Back in his apartment, Carlton lay on his sofa, reading the Washington Post and smoking a CAO L’Anniversaire maduro when the black 1930s-style telephone rang. He turned down Frank Sinatra before picking up.
“Pat Carlton.”
“Pat. It’s Josh. I’ve got your info.”
“That was quick.”
“The SEC aims to please.”
“Apparently. Shoot.”
“It’s a bit convoluted, even by SEC standards. As you suspected, Murfreesboro Mining Corporation is incorporated in Arkansas. Apparently in good standing. Seems clean. No litigation pending or on the books. Current on their taxes. Up to date on all their filings at SEC and in Arkansas. One class of stock. Capitalization of about thirty million. Five mil of debt.”
“So they’re solvent. Good. I was afraid they’d be a shell corp.” Carlton scribbled notations on a yellow memo pad.
“Sounds legit, but it gets complicated from there.”
“How’s that?”
“Murfreesboro Mining is owned by Hamilton Mines Incorporated, incorped in Delaware. Seems to be a holding company for a few mining concerns in Arkansas and Alaska. Their stock is controlled by Stone Holdings Inc., also out of Delaware. Stone Holdings also owns an Arkansas real estate company and part of an Arkansas savings and loan called Little Rock S&L. It nearly went bust in the late ’80s, but somehow got saved and seems to be in good standing now. Their stock is wholly owned by an outfit called Cleveland Metals Inc., also incorped in Delaware. All have only one class of stock except for Cleveland Metals. Quite a maze if you ask me.”
“Sure is.”
“My opinion is worth exactly what you’re paying for it, but I think it’s pretty bizarre to create a solvent entity on the bottom of such a stack of corporation pancakes for a small mining outfit. Even if it is violating antitrust laws.”
“Stranger things have happened.”
“True. I’ll send over what I have.”
“Great. Love to Elizabeth.”
Murfreesboro Mining was legit and solvent. Unless Murfreesboro Mining filed for bankruptcy protection, which did not appear likely, the company could pay damages to DOJ. That was all Carlton needed to know, but Josh did have a point. The corporate maze seemed overly complicated for comfort. Even for a deliberate antitrust violator.
Stalin’s words rang in his ears. “Just get a settlement and move on.” That’s exactly what he’d do.
“Open and shut,” he said out loud.
5 THREATS
Shaughnessy, McGuire & Wenzel LLP
Century Park East
Century City, California
1:37 P.M.
As a name partner of Shaughnessy, McGuire & Wenzel LLP, Dan Wenzel rated a corner office on the thirty-fifth floor of the law firm's granite and glass building. He faced the floor-to-ceiling tinted plate glass window, hands thrust deep into the pockets of his navy-blue-suit trousers suspended by black and burgundy braces. He sipped his after-lunch espresso and surveyed the expansive greens of the Los Angeles Country Club golf course below. Golf addicts arrayed in the gaudiness of pale yellows, baby blues, and contrived plaids dotted the course, antlike when seen from his privileged height.
Since his meeting with MacLean, Wenzel had applied himself to the Arkansas diamond venture fervently. He'd formed a new company for MacLean, purchased the land from Osage, recorded a deed to MacLean's new company, and signed a $1 a year lease with Osage that allowed the farmer to live on the land until his death. He contracted with a trusted geological consultant to draw up preliminary mining and environmental impact plans with the express proviso of complete secrecy until the necessary public hearings. He obtained an application from Macon Grove City Hall for a mining permit, which he was currently filling out with the consultant's help. The geological consultant was also performing a boring survey of the deposits. Judging the operation too secret at the moment, Wenzel held off negotiating a line of credit to finance the mine's initial development. For now, MacLean would have to use his own considerable funds.
Things were going smoothly, he thought, finishing the contents of his lilliputian espresso cup. The intercom beeped loudly as he ensconced himself in his soft leather swivel chair.
Gertrude bellowed from outside the closed doors of his office, where she stood guard duty. “A Geraldine Forest on line one. From the National Trust for Historic Preservation in Washington, D.C.”
Wenzel stabbed at the button next to the flashing light. “Dan Wenzel.”
“Mr. Wenzel, my name is Geraldine Forest. I'm with the National Trust for Historic Preservation in Washington.” Not a hint of warmth in her hard voice, Ms. Forest sounded like she might be a lawyer.
“Good afternoon.”
“I'll come right to it, Mr. Wenzel. The Trust has learned that one of your clients intends to conduct mining operations in Murfreesboro, Arkansas.”
“Mining, you say?” How the heck had the Trust found out so quickly? MacLean's new company name was on the deed, but how had they learned about the mining? They hadn't discussed the mining with Macon Grove or even filed the mining permit application.
“I don't know if you are aware of this, sir, but the property is a historic site. No mining can be allowed on the property.”
Wenzel's due diligence of the property had not revealed any historical status.
“I don't recall the property being listed in the National Historic Register, or any state or local list of historic properties, for that matter.”
“Well, it's not actually listed, but it qualifies for listing.”
“I see.” He didn't. “How so, if you don't mind my asking?”
“The property has very important ties to our nation's history, Mr. Wenzel,” she said, in a tone that made it sound as though even a first-grader would have known.
“It does? Don't tell me you found Jimmy Hoffa.”
Not as much as a snicker. “The site played a key role in the Civil War.”
“Really? I had no idea.” Not at all. “Exactly what role did this land play during the Civil War, if you don't mind my asking?”
“The Confederate Army used the land in 1864.”
“Used? You mean a fort? Like at Valley Forge during the Revolutionary War?”
“Not exactly, no.”
“Well what connection—exactly—did the Confederate Army have with my client's land?”
“Confederate soldiers camped on the land during the Civil War.”
“Camped? That's it? No fort? No battlefield?”
“That is correct.”
“And the Trust is going to try to prevent mining on my client's land because a bunch of soldiers made a campfire over a hundred years ago?”
“Yes.”
“You've got to be joking.”
“I assure you, I am not.”
“I've got to hand it to you. You've got chutzpah.”
“Pardon me?”
“Chutzpah, Ms. Forest. Chutzpah. Yiddish for 'guts'.” Chutzpah nothing. Something was not kosher here. “Do you realize how ridiculous this is? A fort or battlefield I understand. But a campsite? Do you have any idea how many square miles of land were marched on and camped on by soldiers during the Civil War? Almost every plot of land from Massachusetts to South Carolina. Do you intend to make the entire eastern U.S. a historical preserve? It's absurd.”
“Nonetheless, sir, we must list the land as a historic site. It's...it's our duty.”
“And it's my duty to inform you, Ms. Forest, that listing by your group does not in any way bar development on private land. Good day.”
He slammed the handset into the receiver and stared at it, fuming.
Gertrude beeped his intercom at nearly the exact same time on the following day. “A Roger Mackie from the Bureau of Land Management in D.C.”
Oy. Wenzel punched the flashing green light. “Dan Wenzel.”
“Good afternoon, sir. Roger Mackie with the Bureau of Land Management at the Department of the Interior in Washington, D.C
.” One heck of a long intro. “How are you this afternoon?”
“You tell me,” Wenzel said.
Mackie ignored the ribbing. “Let me come directly to the point, sir. The records in Pike County, Arkansas, list your client Mr. MacLean's company as the owner of a parcel of land that adjoins the Little Missouri River south of the Narrows Dam and south of Lake Greeson.”
“I think that's correct, yes.”
“Good. The records are correct, then. You have no idea how many of these county records are all topsy-turvy,” he chuckled, a dry, forced sound.
“I can imagine.”
“Yes, well, records are important because BLM has to notify all adjoining landowners whenever it redesignates a river.”
“Redesignates a river? I'm afraid you've lost me.”
“Are you familiar with the Wild and Scenic Rivers Act?”
“Never heard of it.” A small fib, really.
“The Act protects rivers from pollution.”
“I see. And?”
“There are three possible designations for rivers under the Act. The BLM has jurisdiction over the Little Missouri River adjacent to your client's land in Pike County and can designate the river as a wild river, a scenic river, or a recreational river.
“Almost all activity whatsoever is prohibited on wild rivers. The designation as a scenic river allows a certain amount of activity. Recreational rivers are preserved, except for recreational use.”
“I see. And into what category does the BLM intend to list the Little Missouri River?”
“As a wild river, of course.”
“Of course.” He refrained from anger and craved a cigarette—illegal in his building. “Well that certainly sounds like a wonderful idea. Thank you for informing me. My client will be delighted to hear that he can look forward to pollution-free fishing in the river. He's a big fisherman, you know. Very serious about it. I can't wait to call him.” Having befuddled Mackie into several seconds of silence was satisfying, more satisfying than ranting.
“You're...you're not upset about the designation?”
“Upset? Why should I be? Thanks to you, my client's land will increase in value. People pay a premium for pollution-free water and fishing, you know.”
“Yes, but ... but that designation will prevent your client from obtaining a waste discharge permit ... for his mining operations.”
Now it was Wenzel who was reduced to silence. He suddenly remembered old Osage’s story about his father being murdered by the government. The tall tale had just shrunk to credible size. He recovered quickly. “Of course, but my client will accept an additional cost. If necessary, he will be pleased to keep the water pure and pristine by simply disposing waste elsewhere than in the river. Is that satisfactory to BLM?”
Mackie's stammering evidenced his shock. “Why ... maybe. I don't know.”
“Excellent. Good day, Mr. Mackie.” He replaced the handset in its cradle.
What the hell? First the NTHP. Now the BLM. And there was still the specter of Osage's father. What's next?
The intercom buzzed mid-morning for the third day in a row.
“Mr. Wenzel. A woman named Perry Trask is on the telephone. Says she's from some group in Arkansas and it's urgent.” Gertrude's voice was a rock in the storm. Where would he be without her?
He jabbed at the telephone line. “Dan Wenzel.”
“Mr. Wenzel, Perry Trask. Counsel for MRPG, the Mineral Rights Protection Group of Arkansas.”
Her voice was cold, nasal, with a complete absence of Southern drawl.
They must be recruiting Bostonians to protect the Arkansas environment. “Pardon me. The Mineral Rights what?”
“Protection Group. The Mineral Rights Protection Group. MRPG for short.”
“Forgive me, ma'am, but I've never heard of your group.”
“Quite simply, we oppose mining.”
“All mining?”
“Particularly open-pit mining. We are an ideological organization. We believe minerals have rights. Like animals and plants. Inalienable rights.”
It was just too much for Wenzel. “Really? Do they have the right to vote? That would give a whole new meaning to 'Rock the Vote'.” He chuckled.
She ignored the barb. “We discovered you were going to mine the land below Lake Greeson. We cannot allow such action. Arkansas has already been devastated by poor environmental policy. We cannot—we will not—allow this to continue.”
“I see.”
“We are a radical organization. We don't deny this. We will do whatever is necessary to stop your client from mining.” A bit like Mackie the day before, but more on edge. More willing to do something ... violent.
“Is that a threat, Ms. Trask? Are you threatening my client?”
“No, of course not. I'm merely being courteous in giving you some advice.”
“Advice that sounds like a threat.”
“Of course, we are more than willing to litigate the issue. And as you know, litigation has a way of tolling mining permits. Litigation and...other actions.”
“I see. Then perhaps you can answer a question for me.”
“Yes?”
“How is it that seventy-two hours after a deed is recorded for the purchase of a property remarkably similar to a thousand other properties in Arkansas, your completely unknown organization contacts the owner's attorney directly after a pathetic series of failed efforts by the NTHP and the BLM to stop any mining? Care to cut the bullshit and fill me in on what's going on here, exactly?”
“I don't have a duty to explain how our group operates. The fact is your client did purchase the land, the deed was recorded as a public document, and our group virulently opposes mining. Please take this as notice, advice, warning, or any other way you wish. Good afternoon, Mr. Wenzel.”
Wenzel slammed the handset into its cradle for the third day in a row and walked to the plate glass window. A faint drizzle descended on Los Angeles. He recalled Theodore Osage's ramblings about how his father was murdered when he tried to go public with information about Arkansas diamonds and shivered.
Dressed in a black tie, white Pal Zileri dinner jacket with matching black slacks and black suede Gucci loafers, MacLean again found Wenzel pacing the green marble floor, black Taiga Louis Vuitton attaché case firmly clutched in his right hand. “Good God, man. Don't you have a home? You're always here.” His smile tightened as he noticed the worried lines on Wenzel's face.
Wenzel stared through his spectacles at MacLean. “Something's very wrong, Max. I'm completely stumped. I have absolutely no idea what these people want. I've held my own in vicious negotiations for as long as I can remember. I've always understood the other side's motivations, however unreasonable. But I just don't get this. Why do these people want to stop a diamond mining operation? It's not for environmental reasons. There are other mines nearby, ore for example, and the geological consultant tells me we can build the mine without much of an impact on the environment anyway.”
MacLean ushered him to a pale green suede Roche Bobois sofa in one of Castel MacLean's many salons.
“But you know what the real quirk is?”
MacLean eyed Wenzel, played with his blue diamond cufflink.
“The first two calls were from the National Trust for Historic Preservation and the Bureau of Land Management, the third some loony new age environmental group that actually threatened us. I had one of my associates check them out. The ink on their nonprofit incorporation papers is still wet. Whoever they are, I think it's safe to assume they were pulled in by the feds.”
“That goes without saying.”
Wenzel grasped a cigarette between index and middle finger, smoothed his red and blue tie. “So why haven't the state authorities said anything? Arkansas may not be number one on the list of environmentally conscious states, but if the feds are so riled up, you'd think the state and local authorities would have something to say.”
“Quite. But I don't understand why the feds are even inte
rested. The operation will create jobs, bring capital into the local economy. God knows Arkansas needs it. It won't pollute, no matter what the environmentalists say.”
“And,” Wenzel said, “it's not as though there aren't any diamond mines in Arkansas. That Crater of Diamonds State Park right next door brings more people into the area than this mine ever would.” He gestured wildly with his cigarette, exhaled. “After all, it's the locals who have to approve this—not the feds—and they have every interest in opening a mine.”
MacLean nodded. He'd seldom seen Wenzel wound this tight.
“Problem is, I haven't heard peep out of them. Not like I haven't tried. I've called everyone down there. Planning. Building and safety. The city council. The mayor's office. No one is ever in. They won't talk to me at all.”
“What about the seller?”
“Osage?”
“Have we asked him about this? After all, he's the one who told us about the diamonds in the first place. He lives there. Maybe he let the information leak.”
Wenzel shook his head, pushed back his unruly hair. “No. I don't think so. He's still obsessed with his big diamond conspiracy theory, convinced it goes back to his father. He only told me after I agreed to buy his land.”
“I don't believe in conspiracy theories. They're simplistic.”
“Neither do I, Max. But let me tell you, this just might make a convert out of me.” He crushed out his cigarette and reclined. “Maybe I'll get answers if I go down there and snoop around.”
“In a small town like that, you'll only generate more suspicion, shut them off. Why not attack the problem head-on?”
“What do you suggest?”
“Instead of asking questions, get them on our side. If the feds want to give us a hard time, fine. They're pretty much immune to local sentiment about a diamond mine. No one's going to lose their job in D.C. because of one less business in Macon Grove. Ultimately, the decision is up to the local residents, their local representatives. If we can sell them on the idea, we can bypass the problems with the feds. The locals are going to want this mine. Unemployment is too high down there for them to pass up this project, no matter what Washington thinks. And you know how much Southern locals like the feds.”
Patrick Carlton 01 - The Diamond Conspiracy Page 4
