Jeffrey Epstein was a frequent backer of real estate ventures and investments, wagering millions on Manhattan condo projects, private clubs and hotels.
But in Palm Beach, he and his partners gambled and lost. Files released by the federal government this year uncovered Epstein’s failed flip of a lakefront home on the island as part of a partnership with Paul Prosperi –– the late disgraced attorney, convicted fraudster and friend to former President Bill Clinton.
The emails between Epstein and Prosperi reveal Epstein as a serial follower of Palm Beach real estate in the years following the global financial crisis, when major deals showed glimmers of the gilded future a decade down the road. Ken Griffin was beginning his estate assemblage, and other prominent billionaires were beginning to sniff around at major acquisitions.
It’s unknown based on the files when Prosperi and Epstein met, but their financial relationship began as early as 2009, when Epstein provided Prosperi a loan to buy an apartment in Palm Beach, documents show. Prior to that, Prosperi visited Epstein at least 20 times during his first jail sentence in 2008 and 2009, according to CNBC. Prosperi began approaching Epstein with proposed real estate deals in 2010, emails show. Epstein would bring the money, and Prosperi would execute the deals, collecting a fee.
But who was Prosperi?
The communications between him and Epstein reveal a troubled man with failing health, who struggled with an autoimmune disorder.
Prosperi attended Georgetown University, where he ran the student body presidential campaign of his friend Bill Clinton. After graduating, he became a Palm Beach real estate attorney and fundraiser for the Clintons, rising in prominence in South Florida society.
That was until 1996, when he was indicted on charges of embezzlement and tax fraud. He was found guilty of siphoning $1.8 million from the accounts of an elderly client, and failing to report it in his tax returns.
“He was nothing more than a thief with a law degree,” then-Assistant U.S. Attorney Stephen Carlton told the South Florida Sun Sentinel.
He faced years in prison after a 1997 conviction, until Clinton commuted his sentence in the final hours of his presidency, according to published reports.
Disbarred, Prosperi found himself back in Palm Beach and in need of income.
Dozens of emails over the years show Prosperi as the go-between for Epstein and Palm Beach real estate’s top brokers, relaying market insights and intel on deals.
He presented Epstein with a number of deals over the years, including one to provide emergency financing for spec developer Dan Swanson, who owed $26.6 million on an estate he had listed for $64.9 million in 2011, and another to flip the home of the late Gertrude Maxwell.
But the files only show one deal Epstein funded.
In December 2013, Prosperi emailed Epstein with the details of a small lakefront house at 124 Parc Monceau, on the south end of the island. He had secured a short-term right to buy the quarter-acre property at just under $5 million. With a little bit of work, he figured, it could be flipped for $7 million.
“I think (and Moens, McCann, Frisbie and Koch concur) that this is well under land value ($6M+),” Prosperi wrote, namedropping a slate of the market’s top brokers to bolster his assessment. “Would you be willing to help?”
Epstein agreed, providing $5 million to acquire the house. The deal closed in January 2014, according to property records.
“The purchase of the house has closed. Thank you for making the investment,” Prosperi wrote to Epstein that day.
But the deal hid Epstein’s involvement with the LLC that acquired the house registered to attorneys. What was meant to be a quick flip turned into a two-year ordeal, detailed in frequent communications between Epstein and Prosperi about the state of the home and the Palm Beach housing market.
Epstein chastised Prosperi in a dashed-off email after visiting the house in September 2014: “dont fret, however, it was a pig sty, no reason at all, at all for broken furniture … filthy walls. rust stained walls … shame on us.”
Documents show they drafted a listing agreement with Lawrence Moens, one of the island’s top brokers, in February 2015. A representative for Moens said he did not know Epstein was involved in the property, and that he believed Prosperi to be the true owner of the home.
By May of that year, Epstein was expressing frustration with the status of his investment.
“I guess , we have not done well this season. no bids,” he wrote.
Beginning in January 2016, the partners gave the listing to Kerry Warwick and Richard Steinberg, agents with Douglas Elliman at the time. Epstein’s lieutenants insisted on frequent updates about showings and listings, until Donna Ward, the wife of financier Rodney Ward, put in an offer. (Warwick, later licensed with the Corcoran Group, would go on to list Epstein’s Palm Beach house for sale after his death.)
Records show Ward closed on the home in April 2016, for $5.6 million –– on paper, a $600,000 gain for the investors. But a breakdown on the project’s financials sent by Epstein’s longtime accountant Richard Kahn shows the partners invested $5.7 million into 124 Parc Monceau, which means they lost at least $100,000.
It was complicated by Prosperi’s death a month prior, revealing an estate in shambles and significant debts.