Financier Howard Rubin charged with sex trafficking

Famed former Salomon Brothers bond trader Howard Rubin and his former personal assistant were arrested Friday morning on charges of sex trafficking and transporting women across state lines for commercial sex acts over the course of a decade.

Rubin, 70, participated in sex acts with the women in luxury hotels in New York, and later, a rented two-bedroom penthouse apartment in Manhattan that was converted into a so-called “sex dungeon” outfitted with bondage, discipline, dominance, submission and sadomasochism equipment, as well as soundproofing, a 10-count indictment alleges.

The equipment allegedly included a device to “shock or electrocute women,” prosecutors said.

“During many such encounters, Rubin engaged in conduct beyond the scope of the women’s consent,” the indictment in U.S. District Court in Brooklyn, New York, alleges.

“During many of these encounters, Rubin brutalized women’s bodies, causing them to fear for their safety and/or resulting in significant pain or injuries, which at times required women to seek medical attention,” the indictment charges.

The former Soros Fund Management financier and his ex-personal assistant, Jennifer Powers, 45, spent at least $1 million of Rubin’s money “operating and maintaining the trafficking network,” which lasted from between at least 2009 through 2019, the indictment said.

Rubin was arrested by FBI agents at his home in Fairfield, Connecticut. He is scheduled to be arraigned on Friday afternoon in Brooklyn federal court.

Prosecutors in a letter to Judge Kuo asked that Rubin be held without bail, “because no condition or combination of conditions can reasonably secure Rubin’s appearance in court as required or the safety of the community.”

Rubin was sued in 2017 by two self-identified Playboy models and another model from Florida, who claimed they were beaten, sexually abused and raped by Rubin in multiple incidents in New York City in 2016.

In April 2022, a civil jury in Brooklyn federal court found Rubin liable for sex trafficking six women who had sued him and Powers, and ordered him to pay them a total of $3.85 million in compensatory and punitive damages. Powers was not found liable by that jury.

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

He first gained public notoriety in 1987 for making unauthorized trades at Merrill Lynch, which the firm at the time said contributed to a massive $250 million loss from mortgage securities. Rubin’s action at Merrill, which led to his termination, is detailed in Michael Lewis’ Wall Street memoir “Liar’s Poker.”

Powers was arrested in Texas and is scheduled to appear in U.S. District Court for the Northern District of Texas. She is also charged with bank fraud in connection with alleged misrepresentations she made to a bank while financing the mortgage for her and her husband’s home in Southlake, Texas, authorities said.

Powers is accused in the indictment of facilitating Rubin’s commercial sexual encounters from at least 2011 through 2019, allegedly recruiting women to travel to New York and paid for their acts with Rubin, as well as managing “the fallout from women’s complaints” stemming from those acts.

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

The indictment alleges the sex trafficking of six women, some of whom were also identified as women who were transported across state lines with the intent to engage in prostitution, in violation of the Mann Act.

“Rubin and Powers required the women to sign non-disclosure agreements … which purported to require the women to assume the risk of the hazards and injury of the BDSM encounters with Rubin, prohibit the disclosure of information about the BDSM sex with Rubin and require the payment of damages in the event of a breach,” the Brooklyn U.S. Attonrney’s Office said in a statement.

“Rubin used the NDAs to threaten the women with legal consequences and public shaming if they sought legal recourse,” the office said.

Prosecutors in their letter to the judge said that “Rubin and Powers kept a stash of blank NDAs in a safe in the Penthouse, which they required women to sign.”

“Women were not provided with a copy of the NDAs before being required to sign,” prosecutors wrote. “Women were required to attest that they were not under the influence of drugs or alcohol at the time of signing, when at times they had been provided with alcohol and/or drugs by Rubin, Powers or their co-conspirators before being presented the NDA.”

The office also said that after Rubin’s alleged sexual encounters with women, “Rubin and/or Powers used Rubin’s money to pay the…