Due Diligence

by Grant Sutherland

  ‘I could speak with my father.’

  ‘I wouldn’t encourage him to get too involved.’

  ‘He’s Carltons’ chairman.’

  ‘Keep him informed,’ Penfield demurs, ‘by all means. But for the time being an active involvement on his part might be’ — he searches for the word - ‘counterproductive?’

  I turn that one over. ‘Are we talking about Lyle’s testimony before that Committee?’

  ‘It’s been mentioned. Not an opportune moment for your father to be making waves on Carltons’ behalf, I shouldn’t think.’

  ‘You know what an investigation might do to Carlton Brothers?’

  ‘We won’t do anything foolish.’

  ‘A formal investigation over nothing? An unsigned note?’

  ‘I’ll make sure they move quickly. It won’t be a long-drawn-out business.’

  He looks a very worried man. And then I suddenly realize why, the real cause of his concern. Roger Penfield, as the whole City knows, wants the Governorship of the Bank when the current incumbent retires; and this note is an unwanted obstacle in his path. Either the note is true, in which case his Unit will uncover a fraud that’s been perpetrated during his stewardship of the banking system: a serious black mark against his name. Or the note is false, and his Unit’s public intervention will serve only to give Carltons’ enemies a stick with which to beat us. Given our current problems - Daniel’s murder, which he knows about, and our Corporate Finance staff problems which he’s no doubt heard about on the City grapevine — the last thing Penfield wants is to weaken us further. A banking crisis would finish him. He wants a public investigation as little as we do.

  ‘What choice is there?’ he says.

  ‘Roger, it doesn’t matter how long it goes on. The rumours’ll be in Tokyo before your lot have been in our office ten minutes. What good does that do?’

  ‘I can’t ignore this, Raef.’

  ‘Ignoring it’s not the issue. I’m talking about the best way to handle it.’

  He goes back to his chair and picks up the note and stares at it. Then he swears.

  ‘Give me a fortnight,’I say. ‘Whatever I find, you’1l get.’

  He seems to weigh this up. The Investigation Unit — immediate exposure to the public gaze, and possibly disastrous consequences for both Carltons and him — or my proposal: a private inquiry over a limited time-frame, and the chance of a discreet resolution.

  Finally he puts the note aside. ‘It’s specialist work. And a fortnight’s beyond the bounds of my discretion.’

  ‘What’s within the bounds of your discretion?’

  ‘It’s still specialist work.’

  ‘So I’ll get a specialist.’

  He looks at me curiously, and asks if I have someone in mind.

  ‘Hugh Morgan. Acceptable?’

  Penfield takes this on board. He knows the name. ‘Could you get him?’

  ‘He owes me a favour.’

  A partner in a small but expensive accountancy firm specializing in City fraud, and an old university acquaintance, Hugh Morgan is, depressingly, a very busy man. In his time he’s done work for every regulatory body in the City, including the Bank of England. I can tell by Penfield’s silence that my proposal appeals. Hugh, discreet and professional, is ideal.

  ‘A fortnight’s too long,’ he says.

  ‘Ten days.’

  He smiles grimly. ‘Rather a long time in banking.’ Then he rests his forearms on the desk. ‘If you get Morgan, you can have till close of trade Friday.’

  ‘Friday?’

  ‘The Bankers’ Association do.’

  Five days? What chance do I have of sorting this out in five days? But when he sees I’m about to protest he raises a finger. ‘I can’t do any better, Raef. That’s it. And if I’m not satisfied by Friday evening I really will have no choice.’

  He rises and offers me his hand. The interview is over.

  5

  * * *

  At home I ring Hugh Morgan, but he isn’t in so I leave a message. Next I call my father and explain about the note.

  ‘Lyle?’ he says.

  ‘I don’t know. Maybe.’ Then I tell him about Penfield’s warning. I am firm that he should not become involved. There is a pause.

  ‘Very well,’ he agrees finally; but he is not happy. ‘Raef? It couldn't be genuine, could it?’

  My eyes wander across the kitchen walls and stop on the calendar. Friday. A fraudulent trading ring, the banker’s worst nightmare: there could be a great gaping hole where Carltons’ assets should be.

  ‘I don’t have a clue,’ I tell him.

  After a few more moments’ desultory conversation, I hang up and reach for the fridge.

  My house here in Belgravia is empty. The maid has gone home, and the nanny is down with Theresa and Annie in Hampshire. When I close the fridge door, one of Annie’s pictures comes free and flutters to the floor. I prop it against the fruit bowl where I can admire its kaleidoscope of messy swirls as I eat my cold bacon sandwich.

  It must have taken Annie quite a while, this picture: she’s a girl who has to get everything just right. When she learns a new word she repeats it again and again, then we don’t hear the word for weeks, but the next time it comes there’s no hesitation. And this picture, I can imagine her standing on the chair, leaning over the table and moving her crayon with infinite care. Her brow furrows comically when she concentrates, but she won’t allow us to laugh. On the summer evenings of her first year we often walked her through Green Park, she’d rock in her pram when the wind stirred the leaves overhead. Complete strangers would stop to look in at her; simple pleasures, yet even now their memory lingers. I turn Annie’s picture one way, then the other. A tree?

  What would I say to her now? How much of this unjust storm could she even begin to understand? That look of puzzled innocence when I first found the lump on her back, the memory of it still fills me with fear for her. But if that was all, I could have coped. My mantra these days: I could have coped. Lying awake at 2 a.m., staring at the ceiling, this is what I tell myself. If Annie just had cancer, if that was all, I could have coped.

  The phone rings. Vance. He tells me McKinnon wants to see me for lunch tomorrow.

  ‘Fine. I’ll book it in. Anything else?’

  ‘David Meyer,’ he says, and he explains that David isn’t pleased that we haven’t managed to establish meaningful contact with the Parnells’ Boardroom yet. Vance asks if I have any suggestions. I suggest that we buy David Meyer a new dummy, and Vance laughs and rings off.

  Finishing my sandwich, I head out through the drawing room. Here there’s another picture, a framed photograph on the side table, of Annie, Theresa and me. Pausing, I run a finger over the frame. In that distant place five months behind us there is happiness; and ignorance. Annie smiles, the tumour already growing inside her. Theresa holds back Annie’s windswept hair and looks at me — how? With love? And me, a hand resting on. each of them, confident and secure. My life is good.

  Now, five months later, what wouldn’t I give to have the world as it was? What wouldn’t I give to have Annie unblemished, what Faustian pact wouldn’t I make? Unstoppable time. My finger slides from the frame, I turn out the lights and go up.

  MONDAY

  1

  * * *

  The London streets are barely coming to life at this dark hour, the drive in takes me less than twenty minutes. The others are already waiting in the bank’s restaurant when I arrive.

  ‘Stephen’s downstairs,’ one of the lawyers tells me. ‘Here all night apparently.’

  Ironic cheers greet our chef when he emerges from the kitchen. He’s Vietnamese, about five foot two and very slight. He smiles a lot, you’d never guess his boyhood was lost to war and his teenage years to a refugee camp in Hong Kong. His name is Win Doi but everybody calls him Big Win. Gathering the empty cups, he disappears back into the kitchen.

  I turn to the young MBA, Cawley. ‘How’d it go? Haywood give u
p?’

  ‘We got it done.’ Cawley looks haggard. Still in jeans, he must have been here with Vance since yesterday. ‘Haywood went home, I can call him if you want.’

  I tell him not to bother. No need to add another sleep-deprived zombie to our number.

  From down the table, Gary Leicester enquires languidly if there’ll be many more of these early starts. He’s the head of Leicester and Partners, the PR firm we’re using on the bid. ‘I mean this won’t become a habit, will it?’ he says.

  ‘It’s all business.’ Peter Fanshawe, our stockbroker on the bid. ‘What’s your bitch?’

  Leicester laughs. ‘Some business.’

  Smiles all round. Vance has called in everyone to discuss tactics and to make sure they‘re singing from the same songsheet when the Meyers’ increased offer is announced later this morning. Four years ago we had a highly embarrassing débacle when someone working on the Blackwright defence was accidentally left out of the loop. He was busy telling the FT that Blackwrights weren’t considering the offer while the rest of us were at a press conference on the other side of town drinking toasts to the company’s new owners. One of the few times I’ve seen Vance really angry. Nowadays when anything fundamental on a deal changes, the policy is to gather everyone together face-to-face, just like this. Win brings two jugs of orange juice from the kitchen, the smell of bacon drifts out, and suddenly I feel very hungry.

  I’d just put dinner into the microwave last night when Celia phoned. We talked, but I’m not really sure what she expects of me now. She mentioned Daniel’s will, but I don’t think it’s just that. And I noticed she can already speak Daniel’s name calmly. Compared with some of us she’s coping quite well. She talked for almost an hour. My shrivelled dinner is still in the microwave.

  Vance arrives. He’s slicked back his hair, and is wearing a different suit to the one I saw him in yesterday. At work, no matter what day, it’s always a suit with Vance, he keeps three or four spares in his office. Around the table everyone sits up a little. He takes a chair opposite Cawley and opens a folder: the battle plan. ‘Shall we start then?’ he says.

  Beyond the glass wall, the Dealing Room clock ticks over: 6 a.m.

  ‘The new number’s 180.’ Vance glances at me then the others. ‘I’m confident that will get us there. Quite quickly, with any luck.’

  ‘Walkover,’ Gary Leicester murmurs.

  Vance gives him a look. ‘Let’s save the gloating till it’s done, shall we.’

  Leicester’s cheeks flush, his eyes wander down.

  Like everyone else he picks up his pen now, and listens. Vance runs methodically through his checklist, confirming his instructions: the day’s documentation is prepared; Leicester has the press-releases ready; our broker knows exactly what we want him to do when the announcement is made. Minutiae, endless details, but every piece a potential stumbling block to the bid. As Vance talks, an air of expectation builds, it seems to stir something deep in us, almost primeval, when one company moves to devour another. After three years away from it I’d thought this feeling might have abated in me. I was wrong. For the first time since I woke, Daniel moves to the back of my mind.

  ‘I’ve prepared a summary.’ Vance passes me a sheaf of photocopies from his folder. Taking one, I hand the rest down the table, a single sheet each. ‘Para one deals with the management record,’ he says.

  Vance gives us a moment to read the litany we’ve been reciting since the first day of the bid. The Parnells’ board, comprised mainly of Parnell family members, has presided over a decline in the company’s fortunes for decades. Built up in the late nineteenth and early twentieth centuries, Parnells were once one of the country’s great transport giants, their operations reaching into every corner of the Commonwealth. No more. The business acumen and sheer energy once so prominent in the family has died out, a fact the current Parnell patriarch, Richard Parnell, fails to see. Ever since his father’s tenure on the Board, the company has shown an infallible instinct for backing the wrong horse: Pamells were still building passenger ships long after the airline boom began; they missed the growth in the oil tanker business, finally buying out one of the Greeks just in time to see that market collapse; more recently they turned up their noses at the bus business, then found the highly profitable bus companies outbidding them for rail franchises. Every single strategic decision the Parnells have made for decades has been wrong.

  ‘Para two,’ Vance says, 'recaps the Meyers’ record.’

  Another pause as we read. This paragraph, as one might expect, gives a much rosier picture: the Meyer Group has an almost unblemished record of growth. Sandersons have raised questions about how this was achieved — stories of violent union-busting on Meyers’ building sites have re-emerged in the press — but the profit record as given in this second paragraph is the story the City fund managers want to hear.

  ‘Finally,’ Vance says tapping his summary, ‘rationale of the bid, and final offer.’

  Here we have a reprise of the deal’s logic, the bid’s bottom line. Parnells retains a few overseas interests, shadowed remains of its glory days, but now it is primarily a European trucking business, a husk of the company it once was. But it owns a string of warehouses and depots on the outskirts of most major European cities between Aberdeen and Vienna, and it’s these properties the Meyers are after. If they win Parnells, Reuben and David will sell off the subsidiaries and the trucking business, and develop the increasingly valuable sites. The logic of the deal, even at the new offer price, is sound: the Meyers should make money. But the sticking point in all this is Richard Parnell. He still thinks he is a transport magnate, and as long as he can keep the rest of his family in line, and a few fund managers, he might yet retain control.

  At last I set the summary aside. Vance invites remarks from Peter Fanshawe, our broker.

  ‘180?’ Fanshawe tips his hand from side to side. ‘Close, but, yeah, that should do it.’

  There’s a murmur of agreement around the table, a sage nodding of heads. The number we’ve wrung from the Meyers gives the bid a good chance of success. Vance rests his forearms on the table.

  ‘One way or another this’ll be over within a fortnight.’ He pauses; a long pause, and everyone seems to lean towards him, waiting. Suddenly he smiles. ‘England expects every man to do his duty.’

  Big Win appears from the kitchen. Vance orders a fresh jug of coffee, and a minute later he has moved the meeting on. Don’t bore the audience and don’t confuse them: he drummed these two rules into me remorselessly all the time I worked under him. Two simple precepts, and I see them broken every day of my working life. We have all been there: the mind-numbing presentation at which half the assembled company dozes off; the chemicals analyst who mistakes himself for a comedian; the speaker who keeps losing his place; the frantic search for a missing page, and puzzled looks all round. But never with Vance. Listening to him now, I’m reminded of just how good he really is. Cawley, I see, is hanging on Stephen’s every word. Vance has to give everyone here confidence that we’re moving forward with purpose. If they have doubts, these doubts could communicate themselves to others, and market sentiment might turn swiftly against us. But even as he delivers his pep talk, he’s aware that nothing can be counted as certain. I know it too, yet I feel myself responding to his words. Like so many of the best bankers, Vance would have made a fine confidence-man. With nothing more than words he has built this deal; and words, as he’s taught me, are the insubstantial foundations of our little world, the teeming City.

  2

  * * *

  After seven thirty I get half an hour to myself which I spend at my desk catching up with the weekend’s E-mail, and generally clearing away paperwork. When I sat at my grandfather’s knee and listened to his stories about the City - a kind of Arabian Nights set in London, the way he told them — I never imagined these wasted hours. Daniel once tried to calculate how much time each year we poured into this bottomless pit. Six weeks I think it came to.r />
  Before I’ve finished the last memo, Karen Haldane comes in.

  ‘Henry won’t see me,’ she says.

  ‘Good morning.’

  She looks annoyed, but no more than usual. Finishing with the memo, I toss it in the bin. ‘Henry’s got a lot on his plate this morning. Unless it’s important, see him tomorrow.’

  ‘Who'll explain that to Inspector Ryan?’

  ‘Ryan?’

  ‘Coming to see me in ten minutes,’ she says.

  ‘About what?’

  ‘I'm the Chief Compliance Officer, Raef. Our Treasurer’s just been shot. What’s your guess?’ She puts a hand on her hip. ‘Ryan called five minutes ago, I got straight onto Henry. Good old Henry told me to bugger off.’

  ‘You don't need Henry.’

  ‘Raef, I can’t lie to them.’

  Silently I count to ten. I knew what Karen Haldane was like when I hired her. Honest and trustworthy. Fearless too, not someone to be steamrollered easily. But she doesn’t accept any grey areas in her dealings. A useful quality in the person charged with overseeing the bank’s compliance with regulatory and internal rules, but one that makes her difficult to manage. During the five years Karen’s been with us she’s averaged one major row with each Head of Department per month. When she worked with Daniel and our IT department last year, designing the new settlement system, her obstinacy nearly drove him crazy. He took to referring to her as That Bitch. Eventually I had to ask him to refrain.

  Now I ask Karen what she’s told Ryan.

  ‘That I’d have something ready for him in a few days. P and L to last month. Balance sheet. They won’t do him much good.’

  General accounts. She's right, they won’t tell him anything.

  ‘If that’s what he wants, give them to him.’

  Becky calls over the intercom; David Meyer has arrived. As I go to the door, Karen says, ‘Raef,’ and I stop and look back. ‘If Daniel’s murder had anything to do with the bank, Ryan should have access to our records.’