by Tom Bower
We also interviewed in 1973 Saul Steinberg, the chairman of Leasco, Robert Hodes, his lawyer, and other Leasco executives. In the event, only the interview with Mr Steinberg was transmitted but other interview notes were kept. At the time, Mr Steinberg also made available a quantity of documents concerning his negotiations during 1969 with Mr Maxwell and Robert Fleming, the merchant bankers. These papers were clearly of great help in the describing of those events nearly twenty years later. All the quotations from Mr Steinberg and other Leasco executives emanate from 1973.
The interviews which I conducted are clearly quoted and sourced. Inevitably, many requested that their comments be off the record and therefore I have not listed any acknowledgements for the enormous help, encouragement and kindness I have received from so many people.
One person who deserves special mention, however, is Michael Shaw of Curtis Brown, whose support has been invaluable.
The individual sources for each chapter do not separately mention newspapers or interviews. These are either apparent from the text or were off the record.
CHAPTER ONE
14-15 According to an historical survey. Herman Dicker, Piety and Perseverance: Jews from the Carpathian Mountains, Sepher Hermon, New York, 1981, page 58 The best descriptions of the Jewish communities in Carpo-Ruthenia are in the third volume of S. Y. Goss and Y. Cohen, The Jews of Czechoslovakia; The Marmos Book', a special historic memorial about the Jews of Slatinske Doly (or Szlatfina) published by the Yad Vashem Institute, Jerusalem.
CHAPTER TWO
I have drawn upon the detailed records of Ferdinand Springer Verlag for the relationship between Maxwell and the publishers; and on interviews with the surviving but retired staff who negotiated with Maxwell during those years.
46 Maxwell's offer was 'the only hope for rebuilding our company'.
Lange letter, 18 February 1955 46 Maxwell's own account. LSE Seminar, 25 February 1969 48 Von Eugen's protest to Kirkness. Public Records Office F0371
1056/250
Springer's contract with EPPAC dated 16 September 1949; cf. Lange letter, 18 February 1949 and Maxwell, 14 April 1951
He threatened to renege on the whole deal. Historic summary of Maxwell's relationship with Springer, page 11
53 Maxwell sent Otto a menacing letter. Letter, 15 March 1949
Maxwell, wrote Tonjes, seemed to ignore any advice and was even signing letters as 'chairman'. Letter, 18 February 1955
'Maxwell gave us enormous and valuable help over those years.' Summary, page 14
62 Tor Maxwell, it was the means to build for himself a huge
business in London.' Summary, page 14 65 By November 1950 the outstanding bills amounted to £115,000.
Letter, 25 November 1950 67 Maxwell had overcharged Springer's old customer. Summary,
page 24
70 'I deeply regret having to write this letter.' 10 October 1951
CHAPTER THREE
71 The various histories of Maxwell's companies have been obtained
from the records at Companies House.
71 The best sources for the Simpkin Marshall affair are the Receiver's Report, 1955; the reports in the Bookseller, 6 March 1941; 3 November 1951; 3 March and 18 June 1956; and the Public Record Office, 37034/5/6. The Sunday Times in 1969 interviewed Kurt Wallersteiner at length and took several sworn statements from him.
85 terminate the juggling act profitably. Springer letter, 14 April 1951
88 In 1969 Maxwell explained his motives in long interviews with
journalists from the Sunday Times. 90 'Maxwell has proved to be a difficult person to do business
with.' Springer letter, 21 September 1953 92 'a wide range of Soviet scientific books is now available'.
Springer letter, 21 June 1954
CHAPTER FOUR
Philip Wade's letter to the Lancet, 27 April 1963
'I do it because it ought to be done.' Sunday Times, 9 January 1966
Betty Maxwell has described those years of running a home.
She magazine, 1987 CHAPTER FIVE
116 I have relied upon the Buckinghamshire local newspapers -the Wolverton Express (later the Wolverton and Milton Keynes Express) and the Bletchley District Express - for general coverage of Maxwell's local political career. Only a few contemporaneous documents of the Labour Party survive. Local members, however, retain a vivid memory of their experience.
118 . . I don't have any specific time or date.' Midweek, BBC TV, 1973
127 Christopher Booker's phrase, that he would be part of 'the dream after the storm'. The Neophiliacs, Fontana, 1970, page 64
129 'Now', he bitterly complained, 'our prized workshops are going to Steptoe's Knacker's Yard for pennies.' Wolverton Express, 6 March 1964
131 'I thought I was the cleverest thing on two legs there
Desert Island Discs, BBC Radio, July 1987 134 'I have watched him frequently.' Hansard, 21 November 1967 137 Bernard Levin, The Pendulum Years, Cape, 1970, page 302
'has been pestering Hugh Cudlipp with phone calls'. The Cecil King Diary 1965-70, Cape, 1972, page 171
'That's the thing about me. I'm quick off the mark.' Sunday Times, 3 March 1968
CHAPTER SIX
Marriott's query, Sunday Times, 9 January 1966
Cecil King said subsequently. DTI, page 210
Their opposition was supported by Ansbachers. DTI, page 215 158 Maxwell ignored them both. DTI, pages 210/211
158 Maxwell felt that he had 'bought a bargain'. DTI, page 233
158 A 'satisfactory return'. DTI, page 20
162 He was to 'knock off the Caxton sales force'. DTI, page 11
ILSC's accounts were in a 'deplorable state'. DTI, page 74
its profits had, on its own admission, increased only 'marginally'. H. Kay Jones, Butterworths, History of a Publishing House, Butterworths, 1980, page 196
'to get lost'. Kay Jones, op. cit., page 226
the absence of reliable information about ILSC's finances. DTI, page 74
166 'irregular and insufficient'. DTI, page 73
166 'I was entirely at fault in not getting that as a copy for
my own records.' DTI, page 73 167 'No accounts had been produced of any nature,' he said three
years later. DTI, pages 78/9 167 Maxwell recalled that he had 'honestly believed'. DTI, page 234
'Mr Bennett took the initiative in these matters.' DTI, page 232
'heavily influenced by Mr Maxwell'. DTI, page 237 (and cf. DTI, page 231)
168 Tell me where the £200,000 profit is.' DTI, page 268
168 the profits were considerably lower than officially anticipated.
DTI, page 137 168 'was absolutely disastrous'. DTI, page 87
Maxwell fired both men and three other senior officials for alleged incompetence. (Although the DTI inspectors stated that Maxwell's allegations were erroneous: DTI, pages 138 and 154)
'The Board of ILSC has informed Pergamon that sales and profits ... are running at the level forecast . . .' DTI, pages 48 and 143. The Sunday Times's cautiously favourable comment was typical; cf. 20 October 1968
175 the profile concluded, he was 'surprisingly mild'. The Times, 23 October 1968
177 'This is a disgraceful affair and it is up to the Takeover Panel to do its proper job.' The Times, 26 October 1968. For Murdoch's attitude, see Michael Leapman, Barefaced Cheek, Hodder, 1983
179 Maxwell had suggested in his circular sent to shareholders on 15 May. DTI, pages 143/148
ILSC's accounts were 'unreliable'. DTI, page 160
complied with the takeover code. DTI, page 435
180 'the price would rise very substantially.' DTI, page 448 180 he would repurchase the shares at any time up to 31 January 1969. DTI, page 518
CHAPTER SEVEN
185 'I just used to think I was part of it.' The Times, 19 June 1969 187 'I wasn't sure that we needed his particular expertise.' BBC TV, 1 May 1973
190 'Maxwell knew more people there than I did.' Steinberg, BBC TV,
> 1973
191 'as we reduce our administration costs'. DTI, page 163 and private
195 MSI(DS) was owned by Maxwell, his wife and Tom Clark.
DTI, page 364
195 to collect Pergamon's debts, a task which had previously been
undertaken by MSI(DS). DTI, page 365 195 for the benefit of Maxwell's sister. DTI, page 352
196 'They made a good case out to me and I was very happy . . .' DTI, page 602
'I certainly had no knowledge about terminating it.' DTI, page 602
Pergamon's profits were unaffected. DTI, page 607
197 'no ability and no experience and no know-how in this area'. DTI, page 610 199 'might be inflated or deflated as a result of such relationship’ DTI, page 600
he also managed Maxwell's private companies' accounts from the same office. DTI, page 462
with those of the private companies as 'basically impossible'. DTI, page 595
200 because all the accounts were chaotic. Pergamon Annual Report, 1970
one-third of Pergamon's total profits in 1968 would be derived from those two sales. DTI, page 492
the exact terms of credit between Pergamon and MSI Inc. DTI, page 483
'before the end of the year'. DTI, page 887
202 'on a royalty basis if issues no longer available.' DTI, page 577
the second was a confirmatory telex from MSI Inc.'s auditors. DTI, page 540
Maxwell's assurances that Pergamon had received a 'firm' order. DTI, page 579
203 a close watching brief on Pergamon's financial management. DTI, page 578
personally had the right to vet all major schemes. DTI, page 578
soon after his first meeting with Steinberg. US Court of Appeal Docket Nos 72-1638-41, 72-1654, page 9
he had disagreed with Maxwell's views of how the accounts should be prepared. DTI, page 200
a 'change of practice' in the valuation of stocks. DTI, page 578
'and I won't let you steal it'. US Court of Appeal Docket Nos 72-1638-41, 72-1654, page 9
a forecast of $1.4m profit if Pergamon owned ILSC completely. US Court of Appeal Docket No 71-1563, page 9
CHAPTER EIGHT
214 'I was amazed that it was so significant.' BBC TV, 1973
216 'Maxwell, Crook or Paranoiac' A three-volume record of the
correspondence and negotiations between Maxwell and the Sunday
Times was compiled in 1973 by Alex Finer. 218 'fair game to try to bring them down'. BBC TV, 1973
'Maxwell was used to bullying people which our people didn't like.' BBC TV, 1973
'It was amazing that everyone else thought it was so significant to the world.' BBC TV, 1973
227 'But then Maxwell showed us the photo.' BBC TV, 1973
227-8 This was a huge proportion of Pergamon's profits. DTI, page 619
228 the piles of old journals and books stacked on shelves. DTI,
page 575
228 no distinction was made in the ownership of the stock between Pergamon, MSI Inc. and Robert Maxwell & Co. DTI, page 598
Anderson saw that Pergamon's major customers for back journals were the two private family companies. DTI, page 565
had the right to return all the stock it had bought from Pergamon and demand repayment in full. DTI, page 448
230 'no noise, no loss of face, just let's slide out'. BBC TV, 1973
233 'The internal management accounts show that ILSC is now
trading profitably.' DTI, page 183
trading profit of just £40,000 at the end of the first eighteen months. DTI, page 174
to give ILSC £42,000 credit for services it had been charged for the use of the offices at Fitzroy Square. DTI, pages 176/7
'full information available and the points were not at issue'. The Times, 22 August 1969
The amount specified was just £40,000. DTI, page 185
235 Pergamon's recent purchases from ILSC worth £356,895. DTI, page 188
235 the accounts were proven to be in shambles. DH, page 187 235-6 'I and my financial advisers are completely at a loss to understand
why Leasco acted the way it did.' Sunday Telegraph, 24 August
1969
240 'has conducted himself with courage throughout the proceedings'. The Times, 29 August 1969
CHAPTER NINE
250 ‘I and my family have been through hell.' Transcript of EGM, page 10
256 Leasco would have had difficulty in establishing control over PPI. DTI, page 616
258 Ross, financed by Leasco, attempted to call a special shareholders' meeting. Supreme Court of the State of NY: Ross v. PPI and circular from Maxwell to PPI shareholders dated 4 November 1969
264 The issue, and Maxwell's reputation, were left dangling. See
Select Committee on House of Commons (Services). Accounts of Refreshment Department 1965 to 1971; Hansard, complaint of privilege, 13 October 1969, column 44; First Report from the Committee of Privileges, Session 1969-70, 3 March 1970
CHAPTER TEN
271 were quite intentionally private meetings. All England Reports, 1971, page 398
273 'up to two years . . . until the company was on its feet again'. Financial Times, 29 June 1970
When the Price Waterhouse report was finally published, it mentioned a further problem of a government export guarantee issued by the ECGD. This was also discussed by the DTI, page 75
Maxwell insisted that Pergamon had agreed to underwrite its massive debts. DTI, page 546
he told the Daily Telegraph after he returned. 21 November 1970
Price Waterhouse, the treatment of 1969 accounts was 'fair'. Report, paragraph 76
The inspectors prided themselves that they never sprang any surprises upon him. DTI, page 91
282 'I can see the value of these enquiries.' DTI, page 69 .
284 Maxwell, according to the inspectors, made no mention of
that crucial sale. DTI, page 156 284 '. . . in the warranty period which ended on the 30th June
1968'. DTI, page 159 284 Maxwell vigorously denies. They Must be Fair, page 11 284 ILSC which was 'misleading and untrue'. DTI, page 44 284 he allowed important documents to be destroyed. DTI, page 105 284 that proper records were not kept. DTI, page 119 284 that he must have known that the letter to Bernard Schwartz
was not true. DTI, page 169 284 'mislead'. DTI, page 187
284 'with the occasional statement which was untrue and calculated
to mislead'. DTI, page 172
284-5 at a meeting in Fitzroy Square. DTI, page 85
285 'It is incomprehensible to me.' DTI, page 84
285 'I can recollect clearing the document with the BPC directors
of ILSC.' DTI, page 94 285 not a single original or carbon copy was found of the draft
document. DTI, page 86 285 'Not yet'. DTI, pages 92 and 96
285 'Mr Maxwell's assertion ... is inaccurate.' DTI, page 87
285 throughout the questioning, sought to 'justify the statement'.
DTI, page 97 285 'an element of desperation'. DTI, page 176 285 admitted ever having seen [the contract] or been aware that
Pergamon had made this purchase. DTI, page 176 285 Le Bas and Jenman. DTI, pages 154 and 166 285 'Flemings too had lost faith in Mr Maxwell and his integrity.'
DTI, page 185
'Mr Briggs, due to a severe impediment in his speech'. DTI, page 186
BPC's directors . . . were censured but with considerably less emphasis. DTI, pages 58/9 and especially page 73
286 'I am constantly being amazed by the evidence from the BPC
side.' DTI, page 135 286 'the complaint'. DTI, page 14
289 Maxwell bullied them into recording profits which they disputed.
DTI, pages 235, 237/8 and 231 289 'there is a limit how far one can argue when one is an employee'.
DTI, page 251
289 Maxwell had forced him to record unrealistic profits. DTI, page 251
289 Chalmers Impey. DTI, pages 312 and 318ff.
/> 289 Maxwell had submitted to them as evidence. DTI, page 237
invoices to justify. DTI, pages 279, 285ff. and 299
'Mr Silkin, a letter dated 14 July 1971 . . .' DTI, page 330 294 back-dated invoices. DTI, page 568
