Howard Rubin charged with intercourse trafficking

Former Salomon Brothers bond dealer Howard Rubin and his former private assistant have been arrested Friday morning on prices of intercourse trafficking and transporting ladies throughout state strains for industrial intercourse acts over the course of a decade.

Prosecutors alleged a litany of stomach-churning, abusive acts in opposition to ladies by the 70-year-old Rubin, who first gained infamy within the Nineteen Eighties with an unauthorized commerce that value his then-firm tens of hundreds of thousands in losses.

A federal Justice of the Peace choose in Brooklyn, New York, later Friday ordered Rubin detained with out bail, for now, after prosecutors argued he was a flight danger, and that he had mentioned hiring a “hit man to focus on ladies who had filed a civil go well with in opposition to him.”

Prosecutors additionally cited the Wall Streeter’s alleged prior makes an attempt at witness intimidation, and stated that the victims within the case are “universally” afraid of him earlier than Justice of the Peace Choose Peggy Kuo rejected Rubin’s bid to be launched on a $25 million bond.

Rubin participated in intercourse acts with the ladies in luxurious inns in New York, and later rented a two-bedroom penthouse house in Manhattan that was transformed right into a so-called “intercourse dungeon” outfitted with bondage, self-discipline, dominance, submission and sadomasochism tools, in addition to soundproofing, a 10-count indictment alleges.

The tools allegedly included a tool to “shock or electrocute ladies,” prosecutors stated.

“Throughout many such encounters, Rubin engaged in conduct past the scope of the ladies’s consent,” the indictment in U.S. District Court docket in Brooklyn, New York, alleges.

“Throughout many of those encounters, Rubin brutalized ladies’s our bodies, inflicting them to worry for his or her security and/or leading to vital ache or accidents, which at instances required ladies to hunt medical consideration,” the indictment prices.

The previous Soros Fund Administration financier and his ex-personal assistant, Jennifer Powers, 45, spent at the least $1 million of Rubin’s cash “working and sustaining the trafficking community,” which lasted from at the least 2009 by way of 2019, the indictment stated.

Rubin was arrested by FBI brokers at his residence in Fairfield, Connecticut.

He pleaded not responsible throughout his look Friday afternoon in Brooklyn, which was delayed by a medical incident that led to him being evaluated at a hospital.

Prosecutors stated there at the least 10 different individuals who helped Rubin facilitate his alleged crimes, cited tax paperwork that they argued indicated his monetary crimes continued till his arrest.

They stated Rubin was discovered with eight cell telephones and three BlackBerry units. He wouldn’t reveal the place his passport was, and didn’t give up it when arrested.

Rubin’s lawyer argued he was not a flight danger as a result of two of his grownup kids and his grandchildren reside close to him.

The lawyer additionally cited Rubin’s well being situation, saying he had a stroke in July.

Kuo rejected that argument, however Rubin’s protection staff might make a brand new bail software. He’s subsequent scheduled to be in courtroom on Oct. 20.

Powers was arrested at her residence in Soutlake, Texas, and is scheduled to look in U.S. District Court docket for the Northern District of Texas subsequent week. She can be charged with financial institution fraud in reference to alleged misrepresentations she made to a financial institution whereas financing the mortgage for her and her husband’s residence in Southlake, Texas, authorities stated.

Prosecutors in a letter to Choose Kuo requested that Rubin be held with out bail, “as a result of no situation or mixture of situations can moderately safe Rubin’s look in courtroom as required or the protection of the group.” The letter famous that he had “extraordinary wealth, a few of which is held in accounts abroad.” In 2024, Rubin had greater than $74 million in a Cayman Islands account, the letter stated.

Prosecutors desire a “substantial bail bundle” for Powers.

Rubin was sued in November 2017 by two self-identified Playboy fashions and one other mannequin from Florida, who claimed they have been crushed, sexually abused and raped by Rubin in a number of incidents in New York Metropolis in 2016.

In April 2022, a civil jury in Brooklyn federal courtroom discovered Rubin answerable for intercourse trafficking six ladies who had sued him and Powers, and ordered him to pay them a complete of $3.85 million in compensatory and punitive damages. Powers was not discovered liable by that jury.

Rubin is at present interesting the civil judgment.

A spokesman for the U.S. Legal professional’s Workplace in Brooklyn had no remark when requested why there was a lag of almost eight years between the submitting of the civil lawsuit in opposition to Rubin and the workplace acquiring a legal indictment in opposition to him. On the time the lawsuit was filed, a lawyer for girls who sued Rubin informed CNBC that the U.S. Legal professional’s Workplace had reached out to him about probably investigating the financier.

The detention letter by prosecutors says that after Rubin was sued, he informed a girl whom he had seen for industrial intercourse from 20014 by way of to 2019, “that pursuant to his preparations, a hitman was contacted on the darkish net to focus on ladies who had filed a civil go well with in opposition to him, however he didn’t in the end retain the hitman.”

Rubin, after working as a bond dealer at Salomon Brothers, additionally did stints at Bear, Stearns and Merrill Lynch.

He first gained public notoriety in 1987 for making unauthorized trades at Merrill Lynch, which the agency on the time stated contributed to an enormous $250 million loss from mortgage securities. Rubin’s motion at Merrill, which led to his termination, is detailed in Michael Lewis’ Wall Avenue memoir “Liar’s Poker.”

Powers is accused within the indictment of facilitating Rubin’s industrial sexual encounters from at the least 2011 by way of 2019, allegedly recruiting ladies to journey to New York and paid for his or her acts with Rubin, in addition to managing “the fallout from ladies’s complaints” stemming from these acts.

CNBC has requested remark from Rubin’s lawyer, Michael Gilbert, and from Powers’ lawyer.

The indictment alleges the intercourse trafficking of six ladies, a few of whom have been additionally recognized as ladies who have been transported throughout state strains with the intent to have interaction in prostitution, in violation of the Mann Act.

“Rubin and Powers required the ladies to signal non-disclosure agreements … which presupposed to require the ladies to imagine the chance of the hazards and harm of the BDSM encounters with Rubin, prohibit the disclosure of details about the BDSM intercourse with Rubin and require the cost of damages within the occasion of a breach,” the Brooklyn U.S. Attonrney’s Workplace stated in an announcement.

“Rubin used the NDAs to threaten the ladies with authorized penalties and public shaming in the event that they sought authorized recourse,” the workplace stated.

Prosecutors of their letter to the choose stated that “Rubin and Powers saved a stash of clean NDAs in a protected within the Penthouse, which they required ladies to signal.”

“Ladies weren’t supplied with a duplicate of the NDAs earlier than being required to signal,” prosecutors wrote. “Ladies have been required to attest that they weren’t underneath the affect of medicine or alcohol on the time of signing, when at instances that they had been supplied with alcohol and/or medication by Rubin, Powers or their co-conspirators earlier than being offered the NDA.”

The workplace additionally stated that after Rubin’s alleged sexual encounters with ladies, “Rubin and/or Powers used Rubin’s cash to pay the ladies by wire switch or a cost service resembling PayPal or Venmo.”

“At instances, Powers structured the funds to keep away from sending a single transaction of $10,000 or extra, to keep away from triggering reporting obligations by the financial institution,” the workplace stated. “The indictment alleges the defendants spent at the least $1 million of Rubin’s cash working and sustaining the trafficking community.”

If convicted of intercourse trafficking, Rubin and Powers every face a most doable sentence of life in jail and a compulsory minimal sentence of 15 years in jail.

“As alleged, the defendants used Rubin’s wealth to mislead and recruit ladies to have interaction in industrial intercourse acts, the place Rubin then tortured ladies past their consent, inflicting lasting bodily and/or psychological ache, and in some circumstances bodily accidents,” Brooklyn U.S. Legal professional Joseph Nocella stated in an announcement.

“Right this moment’s arrests present that nobody who engages in intercourse trafficking, on this case in luxurious inns and a penthouse house that featured a so-called intercourse ‘dungeon,’ is above the regulation, and that they are going to be delivered to justice,” Nocella stated.

“Human beings aren’t chattel to be exploited for intercourse and sadistically abused, and anybody who thinks in any other case can look forward to finding themselves in handcuffs and going through federal prosecution like these defendants,” he stated.

— CNBC’s Mallory Leonard and Jim Forkin contributed to this story