The EDC Program
The U.S. Virgin Islands’ Economic Development Commission program was designed to attract investment and employment to the territory by offering substantial tax incentives to qualifying businesses. Companies certified under the EDC program could receive reductions in local income taxes, reductions in gross receipts taxes, and exemptions from certain customs duties. The program was intended to benefit the territory’s residents through job creation and economic activity.
Epstein established multiple entities in the USVI — principally Liquid Funding Ltd. and Financial Trust Company Inc. — and sought and received EDC certification for them. This gave him substantial tax advantages on income that flowed through his offshore and USVI-based structures, saving him millions of dollars over the period the certification was in effect.
Mechanics of the Alleged Fraud
The USVI government’s 2020 civil lawsuit against Epstein’s estate, filed by Attorney General Denise George before she was controversially dismissed, alleged that the EDC certifications were obtained by misrepresenting the nature and extent of the USVI operations. The suit contended that the businesses did not create meaningful local employment, did not conduct substantial genuine commercial activity in the territory, and were effectively hollow entities designed to route money through USVI for tax advantages without delivering the economic development the EDC program required.
In exchange for the EDC certification, Epstein allegedly made payments to connected officials and facilitated relationships that helped secure favorable treatment. The suit alleged this constituted fraud on the USVI government and sought disgorgement of the improperly obtained tax benefits plus additional damages.
The Dismissal of Denise George
Attorney General Denise George, who filed the USVI lawsuit against Epstein’s estate in late 2020, was abruptly fired by USVI Governor Albert Bryan Jr. in January 2021 — just days after filing the suit. The firing raised immediate questions, particularly given allegations in the complaint that Epstein’s operation had corrupted local officials. Governor Bryan stated the firing was unrelated to the Epstein litigation; critics and some legal commentators questioned that explanation. George’s successor continued the litigation.
Settlement and Outcomes
The USVI government’s lawsuit against Epstein’s estate was settled in 2024. The estate agreed to pay $105 million to the USVI to resolve claims including fraudulent EDC certifications, labor trafficking of workers on the island, and related violations. The settlement was among the largest in the litigation arising from Epstein’s estate.
Separately, the USVI filed a lawsuit against JPMorgan Chase, alleging that the bank facilitated Epstein’s USVI operations including the payments and financial flows associated with his tax structure. That litigation was also settled, with JPMorgan paying $75 million to the USVI.
Implications
Epstein’s use of the USVI EDC program illustrates a broader pattern in his financial structure: leveraging legitimate government programs through misrepresentation to extract financial benefit. The same approach appeared in his use of corporate shell entities in other jurisdictions. The USVI case also illustrated the potential for local government corruption to enable and sustain criminal financial structures, a theme that ran through multiple aspects of the Epstein investigation.