Chapter 12
The Embezzlement
Looking at my watch as I listened to Don's story, I saw it was already ten. It was time to go. I had promised Rebekah I'd be home, but the story wasn't over. The worst was yet to come and I had to hear it all--every tragic detail of the rise and demise of Don and Pam Blaylock. They had become my friends and I felt sicker and sicker as the night waned.
Don cleared his throat. I looked over at him and smiled. He continued his story.
"After Luther had gone through the franchise training school, he admitted to us he still didn't have the knowledge or experience necessary to operate the restaurant."
"Oh, great. I bet that pissed you off," I said.
He nodded. "That's an understatement, but by that time we already knew Luther was incompetent, so we agreed to hire an experienced assistant manager who could handle most of the day to day management chores."
"How do you find a manager for a restaurant?" I asked.
"Luther took out an ad in the Dallas Morning News and Carl Stillwater responded. His résumé stated that he'd managed a Dairy Queen in Ardmore, Oklahoma for three years, then an IHOP for a year after that. I asked Luther why Stillwater wanted to leave his current job and was told he was tired of Oklahoma and felt Texas had more opportunity."
"They were probably on to him up there."
"Possibly. I'm sure Luther didn't bother to check references. Anyway, Luther and Stillwater got along famously from the first day they met. Stillwater seemed to be knowledgeable, confident and dependable. As time went on, Luther spent less and less time at the restaurant and eventually turned the job over almost completely to Stillwater. We found out later that Luther had managed to obtain a new brokerage contract with another insurance company and was selling insurance again.
"So, he expected to get paid for doing nothing?"
"Yeah. Jim was really pissed off when he found out about it. After the first cash call he insisted on reviewing the books. This annoyed Luther. He complained he had better things to do than dig up all the partnership records and sit around while Jim pawed through them. He stalled for several weeks but finally succumbed to Jim's pressure.
"It didn't take Jim long to see that someone was embezzling from the business. There were a lot of voided tickets which he at first attributed to sloppiness but then he discovered something really odd. Several checks had been sent to the same vendor all in the same month. Curious about this, he started inspecting the endorsements. They were all deposited in the same bank account--East Texas Collection Agency."
"East Texas Collection Agency," I repeated. "I haven't ever heard of them."
"We hadn't either. Jim and I immediately reported the situation to the local police. They assigned the case to a Detective Johnson. After looking at the evidence Jim had brought him, he started a criminal investigation. A few days later he decided to stake out the First National Bank of Quinlin where the checks were being deposited into East Texas Collection Agency's account. He said it was probably a sham corporation, and by calling it a collection agency, the bank wouldn't be suspicious of checks being deposited that were made payable to a number of different companies."
"Pretty clever. I've seen that technique used before," I said
"Really?" Don replied.
"Yeah, if you don't have a cover like that you have to rely on a friendly teller or put an insider in the bank. That's risky and costs money."
Don nodded. "So, during the stakeout they got lucky. A late model Ford Ranger pick-up drove up to the drive through window. Immediately, the teller signaled him that this person was depositing checks into the East Texas Collection Agency account. He started his engine and eased over behind it. A woman was driving and she must have noticed Detective Johnson behind her and realized it was an unmarked police car. Before she got her receipt she panicked and took off. Detective Johnson and a DPS officer chased her about twenty miles down the road before catching her."
"Who was she," I asked.
"Ruby Stillwater, Carl Stillwater's daughter.
I laughed. "A family business."
"Right. Can you believe it? We were stunned to discover that Stillwater had been cheating us, relieved to find out Luther wasn't involved, and a little embarrassed for suspecting him. Later that day they arrested Stillwater at the restaurant. He didn't put up a fight. We spent the evening figuring out how much he had embezzled from us. The final number was $34,225.06."
"It could have been worse. I've seen trusted employees embezzle hundreds of thousands."
"Well, since we were a startup business there wasn't that kind of money laying around."
"Right. So, what did you do?"
"Jim blamed Luther for the embezzlement and told him so. They got into an argument and nearly came to blows. Jim wanted to get a new manager, and Pam and I thought that would be a wise idea too."
"How did Luther take that?"
"He was very upset at the time. He said he had a contract and the partners couldn't fire him. Jim disagreed and said they could fire him for cause. Jim and I agreed to have a partners meeting and discuss it formally. Luther was pissed, but said he'd come. Jim told him to bring a complete set of financial reports so the partners could see exactly where they stood."
I cringed at the mention of financial reports. I doubted any such thing existed. Promoters like Luther Bell wouldn't bother with bookkeeping at all if it wasn't for the fact they'd eventually have to file a tax return. What bookkeeping there was would include only the transactions that could be traced and omit the cash that was the largest component of a restaurant's receipts.
"Our accountant was Abe Dumas. He officed down the street and turned out to be incompetent. Luther had reportedly hired him because he was convenient and cheap.
"That figures. So, where did you have the partner's meeting."
"At our house. It was a stormy night with lots of lightning and thunder--very appropriate for the mood of the partners. Luther arrived ten minutes late, which irritated all of us even more. Pam brought him back to where everyone was waiting. She offered him a drink, which he accepted. The only seat available was a piano stool where he finally sat. We exchanged cool greetings and then got down to business.
"Luther passed out the financial statements and everyone studied them. I was shocked when I saw the debts the partners owed to the IRS, the State Comptroller, and the landlord--not to mention the regular vendors. Luther blamed everything on the embezzlement and said they needed another cash call."
"You're kidding. He had the nerve to ask for more money?"
"Un huh. Jim became livid at this and moved that Luther be fired. Pam seconded the motion and it carried. Luther seemed stunned at first. He just sat there in shock while the partners discussed finding a new manager."
"This guy must be a moron. I can't believe he thought you guys would actually fork out more cash."
"I know. He'd lost all credibility with us, so we just ignored him. Jim finally came up with the idea that Pam could manage the business."
"Oh, so that's how Pam got stuck with the job."
"Yes," Pam said. "I was against it at first but finally agreed to do it on an interim basis."
I nodded.
Don continued. "When I asked Luther to meet with Pam to help with the transition he became belligerent and stormed out of the house right in the middle of a downpour."
"I was hoping he'd get struck by lightning," Pam interjected.
"The next morning at eight thirty. Pam and I arrived at the Golden Dragon Restaurant. The restaurant wasn't scheduled to open until eleven but employees started arriving at nine. Pam went in the office and started organizing the accounts payable while I surveyed the inventory on hand. By nine-thirty, most of the employees had arrived, so I called them all together and told them Pam would be their manager from that day forward.
"With the employees settled down, Pam and I went to the bank and to
ok Luther off the checking account. Then we paid a visit to Abe Dumas."
"The accountant, right?"
"Yes. It was almost noon, and Abe was behind his desk thumbing through a magazine, obviously with nothing to do. He's an old guy with only one leg. He looked more like a bum than a CPA. We told him that Luther was gone and that he was working for us now. He seemed surprised but didn't object. We asked him about the money we owed to the IRS and State Comptroller. He told us not to worry about it until we got a Notice of Intention to Levy. Then it would be serious and we'd have to deal with it. He said that usually took six months. We had enough other emergencies to worry about, so we took his advice and didn't worry about it.
I shook my head in disbelief. "I can't believe he told you that."
"Yeah, we shouldn't have listened to him. I know that now. Anyway, Pam took over and dealt with all the angry creditors as best she could, not realizing Luther had laid a trap for her."
Looking at my watch, I saw it was nearly midnight. I was exhausted and was having trouble concentrating. It was time to take my leave and resume another time. Some situations were too complicated to handle in one sitting and this was one of them.
"Several traps, I think. This is quite a story," I said. "I'm glad Luther didn't invite me in on your deal. He probably would have sold me too. I'm a sucker for a good salesman. That's why I never talk to them."
"I was going to call you, Stan," Don said, "but you are always claiming poverty, so I didn't bother."
"That's true. I've got about twenty-five dollars in my savings account, I think."
"Yeah, I bet."
I laughed. If he only knew. "It's getting late, and I promised Rebekah I'd get home two hours ago."
"Thank you for coming, Stan," Pam said. "I feel so much better now that we've told you everything. There is hope, isn't there?"
I forced a smile. "Sure, don't worry. Everything will work out okay. It always does. . . . I am concerned though. When I called the DA's office they indicated that you and Pam were persons of interest in Luther's murder. I suppose Jim and Wanda would be too. It's important that you don't talk to the police or anyone from the DA's office. As a matter of fact, don't talk to anyone because whatever you say can come back to haunt you. I want to be there if you are questioned. Tell Jim and Wanda to keep their mouths shut too."
"We will and we won't talk to anyone," Don said. "Neither of us killed Luther, Stan. They can't pin this on us."
"I know that, but the DA doesn't. Unless you have an iron-clad alibi you can bet he will try to pin it on you. . . . So, do you have an alibi?"
Don and Pam looked at each other and then back at me with solemn faces.
I said, "That's what I was afraid of."
By the end of the evening, the burden of the Blaylock's problems shifted from their shoulders to mine. Now they expected me to right their capsized vessel and send them on their way. As I drove home, I felt overwhelmed and depression quickly set in. Gazing out into the darkness I wondered how I could possibly rescue them from their dire predicaments.
Cash Call, A Stan Turner Mystery Vol 5 Page 12
