Epstein's Former Business Associate Says He Committed Financial Crimes Too Steven Hoffenberg spent 18 years in prison for running a Ponzi scheme. He says his former business partner Jeffrey Epstein should have been there too.
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Jeffrey Epstein's Former Business Associate: I Want To Assist Victims

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Jeffrey Epstein's Former Business Associate: I Want To Assist Victims

Jeffrey Epstein's Former Business Associate: I Want To Assist Victims

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Jeffrey Epstein has also been accused of other crimes. One of his former business partners says Epstein got away with financial crimes. Steven Hoffenberg spent 18 years in prison for running a Ponzi scheme. And he says Epstein was complicit in those crimes but was never prosecuted. NPR's Jim Zarroli reports.

JIM ZARROLI, BYLINE: At 74, Steven Hoffenberg spends a lot of time reflecting on his long and disreputable past. And these days, one person on his mind is Jeffrey Epstein.

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STEVEN HOFFENBERG: There's so much going through my mind about me and Epstein. It's a lifetime of errors. How do you correct a lifetime of errors?

ZARROLI: Hoffenberg spoke this week by telephone from his hospital bed, where he was preparing for surgery. In the 1980s, Hoffenberg ran a company called Towers Financial. Around that time, he says, a British business acquaintance introduced him to Epstein. Hoffenberg says he was immediately impressed.

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HOFFENBERG: He appeared to be brilliant, extraordinarily gifted and talented in convincing people to buy from him and a criminal mastermind.

ZARROLI: Hoffenberg says he hired Epstein, and they became very close. Hoffenberg became a kind of mentor to him. Epstein helped him raise money on Wall Street.

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HOFFENBERG: He knew many people in the brokerage business that sold securities, and they gave him access to investors.

ZARROLI: And he says the two of them conspired in the scheme that would later send Hoffenberg to prison. Hoffenberg's firm acquired the parent company of two Illinois insurance companies. Then, he says, they used the company's money to launch a failed attempt to buy the airline Pan Am. He says they also drained hundreds of millions of dollars from Towers Financial investors for personal use. Hoffenberg acknowledges his role in the scheme.

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HOFFENBERG: This was a criminal investment enterprise, so I'm not trying to state to you that there was a purpose that should be complimented.

ZARROLI: Hoffenberg would plead guilty in 1995 to mail fraud, tax evasion and obstruction of justice. He says he told federal prosecutors about Epstein's role in the scheme.

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HOFFENBERG: There is no question that I told him. Makes no sense. Like, his whole life makes no sense. His death makes no sense.

ZARROLI: But Epstein would never be charged. Why that is remains unclear. The federal prosecutor who handled the matter declined to discuss it, saying he never comments on past cases.

One former prosecutor who did speak was Amy Millard who's now in private practice at the law firm Clayman & Rosenberg. She came into the case late. And 25 years later, she doesn't remember a whole lot about it. But she says Hoffenberg didn't exactly seem like a trustworthy witness.

AMY MILLARD: I remember that at the point that I met him and having dealings with him, I did not believe that he was credible in his statements.

ZARROLI: Millard says thousands of people who had put money in Towers Financial were hurt when the firm declared bankruptcy after Hoffenberg was charged, and Hoffenberg's demeanor in the courtroom seemed less than sympathetic.

MILLARD: He was extraordinarily arrogant, not taking responsibility for what he had done and that there were a huge number of victims who were hurt by his behavior.

ZARROLI: Now out of prison, Hoffenberg acknowledges that his crimes cost a lot of people their retirement savings. Before Epstein's death, he says, he actually called some of the victims of his fraud. He told them Epstein had walked away with money from the fraud, and Hoffenberg encouraged the victims to sue Epstein. He even offered to testify on their behalf.

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HOFFENBERG: I'm the first one in line to assist the victims. At 74, I'd like to go to the pearly gates assisting the victims.

ZARROLI: One of the victims he contacted did file a class action suit against Epstein last year, and Hoffenberg sued Epstein himself. But Epstein's attorneys argued that the statute of limitations had run out on whatever crimes were committed. And the suits were later withdrawn.

Jim Zarroli, NPR News, New York.

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