the case as he deemed necessary and appropriate. As discussed in detail below, OPR did not find evidence establishing that Acosta, or the other subjects, were motivated or influenced by improper considerations. Because no clear and unambiguous standard required Acosta to indict Epstein on federal charges or prohibited his decision to defer prosecution to the state, OPR does not find misconduct based on Acosta’s decision to decline to initiate a federal prosecution of Epstein. B. No Clear and Unambiguous Standard Precluded Acosta’s Use of a Non-Prosecution Agreement to Resolve the Federal Investigation of Epstein OPR found no statute or Department policy that was violated by Acosta’s decision to resolve the federal investigation of Epstein through a non-prosecution agreement. The prosecutor’s broad charging discretion includes the option of resolving a case through a non-prosecution agreement or a related and similar mechanism, a deferred prosecution agreement. United States v. Fokker Servs. B.V., 818 F.3d 733 (D.C. Cir. 2016). These agreements “afford a middle-ground option to the prosecution when, for example, it believes that a criminal conviction may be difficult to obtain or may result in unwanted collateral consequences for a defendant or third parties, but also believes that the defendant should not evade accountability altogether.” Id. at 738. As with all prosecutorial charging decisions, the choice to resolve a case through a non-prosecution agreement or a deferred prosecution agreement “resides fundamentally with the Executive” branch. Id. at 741. OPR found no clear and unambiguous standard in the USAM prohibiting the use of a non- prosecution agreement in the circumstances presented in Epstein’s case. The USAM specifically authorized and provided guidance regarding non-prosecution agreements or deferred prosecution agreements made in exchange for a person’s timely cooperation when such cooperation would put the person in potential criminal jeopardy and when alternatives to full immunity (such as testimonial immunity) were “impossible or impracticable.” USAM § 9-27.600 (comment).205 The “cooperation” contemplated was cooperation in the criminal investigation or prosecution of another person. In certain circumstances, government attorneys were required to obtain approval from the appropriate Assistant Attorney General before entering into a non-prosecution agreement in exchange for cooperation. Epstein, however, was not providing “cooperation” as contemplated by the USAM, and the USAM was silent as to whether a prosecutor could use a non-prosecution agreement in circumstances other than in exchange for cooperation in the investigation or prosecution of another. Notably, although the USAM provided guidance and approval requirements in cases involving cooperation, the USAM did not prohibit the use of a non-prosecution agreement in other situations. Accordingly, OPR concludes that the USAM did not establish a clear and unambiguous obligation prohibiting Acosta from ending the federal investigation through a non-prosecution 205 USAM § 9-27.650 required that non-prosecution agreements in exchange for cooperation be fully memorialized in writing. Although this requirement was not applicable for the reasons given above, the NPA complied by fully memorializing the terms of the agreement.

137 agreement that did not require Epstein’s cooperation nor did the USAM require Acosta to obtain Departmental approval before doing so. C. The NPA’s Individual Provisions Did Not Violate Any Clear and Unambiguous Standards Although Acosta, as U.S. Attorney, had discretion generally to resolve the case through a non-prosecution agreement that deferred prosecution to the state, OPR also considered whether a clear and unambiguous standard governed any of the individual provisions of the NPA. Specifically, OPR examined Acosta’s decision to permit Epstein to resolve the federal investigation by pleading guilty to state charges of solicitation of minors to engage in prostitution and solicitation to prostitution, with a joint, binding recommendation for an 18-month sentence of incarceration. Because, as noted above, OPR found no clear guidance applicable to non- prosecution agreements not involving cooperation, OPR examined Departmental policies relating to plea offers to assess the propriety of the NPA’s charge and sentence requirements. OPR also examined the provision declining to prosecute Epstein’s unidentified “potential co-conspirators,” to determine whether that provision violated Departmental policy regarding grants of immunity. Finally, OPR considered whether there was a clear and unambiguous obligation under the Department’s policy regarding the deportation of criminal aliens, which would have required further action to be taken against the two Epstein assistants who were foreign nationals. After considering the applicable rules and policies, OPR finds that Acosta’s decision to resolve the federal investigation through the NPA did not violate any clear and unambiguous standards and that Acosta had the authority to resolve the federal investigation through a state plea and through the terms that he chose. Accordingly, OPR concludes that Acosta did not commit professional misconduct in developing, negotiating, or approving the NPA, nor did the other subjects who implemented his decisions with respect to the resolution.206 1. Acosta Had Authority to Approve an Agreement That Required Epstein to Plead to Offenses Resulting in an 18-Month Term of Incarceration Federal prosecutors have discretion to resolve a pending case or investigation through a plea agreement, including a plea that calls for the imposition of a specific, predetermined sentence. USAM §§ 9-27.330, 9-27.400; see also Federal Rule of Criminal Procedure 11(c)(1). 206 OPR also considered whether Acosta, Sloman, Menchel, Lourie, or Villafaña failed to comply with professional ethics standards requiring that attorneys exercise competence and diligence in their representation of a client. Attorneys have a duty to provide competent, diligent representation to their clients, which generally requires the legal knowledge, skill, thoroughness, and preparation reasonably necessary for the representation. See, e.g., FRPC 4-1.1, 4-1.3. The requirement of diligence obligates an attorney to exercise “zeal” in advocating for the client, but does not require the attorney “to press for every advantage that might be realized for a client.” See FRPC 4-1.3 (comment). Although OPR criticizes certain decisions made during the USAO’s investigation of Epstein, those decisions, even if flawed, did not violate the standard requiring the exercise of competence or diligence. The subjects exhibited sufficient knowledge, skill, preparation, thoroughness, and zeal during the federal investigation and the NPA negotiations to satisfy the general standards established by the professional responsibility rules. An attorney may attain a flawed result but still exercise sufficient competence and diligence throughout the representation to meet the requirements of the standard.

138 Longstanding Department policy directs prosecutors to require the defendant to plead to the most serious readily provable charge consistent with the nature and extent of the defendant’s criminal conduct, that has an adequate factual basis, is likely to result in a sustainable conviction, makes likely the imposition of an appropriate sentence and restitution order, and does not adversely affect the investigation or prosecution of others. See USAM §§ 9-27.430, 9-27-300, 9-27.400 (comment). The genesis of this policy, the Ashcroft Memo, specifically requires federal prosecutors to charge and pursue all readily provable charges that would yield the most substantial sentence under the Sentencing Guidelines. However, the Ashcroft Memo articulates an important exception: a U.S. Attorney or a “designated supervisory attorney” may authorize a plea that does not comport with this policy.207 Moreover, the Ashcroft Memo explains that a charge is not “readily provable” if the prosecutor harbors “a good faith doubt,” based on either the law or the evidence, as to the government’s ability to prove the charge at trial. By its plain terms, the NPA arguably does not appear to satisfy the “most serious readily provable charge” requirement. The draft indictment prepared by Villafaña proposed charging Epstein with a variety of federal crimes relating to sexual conduct with and trafficking of minors, and Epstein’s sentencing exposure under the federal guidelines was in the range of 168 to 210 months’ imprisonment. The original “term sheet” presented to the defense proposed a “non- negotiable” requirement that Epstein plead guilty to three state offenses, in addition to the original state indictment, with a joint, binding recommendation for a two-year term of incarceration. Instead, Epstein was permitted to resolve his federal criminal exposure with a plea to the state indictment and only one additional state offense, and an 18-month sentence. As discussed more fully later in this Report, Acosta, Sloman, Menchel, and Lourie perceived risks to going forward to trial on the federal charges Villafaña outlined in the prosecution memorandum and identified for OPR concerns with both the evidence and legal theories on which a federal prosecution would be premised. On the other hand, Villafaña felt strongly that federal charges should be brought, and the CEOS Chief reviewed the prosecution memorandum and twice opined that the charges were appropriate. OPR found it unnecessary to resolve the question whether federal charges against Epstein were readily provable, however, because Acosta had 207 In addition to specified “Limited Exceptions,” this authorization is available in “Other Exceptional Circumstances,” as follows: Prosecutors may decline to pursue or may dismiss readily provable charges in other exceptional circumstances with the written or otherwise documented approval of an Assistant Attorney General, United States Attorney, or designated supervisory attorney. This exception recognizes that the aims of the Sentencing Reform Act must be sought without ignoring the practical limitations of the federal criminal justice system. For example, a case-specific approval to dismiss charges in a particular case might be given because the United States Attorney’s Office is particularly over-burdened, the duration of the trial would be exceptionally long, and proceeding to trial would significantly reduce the total number of cases disposed of by the office. However, such case-by-case exceptions should be rare; otherwise the goals of fairness and equity will be jeopardized. Ashcroft Memo at § I.B.6. See also USAM §§ 9-2.001 and 27.140 (U.S. Attorneys’ authority to depart from the USAM).

139 authority to deviate from the Ashcroft Memo’s “most serious readily provable offense” requirement. Although Acosta could not recall specifically how or by whom the decision was made to allow Epstein to plead to only one of the three charges identified on the original term sheet, or how or by whom the decision was made to reduce the sentencing requirement from two years to 18 months, Acosta was aware of these changes. He reviewed and approved the final NPA before it was signed. Department policy gave him the discretion to approve the agreement, notwithstanding any arguable failure to comply with the “most serious readily provable offense” requirement. Furthermore, the Ashcroft Memo does not appear to preclude a U.S. Attorney from deferring to a state prosecution, so it is not clear that the Memo’s terms apply to a situation involving state charges. Accordingly, OPR concludes that the negotiation of an agreement that allowed Epstein to resolve the federal investigation in return for the imposition of an 18-month state sentence did not violate a clear and unambiguous standard and therefore does not constitute professional misconduct. 2. The USAO’s Agreement Not to Prosecute Unidentified “Potential Co-Conspirators” Did Not Violate a Clear and Unambiguous Department Policy Several witnesses told OPR that they believed the government’s agreement not to prosecute unidentified “potential co-conspirators” amounted to “transactional immunity,” which the witnesses asserted is prohibited by Department policy. Although “use immunity” protects a witness only against the government’s use of his or her immunized testimony in a prosecution of the witness, and is frequently used by prosecutors, transactional immunity protects a witness from prosecution altogether and is relatively rare. OPR found no policy prohibiting a U.S. Attorney from declining to prosecute third parties or providing transactional immunity. One section of the USAM related to immunity but applied only to the exchange of “use immunity” for the testimony of a witness who has asserted a Fifth Amendment privilege. See USAM § 9-23.100 et seq. Statutory provisions relating to immunity also address the same context. See 18 U.S.C. § 6002; 21 U.S.C. § 884. Moreover, apart from voluntariness or enforceability concerns, courts have not suggested that a prosecutor’s promise not to prosecute a third party amounts to an inappropriate exercise of prosecutorial discretion. See, e.g., Marquez, 909 F.2d at 741-43; Kemp, 760 F.2d at 1248; Stinson, 839 So. 2d at 909; Frazier, 697 So. 2d 945. OPR found no clear and unambiguous standard that was violated by the USAO’s agreement not to prosecute “potential co-conspirators,” and therefore cannot conclude that negotiating or approving this provision violated a clear and unambiguous standard or constituted professional misconduct. Notwithstanding this finding, in Section IV of this Part, OPR includes in its criticism of Acosta’s decision to approve the NPA his approval of this provision without considering its potential consequences, including to whom it would apply.

140 3. The NPA Did Not Violate Department Policy Relating to Deportation of Criminal Aliens During the negotiations, the USAO rejected a defense-offered provision prohibiting the USAO from “request[ing], initiat[ing], or in any way encourag[ing] immigration authorities to institute immigration proceedings” against two female assistants. However, OPR considered whether the April 28, 1995 memorandum imposed any obligation on the USAO to prosecute Epstein’s two female assistants who were known to be foreign nationals—as Villafaña urged in her prosecution memorandum—and thus trigger their removal, or conversely, whether it precluded the USAO from agreeing not to prosecute them as part of a negotiated resolution. OPR found nothing in the policy that created a clear and unambiguous standard in either regard. The Attorney General’s April 28, 1995 memorandum regarding “Deportation of Criminal Aliens” directed federal prosecutors to become involved actively and directly in the process of removing criminal aliens from the United States, and, along with USAM § 9-73.520, provided that “[a]ll deportable criminal aliens should be deported unless extraordinary circumstances exist.” However, Epstein’s two assistants were not “deportable” unless and until convicted of a crime that would have triggered their removal. But neither the policy memorandum nor the USAM imposed an obligation on the USAO to prosecute or secure a conviction against a foreign national nor did either provision preclude the USAO from declining to prosecute an alien using the same broad discretion that otherwise applies to charging decisions. The policy guidance also requires “prompt and close coordination” with immigration officials in cases involving alien defendants and specifies that prosecutors must notify immigration authorities before engaging in plea negotiations with alien defendants. OPR learned during its investigation that an ICE agent participated in the Epstein investigation in its early stages. Moreover, because the USAO never engaged in plea negotiations with the two female assistants, who, in any event, had not been charged and were therefore not “defendants,” no further notification was required. IV. THE EVIDENCE DOES NOT ESTABLISH THAT THE SUBJECTS WERE INFLUENCED BY IMPROPER MOTIVES TO INCLUDE IN THE NPA TERMS FAVORABLE TO EPSTEIN OR TO OTHERWISE EXTEND BENEFITS TO EPSTEIN OPR investigated whether any of the subjects—Acosta, Sloman, Menchel, Lourie, or Villafaña—was influenced by corruption, bias, or other improper motive, such as Epstein’s wealth, status, or political associations, to include terms in the NPA that were favorable to Epstein, or whether such motives otherwise affected the outcome of the federal investigation. OPR considered the case-specific reasons the subjects identified as the motivation for the USAO’s July 31, 2007 “term sheet” and Acosta’s approval of the NPA in September 2007. OPR also thoroughly examined various factors forming the basis for allegations that the subjects were motivated by improper influences, including the subjects’ preexisting relationships with defense counsel; the subjects’ numerous meetings with Epstein’s team of nationally known attorneys; emails between the subjects—particularly Villafaña—and defense counsel that appeared friendly, casual, and deferential to defense counsel; and inclusion in the NPA of a broad provision declining

141 to prosecute all of Epstein’s co-conspirators. These factors are analyzed in the following discussions throughout this Section of the Report. As a threshold matter, OPR’s investigation of the subjects’ decisions and actions in the Epstein matter uncovered no evidence of corruption such as bribery, gratuity, or illegal political or personal consideration. In addition, OPR examined the extensive contemporaneous documentary record, interviewed witnesses, and questioned the subject attorneys. The evidence shows three sets of issues influenced Acosta’s decision to resolve the case through the NPA. The first—of main concern to Acosta—involved considerations of federalism and deference to state authority. The second arose from an assessment by Acosta’s senior advisers—Sloman, Menchel, and Lourie—that the case carried substantial litigation risks, including both witness issues and what some viewed as a novel application of certain federal statutes to the facts of the Epstein case.208 The third was Acosta’s aim of obtaining a greater measure of justice for victims of Epstein’s conduct and for the community than that proposed by the state. Although the NPA and the process for reaching it can be criticized, as OPR does, OPR did not find evidence supporting a conclusion that the subjects were motivated by a desire to benefit Epstein for personal gain or because of other improper considerations, such as Epstein’s wealth, status, or associations. That is not to say that Epstein received no benefit from his enormous wealth. He was able to hire nationally known attorneys who had prestige, skill, and extensive experience in federal and state criminal law and in conducting negotiations. He had the resources to finance an aggressive approach to the case that included the preparation of multiple written submissions reflecting extensive research and analysis, as well as multiple in-person meetings involving several of his attorneys and USAO personnel. He assembled a defense team well versed in the USAO and the Department, with the knowledge to maneuver through the Department’s various levels and offices, a process unknown to many criminal defense attorneys and infrequently used even by those familiar with the Department’s hierarchy. Access to highly skilled and prominent attorneys is not unusual in criminal cases involving corporations and their officers or certain other white collar defendants, but it is not so typical for defendants charged with sex crimes or violent offenses. Nonetheless, while recognizing that Epstein’s wealth played a role in the outcome because he was able to hire skilled and assertive attorneys, OPR concludes that the subjects were not motivated to resolve the federal investigation to Epstein’s benefit by improper factors. A. OPR Found No Evidence of Criminal Corruption, Such as Bribery, Gratuity, or Illegal Political or Personal Consideration Some public criticism of the USAO’s handling of the Epstein matter implied that the subjects’ decisions or actions may have been motivated by criminal corruption, although no specific information substantiating such implications was identified. Throughout its investigation, 208 Sloman asserted throughout his OPR interview that he did not participate in substantive discussions about the Epstein investigation before the NPA was signed, and his attorney argued in his comments on OPR’s draft report that OPR should not attribute to Sloman any input in Acosta’s decisions about how to resolve the case. However, Sloman was included in numerous emails discussing the merits of and issues relating to the investigation, participated in meetings with the defense team, and, according to Acosta, was one of the senior managers whom Acosta consulted in determining how to resolve the Epstein investigation.

142 OPR was attentive to any evidence that any of the subjects was motivated by bribes, gratuities, or other illegal political or personal considerations, and found no such indication.209 Witnesses, including law enforcement officials, were specifically asked whether they had any information indicating such corruption, and all—notwithstanding the harsh criticism by some of those same witnesses of the Epstein matter’s outcome—stated that they did not. Specifically, the FBI case agent told OPR that she did not believe there had been any illegal influence, and that if she had perceived any, she “would have gone screaming” to the FBI’s public corruption unit. The co-case agent and the FBI supervisors up through the Special Agent in Charge likewise told OPR that they were unaware of any indication that a prosecutor acted in the matter because of illegal factors such as a gratuity or bribe or other corrupt influence, and that any such indication would immediately have been referred for criminal investigation by the FBI. B. Contemporaneous Written Records and Witness and Subject Interviews Did Not Reveal Evidence Establishing That the Subjects Were Improperly Influenced by Epstein’s Status, Wealth, or Associations Although Epstein’s name is now nationally recognized, in 2006 and 2007, he was not a familiar national figure or even particularly well known in Florida. All five subjects told OPR that when they first learned of the investigation, they had not heard of Epstein. Similarly, the FBI case agent told OPR that when the investigation began, no one in the FBI appeared to have heard of Epstein, and other witnesses also told OPR that they were initially unfamiliar with Epstein. However, news reports about Epstein’s July 2006 arrest on the state indictment, which were contemporaneous with the beginning of the federal investigation, identified him as a wealthy Palm Beach resident with influential contacts, including William Clinton, Donald Trump, Kevin Spacey, and Alan Dershowitz, and other “prominent businessmen, academics and scientists.”210 Villafaña, Lourie, Sloman, and Acosta learned of this press coverage early in the investigation, and thus understood that Epstein was wealthy and associated with notable public figures.211 The FBI case agent also told OPR that “we knew who had been on his plane, we knew . . . some of his connections.” 1. The Contemporaneous Records Did Not Reveal Evidence Establishing That the NPA Resulted from Improper Factors OPR found no evidence in the extensive contemporaneous documentary record that the terms of the NPA resulted from improper factors, such as Epstein’s wealth or influential connections. Epstein’s legal team overtly raised Epstein’s financial status in arguing for a sentence that did not include a term of imprisonment on the ground that Epstein would be extorted in prison, but the USAO insisted that Epstein serve a term of incarceration. Defense counsel mentioned former President Clinton in one pre-NPA letter, but that reference was made in the context of a 209 OPR’s jurisdiction does not extend to the investigation of allegations of criminal activity. If OPR had found indication of criminal activity, it would have referred the matter to the appropriate Department investigative agencies. 210 Larry Keller, “Billionaire solicited prostitutes three times, indictment says,” Palm Beach Post, July 24, 2006; Nicole Janok, “Consultant to the rich indicted, jailed,” Palm Beach Post, July 24, 2006. 211 Lourie later made Menchel aware of Epstein’s prominence in the course of forwarding to Menchel the initial prosecution memorandum.

143 narrative of Epstein’s philanthropic activities, rather than presented as a suggestion that Epstein’s association to the former President warranted leniency and, in any case, the USAO rejected the defense argument that the matter should be left entirely to the state’s discretion.212 The defense submission to the Deputy Attorney General contained a direct reference to Epstein’s connection to former President Clinton, but that submission was made well after the NPA was negotiated and signed, and in it, counsel contended that the USAO had treated Epstein too harshly because of his association with the former President.213 2. The Subjects Asserted That They Were Motivated by Reasonable Strategic and Policy Considerations, Not Improper Influences In addition to reviewing the documentary evidence, OPR questioned the five subject attorneys, all of whom denied being personally influenced by Epstein’s wealth or status in making decisions regarding the investigation, in the decision to resolve the case through an NPA, or in negotiating the NPA. Villafaña, in particular, was concerned from the outset of the federal investigation that Epstein might try to employ against the USAO the same pressure that she understood had been used with the State Attorney’s Office, and she proactively took steps to counter Epstein’s possible influence by meeting with Acosta and Sloman to sensitize them to Epstein’s tactics. Both Acosta and Sloman told OPR that the USAO had handled cases involving wealthy, high-profile defendants before, including the Abramoff case. Acosta told OPR, “[W]e tried to treat [the case] fairly, not looking at . . . how wealthy is he, but also not saying we need to do this because he is so wealthy.” Menchel expressed a similar view, telling OPR that he did not believe “it’s appropriate to go after somebody because of their status one way or the other.” Lourie told OPR that Epstein’s status may have generated more “front office” involvement in the case, but it did not affect the outcome, and Sloman “emphatically disagree[d]” with the suggestion that the USAO’s handling of the case had been affected by Epstein’s wealth or influential connections. Other witnesses corroborated the subjects’ testimony on this point, including the FBI case agents, who told OPR that no one ever communicated to them that they should treat Epstein differently because of his wealth. The CEOS Chief told OPR that he did not recall anyone at the USAO expressing either qualms or enthusiasm about proceeding against Epstein because of his wealth and influence. OPR takes note of but does not consider dispositive the absence of any affirmative evidence that the subjects were acting from improper motivations or their denial of such motivations. Of more significance, and as discussed more fully below, was the fact that contemporaneous records support the subjects’ assertions that the decision to pursue a pre-charge resolution was based on various case-specific legal and factual considerations.214 OPR also 212 In the pre-NPA letter to the USAO, counsel recited a litany of Epstein’s purported good deeds and charitable works, including a trip Epstein took to Africa with former President Clinton to raise awareness of AIDS, and counsel also noted that the former President had been quoted by New York Magazine describing Epstein as “a committed philanthropist.” 213 In the letter to the Deputy Attorney General, counsel suggested that the prosecution may have been “politically motivated” due to Epstein’s “close personal association with former President Bill Clinton.” 214 OPR also considered that all five subjects provided generally consistent explanations regarding the factors that influenced Acosta’s decision to resolve the federal investigation through the NPA. Sloman, Menchel, Lourie, and Villafaña all had long careers with the Department, and OPR considers it unlikely that they would all have joined with

144 considered that the USAO’s most pivotal decisions—to resolve the case through an NPA requiring Epstein to serve time in jail, register as a sexual offender, and provide monetary damages to victims—had been made by July 31, 2007, when the USAO presented its “term sheet” to the defense. This was before Acosta had ever met with defense counsel and when he had not indicated any plans to do so. It also was well before Acosta’s October 12, 2007 breakfast meeting with defense counsel Lefkowitz, which received strong public and media criticism. OPR also considered significant the fact that although the USAO made numerous concessions in the course of negotiating the final NPA, the USAO did not accede to the defense request that the USAO end federal involvement altogether and return the matter to the state authorities to handle as they saw fit, and the USAO refused to eliminate its requirement that Epstein register as a sexual offender, despite a strong push by the defense that it do so. 3. Subject and Witness Interviews and Contemporaneous Records Identified Case-Specific Considerations Relating to Evidence, Legal Theories, Litigation Risk, and a Trial’s Potential Impact on Victims Acosta, Sloman, Menchel, and Lourie told OPR that they did not recall the specific content of discussions about the challenges presented by a potential federal prosecution or reasons for Acosta’s decision to resolve the federal investigation through the NPA, but they and Villafaña identified for OPR several case-specific factors, unrelated to Epstein’s wealth or associations, that either did or likely would have been included in those discussions and that OPR concludes likely influenced Acosta’s decision-making. These considerations included assessment of the evidentiary risks and the potential impact of a trial on the victims. For the most part, however, these factors appear more aptly to pertain to the decision to resolve the case through a pre-charge disposition, but do not directly explain why Acosta chose to resolve the federal investigation through a guilty plea in state court. That decision appears to have stemmed from Acosta’s concerns about intruding into an area he believed was traditionally handled by state law enforcement authorities. In a declaration submitted to the district court in 2017 in connection with the CVRA litigation, Villafaña explained the USAO’s rationale for terminating the federal investigation through the NPA: Prior to the Office making its decision to direct me to engage in negotiations with Epstein’s counsel, I discussed the strengths and weaknesses of the case with members of the Office’s management, and informed them that most of the victims had expressed significant concerns about having their identities disclosed. . . . It is my understanding from these and other discussions that these factors, that is, the various strengths and weaknesses of the case and the various competing interests of the many different victims (including the privacy concerns expressed by many), together with the Office’s desire to obtain a guaranteed sentence of incarceration for Epstein, the equivalent of uncontested restitution for the victims, Acosta to improperly benefit Epstein or would have remained silent if they suspected that Acosta, or any of their colleagues, was motivated by improper influences.

145 and guaranteed sexual offender registration by Epstein . . . were among the factors [that led to the NPA].215 During her OPR interview, Villafaña similarly described the victims’ general reluctance to go forward with a trial: [W]hen we would meet with victims, we would ask them how they wanted the case to be resolved. And most of them wanted the case to be resolved via a plea. Some of them wanted him not to be prosecuted at all. Most of them did not want to have to come to court and testify. They were very worried about their privacy rights.216 In his written response to OPR, Lourie stated that although he did not specifically recall the issues Villafaña set forth in her declaration, he believed they would have been important to the USAO in 2007. Lourie also told OPR that he generally recalled concerns within the USAO about the charges and a potential trial: [M]y vague recollection is that I and others had concerns that there was a substantial chance we would not prevail at both trial and on appeal after a conviction, resulting in no jail time, no criminal 215 Doe v. United States, No. 9:08-cv-80736 (S.D. Fla.), Declaration of A. Marie Villafaña in Support of Government’s Response and Opposition to Petitioners’ Motion for Partial Summary Judgment and Cross-Motion for Summary Judgment at 8-9 (June 2, 2017). 216 These concerns are also reflected in a 2017 declaration filed by the FBI case agent in the CVRA litigation, in which she stated, “During interviews conducted from 2006 to 2008, no victims expressed a strong opinion that Epstein be prosecuted.” She further described the concerns of some of the victims: Throughout the investigation, we interviewed many [of Epstein’s] victims . . . . A majority of the victims expressed concern about the possible disclosure of their identities to the public. A number of the victims raised concerns about having to testify and/or their parents finding out about their involvement with Mr. Epstein. Additionally, for some victims, learning of the Epstein investigation and possible exposure of their identities caused them emotional distress. Overall, many of the victims were troubled about the existence of the investigation. They displayed feelings of embarrassment and humiliation and were reluctant to talk to investigators. Some victims who were identified through the investigation refused even to speak to us. Our concerns about the victims’ well-being and getting to the truth were always at the forefront of our handling of the investigation. In addition, during the CVRA litigation, an attorney representing several victims filed a pleading to protect the anonymity of his clients by preventing disclosure of their identities to the CVRA petitioners. See Response to Court Order of July 6, 2015 and United States’ Notice of Partial Compliance (July 24, 2015). It is noteworthy that in 2020, when OPR attempted to contact victims, through their counsel, for interviews or responses to written questions regarding contacts with the USAO, OPR was informed that most of the victims were still deeply concerned about remaining anonymous. One victim described to OPR how she became distraught when, during the USAO’s investigation, the FBI left a business card at her parents’ home and, as a result, her parents learned that she was a victim of Epstein. At the time, the victim was a teenager; was “nervous, scared, and ashamed”; and did not want her parents to know about the case.

146 record, no restitution, no sex offender status, publication at a trial of the names of certain victims that didn’t want their names revealed and the general difficulties of a trial for the victims and their families. Although his emails showed that, at the time, he advocated for prosecution of Epstein, Lourie told OPR it was also his general recollection that “everybody at the USAO working on the matter had expressed concerns at various times about the long-term viability of a federal prosecution of Epstein due to certain factual and legal hurdles, as well as issues with the cooperation and desires of the victims.” Similarly, Menchel—who had experience prosecuting sexual assault crimes—recalled understanding that many of the victims were unwilling to go forward and would have experienced additional trauma as a result of a trial, and some had made statements exonerating Epstein. Menchel told OPR he believed that if the USAO had filed the proposed charges against Epstein, Epstein would have elected to go to trial. In Menchel’s view, the USAO therefore had to weigh the risk of losing at trial, and thereby re-traumatizing the victims, against the benefits gained through a negotiated result, which ensured that Epstein served time in jail, registered as a sexual offender, and made restitution to his victims. Sloman also recalled witness challenges and concerns about the viability of the government’s legal theories. He told OPR: [I]t seemed to me you had a tranche of witnesses who were not going to be reliable. You had a tranche [of] witnesses who were going to be severely impeached. People who loved Jeffrey Epstein who thought he was a Svengali . . . who were going to say I told him I was 18 years old. You had witnesses who were scared to death of the public light being shown on them because their parents didn’t even know -- had very vulnerable victims. You had all of these concerns. Acosta told OPR that he recalled discussions with his senior managers about the victims’ general credibility and reluctance to testify and the evidentiary strength of the case, all of which factored into the resolution. He acknowledged that his understanding of the facts was not “granular” and did not encompass a detailed understanding of each victim’s expected testimony, but he trusted that his “team” had already “done the diligence necessary” to make recommendations about the evidentiary strength of the case. Acosta recalled discussing the facts with Sloman and Menchel, and possibly Lourie, none of whom had as detailed an understanding of the facts as Villafaña. Nevertheless, OPR credits Acosta’s statement that he reasonably believed, based on his conversations with others who expressed this view, that a trial would pose significant evidentiary challenges. Other witnesses corroborated the subjects’ testimony regarding witness challenges, including the FBI co-case agent, who recalled during his OPR interview that some of the victims had expressed concern for their safety and “a lot of them d[id]n’t want to take the stand, and

147 d[id]n’t want to have to relive what happened to them.”217 The co-case agent told OPR that one of the “strategies” for dealing with the victims’ fear was “to keep them off the stand,” and he generally remembered discussions about resolving the Epstein case in a way that protected the victims’ identities. In addition, the CEOS Trial Attorney who briefly worked with Villafaña on the case after the NPA was signed told OPR that in her meetings with some of the victims, she formed the impression that they were not interested in the prosecution going forward. The CEOS Trial Attorney told OPR that “[the victims] would have testified,” but would have required an extensive amount of “victim management” because they were “deeply embarrassed” about potentially being labeled as prostitutes. The CEOS Trial Attorney also told OPR that “there were obvious weaknesses in the case,” from an evidentiary perspective.218 The contemporaneous records also reflect discussions of, or references to, various legal and factual issues or other concerns about the case. For example, in an early email to Menchel, Lourie noted that two key issues raised by Villafaña’s proposed charges were whether the USAO could prove that Epstein traveled for the purpose of engaging in sex acts, and the fact that some minor victims had told Epstein they were 18. He later opined to Acosta and Menchel that “there is some risk on some of the statutes [proposed in Villafaña’s prosecution memorandum] as this is uncharted territory to some degree.” In his July 5, 2007 email to Villafaña, Menchel cited Acosta’s and Sloman’s “concerns about taking this case because of [the P]etit policy and a number of legal issues” and Acosta’s concerns about “hurting Project Safe Childhood.” Defense counsel raised myriad legal and factual challenges in their voluminous letters to the USAO. Defense submissions attacked the legal theories for a federal prosecution and detailed factors that could have undermined victims’ credibility, including victim statements favorable to Epstein and evidence of victim drug and alcohol use, as well as the fact that some victims recruited other victims and purportedly lied to Epstein about their ages. Acosta also recalled that although his “team” had expressed concern about the “trial issues,” his own focus had been on “the legal side of things.” Notably, during his prior tenure as the Assistant Attorney General in charge of the Department’s Civil Rights Division, Acosta had been involved in efforts to address sex trafficking. He told OPR that one of the “background issues” that the Civil Rights Division addressed under his leadership, and which influenced his view of the Epstein case, was the distinction between sex trafficking and solicitation of prostitution. Specifically, he was concerned about avoiding the creation of potentially unfavorable federal precedent on the point of delineation between prostitution, which was traditionally a matter of state concern, and sex trafficking, which remained a developing area of federal interest in 2007.219 217 In an affidavit filed in the CVRA litigation, the co-case agent noted that in early 2007, when he located a victim living outside of the United States, she claimed only to “know Jeffrey Epstein,” and stated that she “moved away to distance herself from this situation,” and “asked that [the agent] not bother her with this again.” 218 In April 2007, a victim who was represented by an attorney paid by Epstein participated in a video-recorded interview with the FBI, with her attorney and his investigator present. This victim denied being involved in, or being a victim of, criminal activity. Later, the victim obtained new counsel and joined the CVRA litigation as “Jane Doe #2.” 219 In his March 20, 2011 letter, addressed “To whom it may concern,” and published online in The Daily Beast, Acosta described “a year-long assault on the prosecution and the prosecutors” by “an army of legal superstars.” Most of the allegations made against the prosecutors occurred after the NPA was signed and certainly after Acosta approved

148 The USAO might have been able to surmount the evidentiary, legal, and policy issues presented by a federal prosecution of Epstein. Villafaña, in particular, believed she could have prevailed had she taken the case to trial, and even after the NPA was negotiated, she repeatedly recommended declaring Epstein in breach and proceeding with an indictment, because she continued to have confidence in the case.220 Oosterbaan and others also believed that the government would succeed at trial. Furthermore, the victims were not a uniform group. Some of them were afraid of testifying or having their identities made public; others wanted Epstein prosecuted, but even among those, it is not clear how many expressed a willingness to testify at a trial; and still others provided information favorable to Epstein. In the end, Acosta assumed responsibility for deciding how to resolve the Epstein investigation and weighing the risks and benefits of a trial versus those of a pre-charge disposition. His determination that a pre-charge disposition was appropriate was not unreasonable under the circumstances. Although evidentiary and witness issues explain the subject supervisors’ concerns about winning a potential trial and why the USAO would have sought some sort of pre-charge disposition, they do not fully explain why Acosta decided to pursue a state-based resolution as opposed to a traditional federal plea agreement. OPR did not find in the contemporaneous records a memorandum or other memorialization of the reasoning underlying Acosta’s decision to offer a state-based resolution or the terms offered to the defense on July 31, 2007. According to Acosta, “In 2006, it would have been extremely unusual for any United States Attorney’s Office to become involved in a state solicitation case, even one involving underage teens,” because solicitation was “the province of state prosecutors.” Acosta told OPR that he developed “a preference for deferring to the state” to “make it clear that [the USAO was] not stepping on something that is a purely local matter, because we [didn’t] want bad precedent for the sake of the larger human trafficking issue.” Acosta also told OPR that it was his understanding that the PBPD would not have brought the case to federal investigators if the State Attorney’s Office had pursued a sanction against Epstein that included jail time and sexual offender registration. Acosta viewed the USAO’s role in the case as limited to preventing the “manifest injustice” that, in Acosta’s view, would have resulted from the state’s original plea proposal. Acosta acknowledged that if the investigation had begun in the federal system, he would not have viewed the terms set out in the NPA as a satisfactory result, but it was adequate to serve as a “backstop” to the state’s prosecution, which he described as “a polite way of saying[, ‘]encouraging the state to do a little bit more.[’]” In sum, Acosta told OPR that the Epstein case lay in “uncharted territory,” there was no certainty that the USAO would prevail if it went to trial, and a potentially unfavorable outcome had to be “weighed against a certain plea with registration that would make sure that the public knew that this person was a sex offender.” Acosta told OPR that he discussed the case primarily with Sloman and Menchel, and both told OPR that while they did not share Acosta’s federalism concerns, they recalled that Acosta had the terms offered to the defense on July 31, 2007. Therefore, any allegations against the prosecutors could not have played a significant role in Acosta’s decisions as reflected in the term sheet. 220 Sloman told OPR that Villafaña “always believed in the case.”

149 been concerned about policy and federalism issues.221 Sloman told OPR that although he did not remember specific conversations, he generally recalled that Acosta had been “sensitive to” Petite policy and federalism concerns, which Sloman described as whether the USAO was “overstepping our bounds by taking what is a traditional state case that was in the State Attorney’s Office that was resolved by the State Attorney’s Office at some level.” During his OPR interview, Menchel remembered that Acosta approached the case from “a broader policy perspective” and was worried about “the impact that taking the case in federally may have on . . . other programs,” although Menchel did not recall specifically what those programs were. C. Other Significant Factors Are Inconsistent with a Conclusion That the Subjects’ Actions Were Motivated by Improper Influences OPR considered additional aspects of the Epstein case that were inconsistent with a suggestion that Acosta’s decision to offer the July 31, 2007 terms was driven by corruption, a desire to provide an improper benefit to Epstein, or other improper influences. First, OPR considered highly significant the fact that if Acosta’s primary motivation was to benefit Epstein, he had an option even more favorable to Epstein available to him. The NPA required Epstein to serve time in jail and register as a sexual offender, and provided a mechanism for the victims to seek monetary damages—outcomes unlikely if the matter had been abandoned and sent back to the state for whatever result state authorities deemed appropriate. Epstein’s attorneys had vehemently argued to the USAO that there was no federal interest in the investigation and that his conduct was exclusively a matter of state concern. If the USAO had declined to intervene in the case, as Epstein’s counsel repeatedly and strongly argued it should, the state would have meted out the sole punishment for his behavior. Under the state’s original plan, Epstein likely would have received a sentence of probation. Menchel described such a result as a mere “slap on the wrist,” with “no jail time, no felony sex offense, no sexual offender registration, [and] no restitution for the victims.” Instead of acceding to Epstein’s proposal, however, the USAO devised a resolution of the federal investigation that, although widely criticized as inadequate to address the seriousness of Epstein’s conduct, nevertheless penalized Epstein more than a guilty plea to the state’s original charge, standing alone, would have done. Acosta’s affirmative decision to intervene and to compel a more stringent and just resolution than the state had proposed, rather than exercising his discretion to quietly decline prosecution, is strong circumstantial evidence that he was not acting for the purpose of benefiting Epstein.222 Similarly, despite defense counsel’s repeated requests to eliminate the sexual offender registration requirement, Acosta refused to 221 Sloman stated that although Acosta “was sensitive to [P]etite policy concerns, federalism concerns, . . . I was not.” Menchel commented, “I don’t think it would have been a concern of mine.” 222 Menchel also pointed out during his OPR interview that Acosta was Republican and “had nothing to gain” by showing favoritism to Epstein, who had been portrayed in the media as “this big Democratic donor.” Villafaña recounted for OPR an exchange between the USAO team and a defense attorney who argued in one meeting that— we were prosecuting [Epstein] because he was Jewish. We then pointed out that a number of members of [the USAO] chain of command were Jewish. Then he said, well we’re prosecuting him because he was a Democrat. And again, we pointed out that a number of us were Democrats. So then it went to, we were prosecuting him because he was wealthy. . . . That one didn’t work so well.

150 reconsider the provision. Acosta could certainly have modified or eliminated the provision entirely if his motivation was to benefit Epstein or Epstein’s attorneys. Second, Epstein himself was not satisfied with the NPA. Immediately after signing the agreement, he sought to have the Department nullify it by declaring federal involvement in the investigation inappropriate. In addition to repeatedly attacking the NPA in his submissions to the Department, Epstein added to his evidentiary challenges and federalism claims allegations of misconduct and improper bias on the part of specific USAO personnel. Epstein’s dissatisfaction with the NPA, and his personal attacks on individual prosecutors involved in negotiating the agreement, appear inconsistent with a conclusion that the subjects designed the NPA for Epstein’s benefit. D. OPR Does Not Find That the Subjects’ Preexisting Relationships with Defense Counsel, Decisions to Meet with Defense Counsel, and Other Factors Established That the Subjects Acted from Improper Influences or Provided Improper Benefits to Epstein In evaluating the subjects’ conduct, OPR considered various other factors featured in media accounts to show that the subjects provided improper benefits to Epstein or which purportedly suggested that the subjects acted from improper influences. OPR examined these factors but did not find that they supported a finding that the subjects were influenced by favoritism, bias, or other improper motivation. 1. The Evidence Does Not Establish That the Subjects Extended Any Improper Benefit to Epstein because of Their Preexisting Relationships with His Attorneys Epstein’s wealth enabled him to hire multiple attorneys who had preexisting personal connections to some of the government attorneys involved in his case, in the State Attorney’s Office, in the USAO, and elsewhere in the Department. Based on the attorneys Epstein selected to represent him, a reasonable inference can be drawn that Epstein believed that hiring attorneys with relationships to the prosecutors would be beneficial to him. One of the first attorneys who contacted the USAO on Epstein’s behalf was Guy Lewis, a former AUSA in and U.S. Attorney for the Southern District of Florida. Villafaña and Lourie had worked for Lewis, and Lourie was close friends with one of Lewis’s law partners. Epstein also retained Lilly Ann Sanchez, a former AUSA who had been Menchel’s deputy and with whom he had socialized. Later, when Epstein was seeking Acosta’s personal involvement in the case, Epstein hired Kenneth Starr and Jay Lefkowitz, prominent attorneys from Kirkland & Ellis with whom Acosta was acquainted from his previous employment with that firm. Villafaña told OPR that she believed Acosta “was influenced by the stature of Epstein’s attorneys.” Critically, however, other than the information regarding Menchel that is discussed in the following subsection, neither Villafaña nor any of the other individuals OPR interviewed identified any specific evidence suggesting that Acosta, or any of the other subjects, extended an improper favor or benefit to Epstein because of a personal relationship with defense counsel (or for any other improper reason). Villafaña explained how, in her view, the “legal prowess” of Epstein’s attorneys had an impact on the case:

151 [O]ne of the issues in the case was the . . . defense’s ability to describe the case or characterize the case as being legally complex. It was not as legally complex as they made it out to be. But because they were able to convince members of our office that it was somehow extremely novel and legally complex, the issue became who was likely to succeed in arguing these legal issues. And because of that, the legal prowess, if you will, of the attorneys [ ] [became] something to consider. . . . . I think that the ability of Alan Dershowitz and Ken Starr and Jay Lefkowitz to convince Alex Acosta that I didn’t know what I was talking [about] also, all came into play. So I think there were a number of factors and it all came together. Although Villafaña was critical of Acosta’s consideration of the defense arguments, she conceded that the defense team’s tactics demonstrated effective advocacy. Certainly, throughout the case, Epstein’s attorneys prepared lengthy memoranda analyzing the evidence and arguing nuanced legal points concerning federalism, the elements of numerous federal criminal statutes, and the evidence relevant to those statutes, but it is not unusual or unreasonable for prosecutors to carefully consider well-crafted legal arguments from defense counsel. There is little question that Epstein’s extensive team of attorneys was able to obtain negotiated benefits for Epstein—although the USAO never wavered from its three core requirements, it did agree to a reduction in prison time from its original offer, and it granted Epstein certain other concessions during the negotiations. Epstein’s wealth provided him with skilled, experienced negotiators who continually sought various incremental concessions, and with attorneys who knew how to obtain Department review of a USAO matter, thereby delaying undesired outcomes for as long as possible.223 Despite Epstein’s evident intentions, however, OPR did not find evidence warranting a conclusion that the NPA or its terms resulted from the subjects’ relationships with the attorneys he had selected to represent him. 2. The Subjects Asserted That Their Relationships with Defense Counsel Did Not Influence Their Actions Acosta, Menchel, Sloman, and Lourie each asserted that Epstein’s choice of counsel did not affect his handling of the case. Menchel told OPR that once in private practice, former colleagues often became adversaries. In Menchel’s view, such preexisting relationships were useful because they afforded a defense attorney initial credibility and an insight into the issues a prosecutor would likely view as areas of concern, which enabled the defense attorney to “tailor” arguments in a way that would maximize their persuasive impact on the USAO. Menchel told OPR, however, that these advantages did not “move the needle in any major way,” and he “reject[ed] the notion” that anyone in the USAO had been “swayed” because of preexisting 223 As Chief Reiter later observed in his deposition testimony, “[T]he Epstein case was an instance of a many million dollars defense and what it can accomplish.”

152 friendships or associations with any of Epstein’s attorneys. In fact, Menchel told OPR that he and his USAO colleagues viewed Epstein’s attempt to exert influence through his choice of counsel as “ham-fisted” and “clumsy.” Sloman told OPR that although he became aware that Lourie was friends with Guy Lewis and Lewis’s law partner, he was unaware of personal relationships between any of his other colleagues and any of Epstein’s attorneys, but that in any event his attitude regarding cases involving former colleagues “was that we would give them process, but we didn’t pull any punches with them.” In Sloman’s view, preexisting relationships with defense counsel did not “change the equation” because as AUSAs, he and his colleagues were motivated by what they perceived to be best for the case. Lourie told OPR that his preexisting associations with Epstein’s attorneys “didn’t influence anything.” Notably, at the outset of the Epstein case, Lourie sought guidance from the USAO’s Professional Responsibility Officer about the propriety of his role as a supervisor in the investigation, because of his acquaintance with Lewis and long-time friendship with Lewis’s law partner. OPR considered Lourie’s caution in seeking and obtaining the Professional Responsibility Officer’s advice as an indication that he was alert to his ethical responsibilities regarding relationships with defense counsel, including avoiding the appearance of a conflict of interest. Acosta said during his OPR interview that he “developed” the three criteria reflected on the term sheet—a sentence of incarceration, sexual offender registration, and monetary damages for the victims—before he engaged directly with any of Epstein’s attorneys and before Epstein added Starr and Lefkowitz, the Kirkland & Ellis attorneys, to his team. Acosta pointed out that the USAO continued to insist on a resolution that satisfied all three of those criteria even after Kirkland & Ellis became involved in the case. Acosta took other actions that appear inconsistent with an intent to benefit Starr and Lefkowitz. On several occasions, when directly appealed to by Lefkowitz or Starr, he directed them to address their communications to Villafaña, Sloman, and other subordinates. After his October 12, 2007 breakfast meeting with Lefkowitz, Acosta immediately communicated with Sloman about their conversation. In late 2008, when Acosta anticipated leaving the USAO and was considering pursuing employment with Kirkland & Ellis, he recognized the conflict of interest and instructed Sloman to stop copying him on emails relating to the Epstein matter. On Acosta’s behalf, the USAO’s Professional Responsibility Officer sought and obtained formal Department approval of Acosta’s recusal from the case based on the fact that he had “begun to discuss possible employment” with Kirkland & Ellis. These actions support Acosta’s assertion that he was cognizant of his ethical responsibilities concerning relationships with defense counsel.224 224 In addition, in May 2008, the USAO’s Professional Responsibility Officer consulted with the Department’s Professional Responsibility Officer about whether Acosta should recuse from the Epstein matter because he was considering seeking a visiting professorship at Harvard Law School in 2009, and Dershowitz—a Harvard Law School professor—was representing Epstein “as a private, paying client, and not as any part of a Harvard Law School clinic or law school teaching program” and “should have no role in deciding whether Mr. Acosta is offered any position as a visiting professor.” The Department advised that these facts provided no basis for recusal.

153 In its review of the documentary record, OPR examined an email written by Villafaña in 2018, more than a decade after the NPA was negotiated, in which she suggested that the two-year sentence requirement in the initial “term sheet” provided to the defense was developed by Menchel as a favor to defense attorney Sanchez. OPR examined the facts surrounding this allegation and determined that there was no merit to it. Specifically, in December 2018, after the Miami Herald investigative report renewed public attention to the case, Villafaña recounted in an email to a supervisory AUSA, a conversation she recalled having had with Sloman about the case.225 In the email, Villafaña stated that she had not been a participant in discussions that led to Acosta’s decision to offer a two-year plea deal, but she added the following: “Months (or possibly years) later, I asked former First Assistant Jeff Sloman where the two-year figure came from. He said that Lily [sic] Ann Sanchez (attorney for Epstein) asked Mr. Menchel to ‘do her a solid’ and convince Mr. Acosta to offer two years.” OPR questioned both Villafaña and Sloman about the purported “do her a solid” remark. Villafaña told OPR that she had been aware that Menchel and Sanchez were friends. During her OPR interview, Villafaña explained: [A] lot later, I asked Jeff. I said, you know, “Jeff, where did this two years come from?” And he said, “Well, I always figured that . . . Lilly asked Matt to do her a solid,” which I thought was such a strange term, . . . “and to get her a good deal so that she would be in Epstein’s good graces” and that that’s where the two years came from. Although strangely enough, then several years after that, Jeff Sloman asked me where the two years came from, and I had to remind him of that conversation. So Jeff doesn’t know where the two years came from. Because the email had been expressed in more definitive terms, OPR asked Villafaña whether Sloman had affirmatively asserted that the two-year deal was a favor from Menchel to defense counsel, or whether he had stated that he merely “figured” that was the case, but Villafaña could not recall precisely what Sloman had said. At a follow-up interview, Villafaña again said that she was unable to recall whether Sloman’s specific statement was “Lilly asked Matt to do her a solid, and he did it,” or “I always figured Matt just wanted . . . to do her a solid.” Villafaña stated that she was unaware of any information that “expressly [indicated] that there was any sort of exchange of . . . a favor in either direction.” During his OPR interview, Sloman did not recall making such a remark, although he could not rule out the possibility that Villafaña, for whom he repeatedly expressed great respect, “heard that in some fashion.” He told OPR that if he did say something to Villafaña about Menchel having done “a solid” for Epstein’s counsel, he could not have meant it seriously, and he explained, “[I]t’s not something that I would have believed. Him doing her a solid. I mean that’s the furthest thing from my recollection or impression even after years later.” 225 Villafaña’s email stemmed from a congressional inquiry received by the Department concerning the Epstein investigation and the NPA, to which the USAO had been asked to assist in responding. In her email, Villafaña addressed several issues that she perceived to be the “three main questions” raised by the press coverage.

154 Menchel told OPR that when he and Sanchez were in the USAO, they had a social relationship, which included, in 2003, “a handful of dates over a period of two to three weeks. We decided that . . . this was probably best not to pursue, and we mutually agreed to not do that.”226 Apart from that, he stated they were “close” and “hung out,” and he asserted that this was known in the office at the time. Menchel said that his relationship with Sanchez “changed dramatically” when she left the office for private practice, and that by the time he became involved in the Epstein investigation, he had dated and married his wife, and his contact with Sanchez would “most likely” have been at office events and when she attended his wedding.227 Menchel added, “[T]hat was three and a half years [prior] for a very brief period of time, and I don’t think I gave it a moment’s thought.” When asked by OPR about the basis for the decision to make an offer of a two-year term of incarceration, Menchel said that he did not recall discussions about the two-year offer and did not recall how the office arrived at that figure. In response to OPR’s question, Menchel stated that his relationship with Sanchez did “[n]ot at all” affect his handling of the Epstein case. Moreover, Menchel asserted that the contemporaneous documentary record supports a conclusion that it was Acosta, not Menchel, who made the decision to resolve the case with the two-year term. OPR carefully considered the documentary record on this point, as well as the statements to OPR from Menchel, Villafaña, Sloman, and Acosta, and concludes that there is no evidence supporting the suggestion that the plea was instigated by Menchel as a favor to defense counsel. The USAO’s first plea overture to defense counsel, which took place sometime before June 26, 2007, occurred when Menchel spoke with Sanchez about the possibility of resolving the federal case with a state plea that required jail time and sexual offender registration. According to the email, “[i]t was a non-starter” for the defense. In the lengthy email exchange with Villafaña in early July 2007, Menchel told her that his discussion with Sanchez about a state-based resolution was made with Acosta’s “full knowledge.” Acosta corroborated this statement, telling OPR that although he did not remember a specific conversation with Menchel concerning a state-based resolution, he was certain Menchel would not have discussed this potential resolution with defense counsel “without having discussed it with me.”228 Moreover, the defense did not immediately 226 Acosta, Sloman, and Lourie each told OPR that in 2007, he was not aware that Menchel had previously dated Sanchez. OPR questioned the USAO’s Professional Responsibility Officer regarding whether Menchel had an obligation to inform his supervisors of his dating relationship. The Professional Responsibility Officer said that it would depend on “how long the relationship was and how compromised the individual felt he might appear to be,” but he would have expected Menchel to raise the issue with Acosta. The Professional Responsibility Officer told OPR that if he had been approached for advice at the time, he would have asked for more facts, but “[g]iven the sensitivity of the [Epstein] matter, [my advice] would probably have been to tell him to step back and let somebody else take it over.” Menchel told OPR that if his relationship with Sanchez had turned into something more than a handful of dates, he would have advised his supervisors. Although OPR does not conclude Menchel’s prior relationship with Sanchez influenced the Epstein investigation, OPR assesses that it would have been prudent for Menchel to have informed his supervisors so they could make an independent assessment as to whether his continued involvement in the Epstein investigation might create the appearance of a loss of impartiality. 227 Menchel’s Outlook records also indicate he scheduled lunch with Sanchez on at least one occasion, in early 2006, after she left the USAO. 228 In addition, Villafaña recalled Menchel stating at the July 26, 2007 meeting that “Alex has decided to offer a two year state deal.”

155 accept the two-year proposal when it was made, but instead continued to press for a sentence of home confinement, suggesting that the defense had not requested the two-year term as a favor and did not view it as such. The defense had previously rejected the state’s offer of a sentence of probation, and there is no indication in the contemporaneous records that Epstein viewed any jail sentence favorably and certainly that did not appear to be the view of the defense team in the early stages of the negotiations. As discussed below, after extensive questioning of the subjects about the basis for the two- year offer, and a thorough review of the documentary record, OPR was unable to determine the reasoning underlying the decision to offer two years as the term of incarceration, as opposed to any other term of years. Nonetheless, OPR concludes from the evidence that Acosta was aware of and approved the initial offer to the defense, which included the two-year term of incarceration. The only evidence suggesting that the offer of two years stemmed from an improper motivation of Menchel’s was a single second-hand statement in an email drafted many years later. Sloman, the purported declarant, told OPR that he could not recall whether he made the statement, but he firmly disputed that the email accurately reflected either the reason for the two-year proposal or his understanding of that reason. Villafaña herself could remember little about the critical conversation with Sloman, including whether she had recorded accurately what Sloman had said. Given the lack of any corroborating evidence, and the evidence showing Epstein’s vigorous resistance to the proposal, OPR concludes that there is no evidence to support the statement in Villafaña’s 2018 email that Menchel had extended a two-year plea deal as a favor to one of Epstein’s attorneys. E. The Evidence Does Not Establish That the Subjects’ Meetings with Defense Counsel Were Improper Benefits to Epstein OPR considered whether decisions by Acosta, Sloman, Menchel, and Lourie to meet with defense counsel while possible charges were under consideration or during the period after the NPA was signed and before Epstein entered his state guilty pleas evidenced improper favoritism toward or the provision of an improper benefit to the Epstein defense team. 1. The Evidence Shows That the Subjects’ Decisions to Meet with Epstein’s Legal Team Were Warranted by Strategic Considerations Although pre-indictment negotiations are typical in white-collar criminal cases involving financial crimes, witnesses told OPR that pre-charge meetings with defense counsel are infrequent in sex offense cases. As the lead prosecutor, Villafaña vehemently opposed meeting with Epstein’s attorneys and voiced her concerns to her supervisors, but was overruled by them. In Villafaña’s view, the significance of the early meetings granted to the defense team was that, but for those meetings, the USAO would not have offered the disposition set forth in the July 31, 2007 “term sheet” and, moreover, “that term sheet would never have been offered to anyone else.” OPR’s investigation established that while the defense attorneys persistently contacted the subjects through emails, correspondence, and phone calls, relatively few in-person meetings actually occurred with the USAO personnel involved in the matter. As shown in the chart on the following page, while the case was under federal investigation and before the NPA was signed, the subject supervisors and defense counsel had five substantive meetings about the case—

including one called by the USAO to off er the NP A term sheet resolution-and a sixth meeting together with the State Attorney and the lead state prosecutor to discuss the state plea. Acosta attended only one pre-NP A meeting. After the NP A was signed and before Epstein entered his state guilty pleas, the subject supervisors and the defense team had one substantive meeting, one unscheduled meeting on a procedural matter, and a meeting with one defense attorney in preparation for a conference call; in addition, Acosta had the breakfast meeting with Lefkowitz. 229 Date USAO Participants Defense Topic/Purpose Participants Pre-NPA Feb. 1, 2007 Lourie / Villafana Lefcomt / Sanchez Defense presents investigation improprieties and federal jurisdiction issues Feb.20, 2007 Lourie / Villafana Lefcomt / Sanchez Defense presents witness issues June 26, 2007 Sloman / Menchel / Dershowitz / Black Defense presents legal issues, Lourie / Villafana / Lefcomt / Sanchez investigation improprieties, and federal jurisdiction issues July 31, 2007 Sloman / Menchel / Black / Lefcomt / USAO presents NP A te1m sheet Lourie / Villafana Sanchez Sept. 7, 2007 Acosta / Oosterbaan / Stan / Lefkowitz / Defense presents counteroffer Sloman / Villafana / Sanchez Villafana's co-counsel Sept. 12, 2007 Lourie / Lourie Lefkowitz/ Lefcomt Joint meeting with Krischer / successor / Villafana / Goldberger Belohlavek re state plea provision of NP A Post-NPA Oct. 12, 2007 Acosta Lefkowitz Defense discussion of NPA te1ms and likely appeal to Depaitment Nov. 21, 2007 Sloman (possibly Lefkowitz (possibly Defense discussion of victims' ( unscheduled) Acosta) Dershowitz) attorney representative procedure Dec. 14, 2007 Acosta I Sloman / StaiT / Weinberg / Defense presents federal Villafana / another Dershowitz I jurisdiction issues, legal issues, senior AUSA Lefcomt and request for de nova review Jan. 7,2008 (1) Acosta I Sloman (1) Sanchez Defense presents USAO (2) Acosta / Sloman (2) Stan / improprieties and "watered- ( conference call) Lefkowitz/ Sanchez down" resolution 229 In addition, all of the subjects took phone calls from various defense attorneys, and although numerous documentary re.cords refer to such calls, there may have been others for which OPR located no record. 156

157 OPR explored the subject supervisors’ reasoning for accommodating the defense requests for in-person meetings and whether such accommodation was unusual. OPR questioned each of the four supervisory subject attorneys about his rationale for engaging in multiple meetings with the defense. Lourie could not recall his reasoning for meeting with Epstein’s defense counsel, but he told OPR that his general practice was to meet with defense counsel when asked to do so. Lourie recognized that some prosecutors—like Villafaña—viewed meeting with the defense as a sign of “weakness,” but in Lourie’s view, “information is power,” and as long as the USAO did not share information with the defense but rather listened to their arguments, meetings were “all power to us.” Lourie explained that by meeting with the defense, “[Y]ou’re getting the information that they think is important; that they’re going to focus on. The witnesses that they think are liars . . . . And so you can form all of that into your strategy.” Lourie also told OPR that giving defense counsel the opportunity to argue the defense position is an important “part of the process” that helped ensure procedural fairness, allowing them to “believe that they are getting heard.” When asked whether he afforded the same access to all defendants, Lourie responded, “I don’t recall ever getting . . . so many requests for meetings . . . and so many appeals and so many audiences that [Epstein’s attorneys] got. But this was I think the first time that that’s really happened.” Menchel, too, told OPR that his general view was that “ethically it’s appropriate” to give a defense attorney “an audience,” and there was no real “downside” to doing so. Menchel added, “[W]hat happens a lot of times is the government will carve around those points that are being raised by the defense, and it’s good to know” what the defense will be. During his OPR interview, Acosta rejected the notion that his meeting with defense counsel was unusual or outside the norm. He told OPR that his initial meeting with the defense team, before the NPA was signed, was “not the first and only time that I granted a meeting . . . to defense attorneys” who requested one. Acosta did not believe it was “atypical” for a U.S. Attorney to meet with opposing counsel, particularly as a case was coming to resolution. Sloman corroborated Acosta on this point, telling OPR that Acosta typically met with defense attorneys, and that the USAO handled requests for meetings from Epstein’s counsel “in the normal course.” Furthermore, Acosta said that notwithstanding that meeting and all the other “process” granted to the defense by the USAO and the Department, “we successfully held firm in our positions” on the key elements of the resolution—that is, the requirements that Epstein be incarcerated, register as a sexual offender, and provide monetary damages to the victims. OPR examined the circumstances surrounding each subject’s decisions to have the individual meetings with defense counsel to determine if those meetings had a neutral, strategic purpose. The first meeting, on February 1, 2007, followed a phone call between Lourie and one of Epstein’s attorneys, in which the attorney asked for a chance to “make a pitch” about the victims’ lack of credibility and suggested that Epstein might agree to an interview following that pitch. Villafaña objected to meeting with the defense, but she recalled that Lourie told her she was not being a “strategic thinker,” and that he believed the meeting could lead to a debriefing of Epstein. The meeting did not result in a debriefing of Epstein, but in advance of the follow-up meeting on February 20, 2007, defense counsel gave the USAO audio recordings of the state’s witness interviews. Contemporaneous documents indicate that Lourie was unpersuaded by the defense arguments. After Villafaña circulated the prosecution memorandum, Lourie suggested

158 preparing a “short” charging document “with only ‘clean’ victims that they have not dirtied up already.”230 The fact that Lourie apparently used information gleaned from the defense about the victims’ credibility to formulate his charging recommendation supported his statements to OPR that such meetings were, in his experience, a useful source of information that could be factored into the government’s charging strategy. The two February 2007 Villafaña/Lourie-level meetings focused on witness issues and claims of misconduct by state investigators, but in late May 2007, defense attorneys requested another meeting—this time with higher-level supervisors Menchel and Sloman—to make a presentation concerning legal deficiencies in a potential federal prosecution. The request was granted after Lourie recommended to Menchel and Sloman that “[i]t would probably be helpful to us . . . to hear their legal arguments in case we have missed something.” The requested meeting took place on June 26, 2007. Before the meeting, at Menchel’s direction, Villafaña provided to the defense a list of statutes the USAO was considering as the basis for federal charges. Defense counsel used that information to prepare a 19-page letter, submitted to the USAO the day before the June 26 meeting, as “an overview” of the defense position. In an email to his colleagues, Lourie evaluated the defense submission, noting its weaker and stronger arguments. A contemporaneous email indicates that Menchel, Lourie, and Villafaña viewed the meeting itself as primarily a “listening session.”231 After the meeting, Epstein’s team submitted a second lengthy letter to the USAO detailing Epstein’s “federalism” arguments that the USAO should let the state handle the matter. Menchel apparently scheduled the next meeting with defense counsel, on July 31, 2007, to facilitate the USAO’s presentation to the defense team of the “term sheet” describing the proposed terms of a non-prosecution agreement. By early August, after the Kirkland & Ellis attorneys—Starr and Lefkowitz—joined the defense team, Acosta believed they would likely “go to DC on the case, on the grounds . . . that I have not met with them.” A meeting with the defense team was eventually scheduled for September 7, 2007, when Acosta, Sloman, Villafaña, and Oosterbaan met with Starr, Lefkowitz, and Sanchez. In an email to Sloman, Acosta explained that he intended to meet with the defense, with Oosterbaan participating, “to discuss general legal policy only.” In another email to Sloman and Lourie, Acosta explained, “This will end up [in the Department] anyhow, if we don’t meet with them. I’d rather keep it here. Bringing [the CEOS Chief] in visibly does so. If our deadline has to slip a bit to do that, it’s worth it.” Acosta told OPR that the meeting “was not a negotiation,” but a chance for the defense to present their federalism arguments. Acosta said that he had already decided how he wanted to resolve the case, and “[t]he September meeting did not alter or shift our position.” 230 Lourie also recommended that the initial charging document “should contain only the victims they have nothing on at all.” 231 During her OPR interview, the FBI case agent recalled that defense counsel asked questions about the government’s case, including the number of victims and the type of sexual contact involved, and that during a break in the meeting, she engaged in a “discussion” with Menchel about providing this information to the defense. She did not recall specifics of the discussion, however.

159 The meeting of USAO representatives and Epstein’s defense attorneys, together with the State Attorney and the lead state prosecutor on September 12, 2007, was a necessary part of the NPA negotiation process. Even after the NPA was signed, the defense continued to request meetings and reviews of the case, both within the USAO and by the Department’s Criminal Division and the Deputy Attorney General. Although limited reviews were granted, during this period there was only one substantive meeting with Acosta, on December 14, 2007.232 This meeting occurred in lieu of the meeting Starr had requested of Assistant Attorney General Fisher, most likely because the defense submissions to the Department’s Criminal Division had raised issues not previously raised with the USAO and the Department determined that Acosta should address those in the first instance.233 Acosta told OPR that he did not ask for the Department review, but he also did not want to appear as if he “fear[ed]” that review. Acosta’s nuanced position, however, was not clear to the Department attorneys who responded to Epstein’s appeals and who perceived Acosta to be in favor of a Department review, rather than merely tolerant of it. Notably, though, none of those meetings or reviews resulted in the USAO abandoning the NPA, and Epstein gained no substantial advantage from his continued entreaties. In sum, in evaluating the subjects’ conduct, OPR considered the number of meetings, their purpose, the content of the discussions, and decisions made afterwards. OPR cannot say that the number of meetings, particularly those occurring before the NPA was signed, was so far outside the norm—for a high profile case with skilled defense attorneys—that the quantity of meetings alone shows that the subjects were motivated by improper favoritism. In evaluating the subjects’ conduct, OPR considered that the meetings were held with different levels of USAO managers and that the explanations for the decisions to participate in the meetings reflected reasonable strategic goals. Although OPR cannot rule out the possibility that because Acosta, Menchel, Lourie, or Sloman knew or knew of the defense attorneys, they may have been willing to meet with them, it is also true that prosecutors routinely meet with defense attorneys, including those who are known to them and those who are not. Furthermore, meetings are more likely to occur in high profile cases involving defendants with the financial resources to hire skilled defense counsel who request meetings at the highest levels of the USAO and the Department. Most significantly, OPR did not find evidence supporting a conclusion that the meetings themselves resulted in any substantial benefit to the defense. At each meeting, defense counsel strongly pressed the USAO—on factual, legal, and policy grounds—to forgo its federal investigation and to return the matter to the state to proceed as it saw fit. The USAO never yielded on that point. Accordingly, OPR did not find evidence supporting a conclusion that Acosta, Sloman, Menchel, Lourie, or Villafaña met with defense counsel for the purpose of benefiting Epstein or that the meetings themselves caused Acosta or the other subjects to provide improper benefits to Epstein. 232 Acosta’s October 12, 2007 breakfast meeting with Lefkowitz is discussed separately in the following section. 233 Starr and other defense attorneys only obtained one meeting at the Department level, with Deputy Assistant Attorney General Mandelker and CEOS Chief Oosterbaan in March 2008. Although Starr requested a meeting with Assistant Attorney General Fisher and another with Deputy Attorney General Filip, those requests were not granted.

160 2. The Evidence Does Not Establish That Acosta Negotiated a Deal Favorable to Epstein over Breakfast with Defense Counsel OPR separately considered the circumstances of one specific meeting that has been the subject of media attention and public criticism. The Miami Herald’s November 2018 reporting on the Epstein investigation opened with an account of the October 12, 2007 breakfast meeting that defense counsel Jay Lefkowitz arranged to have with Acosta at the West Palm Beach Marriott hotel. According to the Miami Herald article, “a deal was struck” at the meeting to allow Epstein to serve “just 13 months” in the county jail in exchange for the shuttering of the federal investigation, and Acosta also agreed to “conceal” the full extent of Epstein’s crimes from the victims and the public.234 Although public criticism of the meeting has focused on the fact that the meeting occurred in a hotel far from Acosta’s Miami office, the evidence shows that Acosta traveled to West Palm Beach on October 11 for a press event and stayed overnight at the hotel, near the USAO’s West Palm Beach office, because at midday on October 12 he was to speak at the Palm Beach County Bench Bar Conference. After carefully considering the evidence surrounding the breakfast meeting, including contemporaneous email communications and witness accounts, OPR concludes that Acosta did not negotiate the NPA, or make any significant concessions relating to it, during or as a result of the October breakfast meeting. Epstein and his attorneys signed the NPA on September 24, 2007—more than two weeks before the October 12 breakfast meeting. The signed NPA contained all of the key provisions resulting from the preceding weeks of negotiations between the parties, and despite a later addendum and ongoing disputes about interpreting the damages provision of the agreement, those key provisions remained in place thereafter. Acosta told OPR that throughout the negotiations with the defense, he sought three goals: (1) Epstein’s guilty plea in state court to an offense requiring registration as a sexual offender; (2) a sentence of imprisonment; and 3) a mechanism through which victims could obtain monetary damages from Epstein. As noted previously, the USAO’s original plea offer in Menchel’s August 3, 2007 letter expressed a “non-negotiable” demand that Epstein agree to a two-year term of imprisonment, and the final NPA required only an 18-month sentence, but the decision to reduce the required term of imprisonment from 24 to 18 months was made well before Acosta’s breakfast meeting with counsel. The NPA signed on September 24, 2007, required 18 months’ incarceration, sexual offender registration, and a mechanism for the victims to obtain monetary damages from Epstein, and OPR found that these terms were not abandoned or materially altered after the breakfast meeting. At the time of Acosta’s October breakfast meeting with Lefkowitz, two issues involving the NPA were in dispute. Neither of those issues was ultimately resolved in a way that materially changed the key provisions of the NPA. First, at Sloman’s instigation, the USAO sought to change the mechanism for appointing an attorney representative for the victims. This USAO-initiated request had prompted discussions about an “addendum” to the NPA. Sloman sent the text of a proposed NPA addendum to Lefkowitz on October 11, 2007.235 Although OPR found no decisive 234 Julie K. Brown, “Perversion of Justice: How a future Trump Cabinet member gave a serial sex abuser the deal of a lifetime,” Miami Herald, Nov. 28, 2018. 235 In his December 19, 2007, letter to defense attorney Sanchez, Acosta represented that he had proposed the addendum at the breakfast meeting, but it is clear the addendum was being developed before then.

161 proof that this led to the breakfast meeting, email exchanges between Lefkowitz and Acosta show that it was under discussion at the time they were scheduling the meeting. Shortly after the breakfast meeting, Sloman, in Miami, sent an email to Lefkowitz (copying Acosta and Villafaña), noting that he “just got off the phone with Alex” and offering a slightly revised portion of the addendum relating to the mechanism for selection of the attorney representative. Sloman later clarified for Villafaña that “Jay’s suggested revision has been rejected.” A second area of continuing negotiation arose from the defense claim that Epstein’s obligation under the NPA to pay the attorney representative’s fees did not obligate him to pay the fees and costs of contested litigation filed against him. Although this was at odds with the USAO’s interpretation of the provision, the USAO and defense counsel reached agreement and clarified the provision in the NPA addendum that was finalized several weeks after the October breakfast meeting. Although the revised provision was to Epstein’s advantage, the revision concerned attorney’s fees and did not materially impede the victims’ ability to seek damages from Epstein under § 2255. The fact that the negotiations continued after the breakfast meeting indicates that Acosta did not make promises at the meeting that resolved the issue. OPR found limited contemporaneous evidence concerning the discussion between Acosta and Lefkowitz. In a letter sent to Acosta on October 23, 2007, two weeks after the breakfast meeting, Lefkowitz represented that Acosta made three significant concessions during the meeting. Specifically, Lefkowitz claimed that Acosta had agreed (1) not to intervene with the State Attorney’s Office’s handling of the case, (2) not to contact any of the victim-witnesses or their counsel, and (3) not to intervene regarding the sentence Epstein received. Acosta told OPR that he did not remember the breakfast meeting and did not recall making the commitments defense counsel attributed to him. Acosta also told OPR that Lefkowitz was not a reliable narrator of events, and on several occasions in written communications had inaccurately and misleadingly characterized conversations he had with Acosta. Of more significance for OPR’s evaluation was a contemporaneous document—an October 25, 2007 draft response to Lefkowitz’s letter, which Sloman drafted, and Acosta reviewed and edited for signature by Sloman—that disputed Lefkowitz’s claims. The draft letter stated: I specifically want to clarify one of the items that I believe was inaccurate in that October 23rd letter. Your letter claimed that this Office would not intervene with the State Attorney’s Office regarding this matter; or contact any of the identified individuals, potential witnesses, or potential civil claimants and their respective counsel in this matter; and neither your Office nor the [FBI] would intervene regarding the sentence Mr. Epstein receives pursuant to a plea with the State, so long as that sentence does not violate state law. As we discussed and, hopefully, clarified, and as the United States Attorney previously explained in an earlier conference call, such a

162 promise equates to the imposition of a gag order. Our Office cannot and will not agree to this. It is the intent of this Office to treat this matter like any other case. Acosta told OPR that this was a polite way of chastising Lefkowitz for mischaracterizing what Acosta said during the breakfast meeting. Although OPR could not find evidence that the letter was sent to Lefkowitz, OPR nonetheless considers it persuasive evidence that Acosta, shortly after the breakfast meeting, disagreed with Lefkowitz’s description of their discussions and had discussed those disagreements with Sloman. Nevertheless, OPR examined the three specific concessions that Lefkowitz described in the October 23 letter, to determine whether evidence reflected that Acosta had made them during the breakfast meeting. First, Lefkowitz claimed that Acosta agreed during the breakfast meeting that he did not intend to interfere with the state’s handling of the case. Contemporaneous documents show that well before the breakfast meeting, Acosta had expressed the view that he did not want to “dictate” actions to the State Attorney or the state court. For example, during the NPA negotiations, Acosta asked Villafaña to “soften” certain language that appeared to require the State Attorney’s Office or the state court to take specific actions, such as requiring that Epstein enter his guilty plea or report to begin serving his sentence by a certain date. Although Acosta may have made a statement during the breakfast meeting expressing his disinclination to interfere with the state’s proceedings, such a statement would have been a reiteration of his prior position on the subject, rather than any new concession. Lefkowitz also claimed in his October 23, 2007 letter that Acosta agreed not to contact any of the victims or potential witnesses or their counsel. For the reasons discussed more fully in Chapter Three, OPR concludes that the decision not to notify the victims about the NPA did not stem from the breakfast meeting, but rather reflected an assessment of multiple issues and considerations discussed internally by the subjects who participated in that decision: Acosta, Sloman, and Villafaña. Finally, Lefkowitz’s October 23 letter suggested that Acosta had agreed not to intervene regarding the sentence Epstein received from the state court, and it asserted that Epstein was “entitled to any type of sentence available to him, including but not limited to gain time and work release.” Later communications between the USAO and defense counsel, however, show clearly that Acosta did not abandon the NPA’s explicit sentencing provision. The NPA required Epstein to make a joint recommendation with the State Attorney’s Office for an 18-month jail sentence, although the parties understood that he would receive the same “gain time” benefits available to all state inmates. After the October breakfast meeting, Sloman and Villafaña, on behalf of the USAO, repeatedly made clear that it would hold Epstein to that requirement, and the USAO also subsequently insisted that Epstein was ineligible for work release. For example, in a November 5, 2007 letter, Sloman requested confirmation from defense counsel that “Epstein intends to abide by his agreement to plead guilty to the specified charges and to make a binding recommendation that the Court impose a sentence of 18 months of continuous confinement in the county jail.” Shortly before Epstein entered his plea in June 2008, Villafaña wrote to the State Attorney to remind him that the NPA required Epstein to plead in state court to an offense that required an 18-month

163 sentence of incarceration, and the USAO would consider a plea that differed from that requirement a breach of the NPA and would “proceed accordingly.” The guilty plea Epstein entered in state court in June 2008 was consistent with the dictates of the NPA, and pursuant to that plea, the court imposed a sentence of 18 months’ incarceration. Epstein, however, applied for and was accepted into the work release program, and was able to serve a substantial portion of his sentence outside of the jail. The NPA did not reference work release nor authorize Epstein to receive such benefits during his tenure at the Palm Beach County Stockade. Moreover, Villafaña received assurances from defense counsel that Epstein would serve his entire sentence of confinement “in custody.” Responsibility for the decision to afford Epstein work release privileges during his incarceration rested with state officials, who had the sole authority for administering the work release program. After considering the substantial record documenting the decisions made after Acosta’s October 12, 2007 breakfast meeting with Lefkowitz, OPR found nothing in the record to suggest that the meeting resulted in a material change to the NPA, affected the sentence Epstein served pursuant to the NPA, or contributed to state officials’ decision to permit him to participate in work release. F. Villafaña’s Emails with Defense Attorney Lefkowitz during the NPA Negotiations Do Not Establish That Villafaña, or Other Subjects, Intended to Give Epstein Preferential Treatment or Were Motivated by Favoritism or Other Improper Influences During the CVRA litigation, the petitioners obtained from Epstein’s attorney, and filed under seal, a redacted series of email exchanges between Epstein attorney Lefkowitz and Villafaña (and others with Acosta and Sloman) during September 2007 when the NPA was being finalized, and thereafter. These emails had been redacted to delete most of Lefkowitz’s side of the communications, and consequently they did not reflect the full context of Villafaña’s communications to Lefkowitz. The redacted emails were later unsealed and made public over Epstein’s objections.236 Media coverage pointed to the content and tone of Villafaña’s emails as proof that Villafaña and the USAO worked in concert with Epstein’s attorneys to keep the “sweetheart” deal a secret from the victims and the public. Statements in several emails in particular were cited as evidence of the USAO’s improper favoritism towards Epstein. In one example, Villafaña told Lefkowitz that she was willing to include in the NPA a provision agreeing not to prosecute others, but would “prefer not to highlight for the judge all of the other crimes and all of the other persons that we could charge.” She also offered to meet with him “‘off campus’” to finalize negotiations. She also proposed, “[o]n an ‘avoid the press’ note,” that filing federal charges against Epstein in Miami rather than West Palm Beach would substantially reduce press coverage. 236 The USAO did not object to the unsealing but requested additional redactions of portions that would reveal protected information. United States’ Response to Petitioners’ Motion to Use Correspondence to Prove Violations of the [CVRA] and to Have Their Unredacted Pleadings Unsealed (Apr. 7, 2011). The court declined to order the additional redactions.

164 OPR asked Villafaña about these emails and about the tenor of her interactions with Lefkowitz during the NPA negotiations and with other defense attorneys generally. Villafaña acknowledged that their tone was collegial and collaborative, and explained that generally, the tone of these emails reflected her personality and her commitment to complete the task her supervisors had assigned to her: [I]f you were to pull all my e-mails on every case, you would find that that is how I communicate with people. I’m a Minnesota girl, and I prefer not to be confrontational until I have to be. And I can be when I need to be. But my instructions from my supervisors were to engage in these negotiations and to complete them. So I felt that given that task, the best way to complete them was to reach the agreement and, keeping in mind the terms that . . . our office had agreed to, and do that in a way that is civil. So . . . although my language in the kind of introductory or prefatory communications with Mr. Lefkowitz was casual and was friendly, when you look at the terms and when he would come back to me asking for changes, my response was always, “No, I will not make that change.” Villafaña denied any intention to keep the victims uninformed about the NPA or to provide an improper benefit for Epstein, and she explained the context of the emails in question. The email in which Villafaña expressed reluctance to “highlight for the judge all of the other crimes and all of the other persons that we could charge” was written in response to a defense proposal to include in the federal plea agreement the parties were then considering a promise by the government not to prosecute Epstein’s assistants and other employees. Lefkowitz had proposed that the plea agreement state, “Epstein’s fulfilling the terms and conditions of the Agreement also precludes the initiation of any and all criminal charges which might otherwise in the future be brought against [four named female assistants] or any employee of [a specific Epstein-owned corporate entity] for any criminal charge that arises out of the ongoing federal investigation.” Villafaña told OPR that the USAO was not intending to charge Epstein’s assistants and was not aware of anyone else who could be charged, and thus did not oppose the request not to prosecute third parties. However, Villafaña was concerned that an overly detailed federal plea agreement would prompt the court to require the government to provide further information about the uncharged conduct, which might lead Epstein to claim the government breached the agreement by providing information to the court not directly connected to the charges to which he was pleading guilty. Villafaña was not the only one to express concern about how deeply a federal court might probe the facts, and whether such probing would interfere with the viability of a plea agreement. In an earlier email, Lourie had suggested charging Epstein by complaint to allow the USAO more flexibility in plea negotiations and avoid the problem that a court might not accept a plea to a conspiracy charge that required dismissal of numerous substantive counts. As to Villafaña’s offer to meet with Lefkowitz “off campus” to resolve outstanding issues in the NPA negotiation, she explained to OPR that she believed a face-to-face meeting at a “neutral” location—with “all the necessary decision makers present or ‘on call’”— might facilitate completion of the negotiations, which had dragged on for some time.

165 With regard to her comment about “avoid[ing] the press,” Villafaña told OPR that her goal was to protect the anonymity of the victims. She said that the case was far more likely to be covered by the Palm Beach press, which had already written articles about Epstein, than in Miami, and “if [the victims] wanted to attend [the plea hearing], I wanted them to be able to go into the courthouse without their faces being splashed all over the newspaper.” In evaluating the emails, OPR reviewed all the email exchanges between Villafaña, as well as Sloman and Acosta, and Lefkowitz and other defense counsel, including the portions redacted from the publicly released emails (except for a few to or from Acosta, copies of which OPR did not locate in the USAO records). OPR also considered the emails in the broader context of Villafaña’s overall conduct during the federal investigation of Epstein. The documentary record, as well as witness and subject interviews, establishes that Villafaña consistently advocated in favor of prosecuting Epstein and worked for months toward that goal. She repeatedly pressed her supervisors for permission to indict Epstein and made numerous efforts to expand the scope of the case. She opposed meetings with the defense team, and nearly withdrew from the case because her supervisors agreed to those meetings. Villafaña objected to the decision to resolve the case through a guilty plea in state court, and she engaged in a lengthy and heated email exchange with Menchel about that subject. When she was assigned the task of creating an agreement to effect that resolution, Villafaña fought hard during the ensuing negotiations to hold the USAO’s position despite defense counsel’s aggressive tactics. OPR also considered statements of her supervisors regarding her interactions with defense counsel. Sloman, in particular, told OPR that reports that Villafaña “was soft on Epstein . . . couldn’t have been further from the truth.” Sloman added that Villafaña “did her best to implement the decisions that were made and to hold Epstein accountable.” Lourie similarly told OPR that when he read the district court’s February 2019 opinion in the CVRA litigation and the emails from Villafaña cited in that opinion, he was “surprised to see how nice she was to them. And she winds up taking it on the chin for being so nice to them. When I know the whole time she was the one who wanted to go after him the most.” The AUSA who assisted Villafaña on the investigation told OPR “everything that [Villafaña] did . . . was, as far as I could tell, [ ] completely pro prosecution.” Because the emails in question were publicly disclosed without context and without other information showing Villafaña’s consistent efforts to prosecute Epstein and to assist victims, a public narrative developed that Villafaña colluded with defense counsel to benefit Epstein at the expense of the victims. After thoroughly reviewing all of the available evidence, OPR finds that narrative to be inaccurate. The USAO’s and Villafaña’s interactions with the victims can be criticized, as OPR does in several respects in this Report, but the evidence is clear that any missteps Villafaña may have made in her interactions with victims or their attorneys were not made for the purpose of silencing victims. Rather, the evidence shows that Villafaña, in particular, cared deeply about Epstein’s victims. Before the NPA was signed, she raised to her supervisors the issue of consulting with victims, and after the NPA was signed, she drafted letters to notify victims identified in the federal investigation of the pending state plea proceeding and inviting them to appear. The draft letters led defense counsel to argue to Department management that Villafaña and Sloman committed professional misconduct by “threaten[ing] to send a highly improper and unusual ‘victim notification letter’ to all” of the listed victims. Given the full context of Villafaña’s conduct throughout her tenure on the case, OPR concludes that her explanations for her emails are

166 entitled to significant weight, and OPR credits them. OPR finds, therefore, that the emails in question do not themselves establish that Villafaña (or any other subject) acted to improperly benefit Epstein, was motivated by favoritism or other improper influences, or sought to silence victims. G. The Evidence Does Not Establish That Acosta, Lourie, or Villafaña Agreed to the NPA’s Provision Promising Not to Prosecute “Potential Co-conspirators” in Order to Protect Any of Epstein’s Political, Celebrity, or Other Influential Associates OPR examined the decision by the subjects who negotiated the NPA—Villafaña, Lourie, and Acosta—to include in the agreement a provision in which the USAO agreed not to prosecute “any potential co-conspirators of Epstein,” in addition to four named individuals, to determine whether that provision resulted from the subjects’ improper favoritism towards Epstein or an improper effort to shield from prosecution any of Epstein’s known associates. Other than various drafts of the NPA and of a federal plea agreement, OPR found little in the contemporaneous records mentioning the provision and nothing indicating that the subjects discussed or debated it— or even gave it much consideration. Drafts of the NPA and of the federal plea agreement show that the final broad language promising not to prosecute “any potential co-conspirators of Epstein” evolved from a more narrow provision sought by the defense. The provision expanded as Villafaña and defense counsel exchanged drafts of, first, a proposed federal plea agreement and, then, of the NPA, with apparently little analysis and no substantive discussion within the USAO about the provision.237 As the NPA drafting process concluded, Villafaña circulated to Lourie and another supervisor a draft that contained the non-prosecution provision, telling Lourie it was “some of [defense counsel’s] requested language regarding promises not to prosecute other people,” and commenting only, “I don’t think it hurts us.” In a reply email, Lourie responded to another issue 237 As set forth in OPR’s factual discussion, early in the negotiations over a federal plea agreement, the defense sought a non-prosecution provision applicable to only four female named assistants of Epstein and to unnamed employees of one of his companies. Villafaña initially countered with “standard language” referring to unnamed “co-conspirators” so as to avoid “highlight[ing] for the judge all of the other crimes and all of the other persons that we could charge.” Nonetheless, drafts of the NPA sent by Lefkowitz after Villafaña’s email continued to include language referring to the four named assistants and unnamed employees. Villafaña, however, internally circulated drafts of a federal plea agreement that included language stating, “This agreement resolves the federal criminal liability of the defendant and any co-conspirators in the Southern District of Florida growing out of any criminal conduct by those persons known to the [USAO] as of the date of this plea agreement.” The federal plea agreement draft revised by Lourie and Acosta on September 20, 2007, included that language. When the defense team reverted to negotiation of state charges, Villafaña advised them, “In the context of a non-prosecution agreement, the [USAO] may be more willing to be specific about not pursuing charges against others.” The next day, Lefkowitz sent a revised draft NPA referring to the four named assistants, “any employee” of the named company, and “any unnamed co-conspirators for any criminal charge that arises out of the ongoing federal investigation.” The language was finally revised by Villafaña to prohibit prosecution of “any potential co-conspirators of Epstein, including but not limited to [the four named assistants].” In commenting on OPR’s draft report, Villafaña’s counsel and Lourie both noted that the non-prosecution provision could bind only the USAO, and Lourie further opined that it was limited to certain specified federal charges and a time-limited scope of conduct. Although the non-prosecution provision in the NPA did not explicitly contain such limitations, those limitations were included in other parts of the agreement.

167 Villafaña had raised (defense counsel’s attempt to insert an immigration waiver into the agreement), but Lourie did not comment on the provision promising not to prosecute co- conspirators or ask Villafaña to explain why she believed the provision did not harm the government’s interests. In a subsequent email about the draft NPA, Villafaña asked Lourie for “[a]ny other thoughts,” but there is no indication that he provided further input. OPR found no document that suggested Villafaña and Lourie discussed the provision further, or that the other individuals who were copied on Villafaña’s email referencing the provision—her immediate supervisor, the supervisor designated to succeed Lourie as manager of the West Palm Beach office, and Villafaña’s co-counsel—commented on or had substantive discussions about it. Villafaña told OPR that because none of the three supervisors responded to her observation that the non- prosecution provision “doesn’t hurt us,” Villafaña assumed that they agreed with her assessment. Villafaña told OPR that she could not recall a conversation specifically about the provision agreeing not to prosecute “any potential co-conspirators,” but she remembered generally that defense counsel told her Epstein wanted “to make sure that he’s the only one who takes the blame for what happened.” Villafaña told OPR that she and her colleagues believed Epstein’s conduct was his own “dirty little secret.” Villafaña said that press coverage at the time of Epstein’s 2006 arrest did not allege that any of his famous contacts participated in Epstein’s illicit activity and that none of the victims interviewed by the case agents before the NPA was signed told the investigators about sexual activity with any of Epstein’s well-known contacts about whom allegations arose many years later.238 Villafaña acknowledged that investigators were aware of Epstein’s longtime relationship with a close female friend who was a well-known socialite, but, according to Villafaña, in 2007, they “didn’t have any specific evidence against her.”239 Accordingly, Villafaña believed that the only “co-conspirators” of Epstein who would benefit from the provision were the four female assistants identified by name.240 Villafaña also told OPR that the focus of the USAO’s investigation was Epstein, and the office was not inclined to prosecute his four assistants if he entered a plea.241 Because Villafaña was unaware of anyone else who could or would be charged, she perceived no reason to object to a provision promising not to prosecute other, unspecified “co-conspirators.” Villafaña told OPR that given her understanding of the facts at that time, it did not occur to her that the reference to other “potential co-conspirators” might be used to protect any of Epstein’s influential associates. Lourie, who was transitioning to his detail at the Department’s Criminal Division at the time Villafaña forwarded to him the draft NPA containing the non-prosecution provision, told OPR that he did not know how the provision developed and did not recall any discussions about it. 238 Villafaña told OPR that “none of . . . the victims that we spoke with ever talked about any other men being involved in abusing them. It was only Jeffrey Epstein.” 239 The FBI had interviewed one victim who implicated the female friend in Epstein’s conduct, but the conduct involving the then minor did not occur in Florida. 240 The FBI had learned that one of Epstein’s female assistants had engaged in sexual activity with at least one girl in Epstein’s presence; this assistant was one of the named individuals for whom the defense sought the government’s agreement not to prosecute from the outset. Villafaña explained to OPR that this individual was herself believed to also have been at one time a victim. 241 Villafaña told OPR that the USAO had decided that girls who recruited other girls would not be prosecuted.

168 Lourie described the promise not to prosecute “potential co-conspirators” as “unusual,” and told OPR that he did not know why it was included in the agreement, but added that it would be “unlike me if I read that language to just leave it in there unless I thought it was somehow helpful.” Lourie posited that victims who recruited other underage girls to provide massages for Epstein “theoretically” could have been charged as co-conspirators. He told OPR that when he saw the provision, he may have understood the reference to unnamed “co-conspirators” as “a message to any victims that had recruited other victims that there was no intent to charge them.” Acosta did not recall any discussions about the non-prosecution provision. But he told OPR that Epstein was always “the focus” of the federal investigation, and he would have viewed the federal interests as vindicated as long as Epstein was required to face “meaningful consequences” for his actions. Acosta told OPR that when he reviewed the draft NPA, “[t]o the extent I reviewed this co-conspirator provision, I can speculate that my thinking would have been the focus is on Epstein[ ] . . . going to jail. Whether some of his employees go to jail, or other, lesser involved [individuals], is not the focus of this.” Acosta also told OPR that he assumed Villafaña and Lourie had considered the provision and decided that it was appropriate. Finally, Sloman, who was not involved in negotiating the NPA, told OPR that in retrospect, he understood the non-prosecution provision was designed to protect Epstein’s four assistants, and it “never dawned” on him that it was intended to shield anyone else. This broad provision promising not to prosecute “any potential co-conspirators” is troubling and, as discussed more fully later in this Report, OPR did not find evidence showing that the subjects gave careful consideration to the potential scope of the provision or whether it was warranted given that the investigation had been curtailed and the USAO lacked complete information regarding possible co-conspirators. Villafaña precipitously revised a more narrow provision sought by the defense. Given its evolution from a provision sought by the defense, it appears unlikely to have been designed to protect the victims, and there is no indication that at the time, the subjects believed that was the purpose. However, the USAO had not indicated interest in prosecuting anyone other than the four named female assistants, and OPR found no record indicating that Epstein had expressed concern about the prosecutive fate of anyone other than the four assistants and unnamed employees of a specific Epstein company. Accordingly, OPR concludes that the evidence does not show that Acosta, Lourie, or Villafaña agreed to the non- prosecution provision to protect any of Epstein’s political, celebrity, or other influential associates.242 H. OPR’s Investigation Did Not Reveal Evidence Establishing That Epstein Cooperated in Other Federal Investigations or Received Special Treatment on That Basis One final issue OPR explored stemmed from media reports suggesting that Epstein may have received special treatment from the USAO in return for his cooperation in another federal 242 As previously stated, Sloman was on vacation when Villafaña included the provision in draft plea agreements and did not monitor the case or comment on the various iterations of the NPA that were circulated during his absence. Menchel left the USAO on August 3, 2007, before the parties drafted the NPA.

169 investigation.243 Media reports in mid-2009 suggested Epstein was released from his state incarceration “early” because he was assisting in a financial crimes investigation in the Eastern District of New York involving Epstein’s former employer, Bear Stearns. At the time, Villafaña was notified by the AUSAs handling the matter that they “had never heard of” Epstein and he was providing “absolutely no cooperation” to the government. In 2011, Villafaña reported to senior colleagues that “this is urban myth. The FBI and I looked into this and do not believe that any of it is true.” Villafaña told OPR that the rumor that Epstein had cooperated with the case in New York was “completely false.” Acosta told OPR that he did not have any information about Epstein cooperating in a financial investigation or relating to media reports that Epstein had been an “intelligence asset.”244 In addition to the contemporaneous record attesting that Epstein was not a cooperating witness in a federal matter, OPR found no evidence suggesting that Epstein was such a cooperating witness or “intelligence asset,” or that anyone—including any of the subjects of OPR’s investigation—believed that to be the case, or that Epstein was afforded any benefit on such a basis. OPR did not find any reference to Epstein’s purported cooperation, or even a suggestion that he had assisted in a different matter, in any of the numerous communications sent by defense counsel to the USAO and the Department. It is highly unlikely that defense counsel would have omitted any reason warranting leniency for Epstein if it had existed. Accordingly, OPR concludes that none of the subjects of OPR’s investigation provided Epstein with any benefits on the basis that he was a cooperating witness in an unrelated federal investigation, and OPR found no evidence establishing that Epstein had received benefits for cooperation in any matter. V. ACOSTA EXERCISED POOR JUDGMENT BY RESOLVING THE FEDERAL INVESTIGATION THROUGH THE NPA Although OPR finds that none of the subjects committed professional misconduct in this matter, OPR concludes that Acosta exercised poor judgment when he agreed to end the federal investigation through the NPA. Acosta’s flawed application of Petite policy principles to this case and his concerns with overstepping the boundaries of federalism led to a decision to resolve the federal investigation through an NPA that was too difficult to administer, leaving Epstein free to manipulate the conditions of his sentence to his own advantage. The NPA relied on state authorities to implement its key terms, leading to an absence of control by federal authorities over the process. Although the prosecutors considered certain events that they addressed in the NPA, such as gain time and community control, many other key issues were not, such as work release and mechanisms for implementing the § 2255 provision. Important provisions, such as promising not to prosecute all “potential co-conspirators,” were added with little discussion or consideration by the prosecutors. In addition, although there were evidentiary and legal challenges to a 243 See, e.g., Julie K. Brown, “Perversion of Justice: How a future Trump Cabinet member gave a serial sex abuser the deal of a lifetime,” Miami Herald, Nov. 28, 2018. 244 When OPR asked Acosta about his apparent equivocation during his 2019 press conference, in answering a media question about whether he had knowledge of Epstein being an “intelligence asset,” Acosta stated to OPR that “the answer is no.” Acosta was made aware that OPR could use a classified setting to discuss intelligence information.

170 successful federal prosecution, Acosta prematurely decided to resolve the case without adequately addressing ways in which a federal case potentially could have been strengthened, such as by obtaining Epstein’s missing computer equipment. Finally, a lack of coordination within the USAO compounded Acosta’s flawed reasoning and resulted in insufficient oversight over the process of drafting the NPA, a unique document that required more detailed attention and review than it received. These problems were, moreover, entirely avoidable because federal prosecution, and potentially a federal plea agreement, existed as viable alternatives to the NPA resolution. In evaluating Acosta’s conduct, OPR has considered and taken into account the fact that some of Epstein’s conduct known today was not known in 2007 and that other circumstances have changed in the interim, including some victims’ willingness to testify. OPR has also evaluated Acosta’s decisions in a framework that recognizes and allows for decisions that are made in good faith, even if the decision in question may not have led to the “best” result that potentially could have been obtained. Nonetheless, after considering all of the available evidence and the totality of the then-existing circumstances, OPR concludes that Acosta exercised poor judgment in that he chose an action or course of action that was in marked contrast to that which the Department would reasonably expect of an attorney exercising good judgment. A. Acosta’s Decision to Resolve the Federal Investigation through a State Plea under Terms Incorporated into the NPA Was Based on a Flawed Application of the Petite Policy and Federalism Concerns, and Failed to Consider the Significant Disadvantages of a State-Based Resolution The Department formulated the Petite policy in response to a series of Supreme Court opinions holding that the Constitution does not deny state and federal governments the power to prosecute for the same act. Responding to the Court’s concerns about the “potential for abuse in a rule permitting duplicate prosecutions,” the Department voluntarily adopted a policy of declining to bring a federal prosecution following a completed state prosecution for the same conduct, except when necessary to advance a compelling federal interest. See Rinaldi v. United States, 434 U.S. at 28. On its face, the Petite policy applies to federal prosecutions that follow completed state prosecutions. USAM § 9-2.031 (“This policy applies whenever there has been a prior state . . . prosecution resulting in an acquittal, a conviction, including one resulting from a plea agreement, or a dismissal or other termination of the case on the merits after jeopardy has attached.”). When a state investigation or prosecution is still pending, the policy does not apply. Indeed, even when a state prosecution has resulted in a decision on the merits, the policy permits a subsequent federal prosecution when three substantive prerequisites are satisfied: a “substantial federal interest” exists, “the result in the prior state prosecution was manifestly inadequate in light of the federal interest involved,” and there is sufficient admissible evidence to obtain and sustain a conviction on federal charges. The policy also does not apply when “the prior prosecution involved only a minor part of the contemplated federal charges.” No one with whom OPR spoke disputed that the federal government had a substantial interest in prosecuting Epstein. In her prosecution memorandum, Villafaña identified five federal statutes that Epstein had potentially violated. The CEOS Chief described Villafaña’s assessment of these statutes as “exhaustive,” and he concurred with her analysis of their applicability to the facts of the case. Epstein’s crimes involved the sexual exploitation of children, interstate travel, and the use of a facility of interstate commerce, all of which were areas of federal concern.

171 Notably, in the early 2000s, the Department had begun pursuing specific initiatives to combat child sex trafficking, including Project Safe Childhood, and Congress had then recently passed the PROTECT Act. Acosta himself told OPR that the exploitation of minors was “an important federal interest,” which in Epstein’s case was compounded by the “sordidness” of the acts involved and the number of victims. It is also clear that because the state case against Epstein was still pending and had not reached a conviction, acquittal, or other decision on the merits, the Petite policy did not apply and certainly did not preclude a federal prosecution of Epstein. He had been charged with one state charge of solicitation to prostitution on three occasions, involving one or more other persons without regard to age—a charge that would have addressed only a scant portion of the conduct under federal investigation. Acosta acknowledged to OPR that the Petite policy “on its face” did not apply. Moreover, the State Attorney did not challenge the federal government’s assumption of prosecutorial responsibility, and despite having obtained an indictment, held back on proceeding with the state prosecution in deference to the federal government’s involvement. In these circumstances, the USAO was free to proceed with a prosecution sufficient to ensure vindication of the federal interest in prosecuting a man who traveled interstate repeatedly to prey upon minors. The federal government was uniquely positioned to fully investigate the conduct of an individual who engaged in repeated criminal conduct in Florida but who also traveled extensively and had residences outside of Florida. Even if the Petite policy had applied, OPR has little doubt that the USAO could have obtained authorization from the Department to proceed with a prosecution under the circumstances of this case.245 Despite the undeniable federal interest in prosecuting Epstein, the fact that the Petite policy did not apply, and the State Attorney’s willingness to hold the state prosecution in abeyance pending the federal government’s assumption of the case, Acosta viewed the federal government’s role in prosecuting Epstein as limited by principles of federalism.246 In essence, Acosta believed that a federal prosecution would have interfered improperly with the state’s authority. He explained his reasoning to OPR: 245 In 2008, the Office of Enforcement Operations, the office charged with reviewing Petite policy waiver requests, opined that even if the Petite policy applied with respect to the victims of the indicted state charges, it would not apply to federal prosecution of charges relating to any other victim. The office also noted that if other factors existed, such as use of the internet to contact victims, those factors might warrant a waiver of the policy, if it did apply. 246 In commenting on OPR’s draft report, Acosta’s counsel argued that OPR inappropriately bifurcated Acosta’s concerns from those of the other subjects. However, OPR’s investigation made clear that, although Acosta shared his subordinates’ concerns about the strength of the case, victim-witness credibility, and the novelty of some legal theories, he alone focused on federalism issues. Acosta’s counsel also asserted that OPR “misunderstands and devalues Secretary Acosta’s very real and legitimate interest in the development of human trafficking laws,” and counsel further noted Acosta’s concerns that “bringing a case with serious evidentiary challenges pressing novel legal issues could result in an outcome that set back the development of trafficking laws and resulted in an aggregate greater harm to trafficking victims.” Although OPR carefully considered counsel’s arguments and agrees that it was appropriate to consider any implications the proposed prosecution of Epstein might have for the Department’s anti- trafficking efforts, OPR does not believe that those concerns warranted resolving the matter through the NPA, which, for the reasons discussed in this Section, failed to satisfy the federal interest and allowed Epstein to manipulate the state system to his benefit.

172 [The prosecution] was going forward on the part of the state, and so here is the big bad federal government stepping on a sovereign . . . state, saying you’re not doing enough, [when] to my mind . . . the whole idea of the [P]etite policy is to recognize that the []state . . . is an independent entity, and that we should presume that what they’re doing is correct, even if we don’t like the outcome, except in the most unusual of circumstances. Acosta told OPR that “absent USAO intervention,” the state’s prosecution of Epstein would have become final, and accordingly, it was “prudent” to employ Petite policy analysis. In Acosta’s view, “the federal responsibility” in this unique situation was merely to serve as a “back- stop [to] state authorities to ensure that there [was] no miscarriage of justice.”247 Acosta told OPR that he understood the PBPD would not have brought Epstein to the FBI’s attention if the State Attorney had pursued charges that required Epstein’s incarceration. Acosta therefore decided that the USAO could avert a “manifest injustice” by forcing the state to do more and require Epstein to serve time in jail and register as a sexual offender. Acosta’s reasoning was flawed and unduly constricted. Acosta’s repeated references to a “miscarriage of justice” or “manifest injustice” echoes the “manifestly inadequate” language used in the Petite policy to define the circumstances in which the federal government may proceed with a criminal case after a completed state prosecution. Nothing in the Petite policy, however, requires similar restraint when the federal government pursues a case in the absence of a completed state prosecution, even if the state is already investigating the same offense. The goal of the Petite policy is to prevent multiple prosecutions for the same offense, not to compel the federal government to defer to a parallel state interest in a case, particularly one in which state officials involved in the state prosecution expressed significant concerns about it, and there were questions regarding the state prosecutor’s commitment to the case. Acosta told OPR that “there are any number of instances where the federal government or the state government can proceed, and state charges are substantially less and different, and . . . the federal government . . . stands aside and lets the state proceed.” The fact that the federal government can allow the state to proceed with a prosecution, however, does not mean the federal government is compelled to do so, particularly in a matter in which a distinct and important federal interest exists. Indeed, the State Attorney told OPR that the federal government regularly takes over cases initiated by state investigators, typically because federal charges result in “the best sentence.” Epstein was facing a substantial sentence under the federal sentencing guidelines.248 Despite the Ashcroft Memo’s directive that federal prosecutors pursue “the most serious readily provable offense,” Acosta’s decision to push “the state to do a little bit more” does not approach that standard. In fact, Acosta conceded during his OPR interview that the NPA did not represent an “appropriate punishment” in the federal system, nor even “the best outcome in the state system,” and that if the investigation of Epstein had originated with the FBI, rather than as a referral from the PBPD, the outcome might have been different. As U.S. Attorney, Acosta had the authority to 247 Letter from R. Alexander Acosta “To whom it may concern” at 1 (Mar. 20, 2011), published online in The Daily Beast. 248 Villafaña estimated that the applicable sentencing guidelines range was 168 to 210 months’ imprisonment.

173 depart from the Ashcroft Memo. He told OPR, however, that he did not recall discussing the Ashcroft Memo with his colleagues and nothing in the contemporaneous documentary record suggests that he made a conscious decision to depart from it when he decided to resolve the federal investigation through the NPA. Instead, it appears that Acosta simply failed to consider the tension between federal charging policy and the strong federal interest in this case, on the one hand, and his broad reading of the Petite policy and his general concerns about “federalism,” on the other hand. OPR concludes that Acosta viewed the federal government’s role in prosecuting Epstein too narrowly and through the wrong prism. Furthermore, Acosta’s federalism concerns about intruding on the state’s autonomy resulted in an outcome—the NPA—that intruded far more on the state’s autonomy than a decision to pursue a federal prosecution would have.249 By means of the NPA, the federal government dictated to the state the charges, the sentence, the timing, and certain conditions that the state had to obtain during the state’s own prosecution. Acosta acknowledged during his OPR interview that his “attempt to backstop the state here[] rebounded, because in the process, it . . . ended up being arguably more intrusive.” Acosta’s concern about invading the state’s authority led to additional negative consequences. Acosta revised the draft NPA in several respects to “soften” its tone, by substituting provisions requiring Epstein to make his “best efforts” for language that appeared to dictate certain actions to the state. In so doing, however, Acosta undermined the enforceability of the agreement, making it difficult later to declare Epstein in breach when he failed to comply. OPR found no indication that when deciding to resolve the federal prosecution through a mechanism that relied completely on state action, Acosta considered the numerous disadvantages of having Epstein plead guilty in the state court system, a system in which none of the subjects had practiced and with which they were unfamiliar. Villafaña recognized that there were “a lot of ways to manipulate state sentences,” and she told OPR that she was concerned from the outset of negotiations about entering into the NPA, because by sending the case back to the state the USAO was “giving up all control over what was going on.” Villafaña also told OPR that defense counsel “had a lot of experience with the state system. We did not.” Epstein’s ability to obtain work release, a provision directly contrary to the USAO’s intent with respect to Epstein’s sentence, is a clear example of the problem faced by the prosecutors when trying to craft a plea that depended on a judicial system with which they were unfamiliar and over which they had no control. Although the issue of gain time was considered and addressed in the NPA, none of the subject attorneys negotiating the NPA realized until after the NPA was signed that Epstein might be eligible for work release. Acosta, in particular, told OPR that “if it was typical to provide that kind of work release in these cases, that would have been news to me.” Because work release was not anticipated, the NPA did not specifically address it, and the USAO was unable to foreclose Epstein from applying for admission to the program. 249 The Petite policy only applies to the Department of Justice and federal prosecutions. It does not prevent state authorities from pursuing state charges after a federal prosecution. See, e.g., United States v. Nichols and State v. Nichols (dual prosecution for acts committed in the bombing of the Oklahoma City federal building). However, in practice and to use their resources most efficiently, state authorities often choose not to pursue state charges if the federal prosecution results in a conviction.

174 The sexual offender registration provision is yet another example of how Acosta’s decision to create an unorthodox mechanism that relied on state procedures to resolve the federal investigation led to unanticipated consequences benefitting Epstein. Acosta told OPR that one of the core aspects of the NPA was the requirement that Epstein plead guilty to a state charge requiring registration as a sexual offender. He cited it as a provision that he insisted on from the beginning and from which he never wavered. However, the USAO failed to anticipate certain factors that affected the sexual offender registration requirement in other states where Epstein had a residence. In selecting the conduct for the factual basis for the crime requiring sexual offender registration, the state chose conduct involving a victim who was at least 16 at the time of her interactions with Epstein, even though Epstein also had sexual contact with a 14-year old victim. The victim’s age made a difference, as the age of consent in New Mexico, where Epstein had a residence, was 16; therefore, Epstein was not required to register in that state. As a 2006 letter from defense counsel Lefcourt to the State Attorney’s Office made clear, the defense team had thoroughly researched the details and ramifications of Florida’s sexual offender registration requirement; OPR did not find evidence indicating similar research and consideration by the USAO. Finally, Acosta was well aware that the PBPD brought the case to the FBI’s attention because of a concern that the State Attorney’s Office had succumbed to “pressure” from defense counsel. Villafaña told OPR that she informed both Acosta and Sloman of this when she met with them at the start of the federal investigation. Although Acosta did not remember the meeting with Villafaña, he repeatedly told OPR during his interview that he was aware that the PBPD was dissatisfied with the State Attorney’s Office’s handling of the case. Shortly before the NPA was signed, moreover, additional information came to light that suggested the State Attorney’s Office was predisposed to manipulating the process in Epstein’s favor. Specifically, during the September 12, 2007 meeting, at the state prosecutor’s suggestion, the USAO team agreed, with Acosta’s subsequent approval, to permit Epstein to plead guilty to one state charge of solicitation of minors to engage in prostitution, rather than the three charges the USAO had originally specified. The state prosecutor assured Lourie that the selected charge would require Epstein to register as a sexual offender. Shortly thereafter, the USAO was told by defense counsel that despite the assurances made to Lourie, the state prosecutor had advised Epstein—incorrectly, it turned out—that a plea to that particular offense would not require him to register as a sexual offender. Yet, despite this evidence, which at least suggested that the state authorities should not have been considered to be a reliable partner in enforcing the NPA, Acosta did not alter his decision about proceeding with a process that depended completely on state authorities for its successful execution. OPR finds that Acosta was reasonably aware of the facts and circumstances presented by this case. He stated that he engaged in discussions about various aspects of the case with Sloman and Menchel, and relied upon them for their evaluation of the legal and evidentiary issues and for their assessment of trial issues. Acosta was copied on many substantive emails, reviewed and revised drafts of the NPA, and approved the final agreement. Yet, rather than focusing on whether the state’s prosecution was sufficient to satisfy the federal interest in prosecuting Epstein, Acosta focused on achieving the minimum outcome necessary to satisfy the state’s interest, as defined in part by the state’s indictment, by using the threat of a federal prosecution to dictate the terms of