ST. THOMAS, Virgin Islands _ The fate of a proposed multimillion-dollar fund intended to provide compensation to the victims of disgraced financier Jeffrey Epstein remained in doubt Tuesday as a probate judge in the U.S. Virgin Islands said she needed more information and time to evaluate the legality of the process.
Also on the table but left unresolved: the multimillion-dollar cut sought for lawyers who are administrators of the Epstein estate.
The judge said it is unclear how much room she has to maneuver after Virgin Islands Attorney General Denise George last month hit Epstein's estate with a lien for alleged criminal activity _ effectively freezing all of his assets beyond basic bills coming due.
The dramatic case unfolding in the sun-kissed Virgin Islands pits the U.S. territory _ where Epstein established numerous shell companies that hid his identity and helped him acquire two private islands _ against the executors of the late financier's estate and lawyers for his victims, who conceptually support the voluntary compensation fund.
Epstein, who died by reported suicide last Aug. 10, made the Virgin Islands his main residence after serving a short jail sentence in 2008-09 following a highly controversial deal with federal prosecutors. In the U.S. territory, the registered sex offender enjoyed lucrative tax breaks doled out by successive island governments.
The court must decide whether the Virgin Islands can seize the two private islands bought by Epstein, and whether the U.S. territory gets first crack at his money over his alleged victims.
Although Probate Court Judge Carolyn Hermon-Percell said she would approve legal fees and costs directly associated with administering Epstein's estate, she was worried about the expenses related to setting up a victims' compensation fund like those proposed by executors last November.
An open-ended compensation program, she said, might drain his estate before the government of the U.S. Virgin Islands can make its case.
"The government is concerned that you could start paying out settlements and when the government's turn comes there's nothing left," she said.
She implored the attorney general and executors of Epstein's estate to meet quickly.
"I'm sure you can work something out," Hermon-Percell said.
Acclaimed attorney David Boies, who represents about a dozen of Epstein's victims, said the lien by the U.S. Virgin Islands seems misplaced.
"I have to believe that the government of the Virgin Islands is going to want to see the victims compensated," Boies said outside the courtroom. "It seems to me that the victims are the most deserving and should be at the front of the line _ not at the back of the line."
Epstein's estate was valued at more than $550 million at the time of his death in August. Since then, that number has gone up by more than $50 million as investments grew and lawyers reworked their initial evaluation of his assets. Lawyers settling the estate argue that there is enough money to cover legal fees, establish and operate the victims' compensation fund and guarantee generous restitution to Epstein's victims.
Without the fund, however, they said they will have to litigate on a case-by-case basis, running up court costs and increasing the pain for the now-grown women who allege they were sexually abused and exploited by Epstein, some when they were very young teens.
While more than two dozen women have already come forward, lawyers said there could be as many as 50 who might qualify for compensation. None was in the courtroom Tuesday, although Epstein accuser Courtney Wild was invited by California Democratic Rep. Jackie Speier to be her guest during President Donald Trump's State of the Union address Tuesday night.
Ariel M. Smith, chief of the civil division of the U.S. Virgin Islands Department of Justice, said it is "premature" to establish the fund when Epstein's representatives have still not provided a comprehensive inventory of his belongings. And she suggested his executors are trying to obfuscate by submitting redacted financial statements as they run up legal fees.
"We are worried that they will ultimately dissipate the estate," she said. "I am concerned about what would appear to be a pattern of conduct."
Andrew Tomback, a lawyer for Epstein's estate and a partner in the New York office of White & Case, said in a testy exchange that the government's attempt to seize and freeze all of Epstein's property threatens to derail justice.
"I get that she wants everything," he said of the attorney general's action. She wants to "take all the money, block the program and gum up the system."
Hermon-Percell said she understands that a voluntary program would benefit all parties, but she seemed disturbed by the legal team's reluctance to provide a clear breakdown of the program's costs.
As Tomback and others talked about the merits of the fund, Hermon-Percell repeatedly interrupted them with a simple question: "I want to know about the money."
"The government is concerned about how much money is being spent to set up the program," she said. "Rent, salaries _ just the cost of setting it up."
Pressed on that issue, Tomback listed some of the biggest expenses. The attorney who designed the program would be paid $1.7 million, and the proposed administrator, Jordy Feldman, would be paid $150,000 per month for the 12- to 14-month duration of the victims' compensation fund. Office rental expenses were estimated at $150,000 to $250,000 for the life of the project.
Joshua G. Schiffer, an attorney with ChancoSchiffer P.C., representing some Epstein victims, pointed to last weekend's Super Bowl teams and said that the executors picking a compensation fund manager is as if "one of them sponsored the referee or the referee's position."
Feldman, who previously worked with the federal fund that compensated victims of the 9/11 terrorist attacks, said a voluntary program is the most compassionate and efficient way to give back to victims _ saving them the trauma of lengthy and uncertain court battles.
Under the proposed program, there would be no limit to what victims might be compensated, and she said the settlements would likely range from thousands of dollars to millions of dollars.
"Victims long for validation as much as compensation," she said. "It's impossible not to prioritize the victims in this case."
Feldman also pushed back against the idea that the compensation fund would be beholden to the estate and its lawyers, saying her program, once established, would be completely independent.
"We are not here to do their bidding," she said.
In the end, Hermon-Percell suggested she wanted to find a way to "carve" out an exception to the lien to finance the victims' compensation fund. And she asked lawyers to present arguments and guidance within the next seven days to justify funding the program.
"I really agree that the program will save time, money and especially attorneys' fees," she said.
But she also said the state had tied her hands.
"The attorney general has taken out a lien on everything," she said.
Also getting attention in the courtroom was a previously unknown Epstein company called Southern Company International, Ltd. The Miami Herald reported on Monday that the mysterious company received $15.5 million from the Epstein estate, and corporate documents in the Virgin Islands did not say what it did.
Lawyers for the estate said Tuesday some of that payment was an error, but a New York Times story late Tuesday said Southern Company International was a specialized bank that is the first of its kind in the territory and is allowed to do business only with offshore clients. The Times published its bank license certificate, which didn't fully disclose his sex-offender status.
As of Tuesday, the island's Department of Licensing public-facing website still did not show any record of Southern International Company as a licensed banking entity.
