Christina Kelly is walking back her lurid accusations of illegal drug use and debauchery by senior Jefferies bankers with clients.
Kelly made the salacious claims in a divorce and child custody battle with her husband, Sage Kelly. The allegations—which were supposed to be kept private per court rules—led to a flood of publicity and put Jefferies and two of its biotech company clients on the defensive as they strongly denied the accounts.
Now the estranged Wall Street wife is changing her position as part of a custody agreement.
"A substantial portion of what has been written in the press and other media over the past few weeks is inaccurate, untrue, or hyperbolic, and I apologize to those who have been affected thereby—including those at Jefferies and those associated with Jefferies," Kelly said in a statement, according to multiple media reports.
"The presentation of facts in divorce proceedings is a function of subjective viewpoints," she added in the text. "When a person's statements in a divorce proceeding become public, there is a danger that the publication of those statements can create misimpressions that, regrettably can cause unintended harm to innocent individuals."
It wasn't clear which allegations she said weren't true. Lawyers for Christina Kelly and Sage Kelly didn't respond to requests for comment. A Jefferies spokesman also didn't return an email seeking a reaction. Sage Kelly is on voluntary leave from the firm.
Jefferies took the unusual step of posting a public rebuttal to Kelly's claims by CEO Rich Handler and chairman Brian Friedman. "This past week has been beyond painful for us, as a child-custody case has led to groundless questions about the integrity of our firm," the letter said.
Handler and Friedman also noted in the memo that they and other members of the investment banking teams mentioned in the original filing, including division head Ben Lorello, had taken and passed drug tests.
"To be frank, we are embarrassed that we even have to discuss these matters, but this should put to rest the heart of the allegations about our firm," the letter said. "Sometimes truth does come in a jar."