Due Diligence

by Grant Sutherland

  On Thursday the Parnells’ price took an unusual jump, not dramatic, but quite noticeable against the background of a sliding market.

  ‘More buyers than sellers,’ he says. ‘So what?’

  I point to the Thursday closing on the Footsie, the Stock Exchange’s primary index: thirty points down.

  ‘Parnells weren’t the only ones up,’ Vance protests.

  ‘Some up, some down, it’s a market.’

  ‘Who’s worked on the new offer documents?’

  ‘Haywood and Cawley.’ Two hotshot MBAs.

  ‘You warned them?’

  ‘They both know the rules.’

  The rules are that insider knowledge is untradeable; but there are degrees of knowledge, and wide grey areas where fortunes are made each year. Parnells is in our Red Book right now, the in-house list of companies no Carltons employee can dabble in. Definitely off-limits.

  I look out through the window, into the evening. Only a few lights burn in the buildings on the far side of the river. It is Sunday: all the sensible men are at home with their families. And here am I with Stephen Vance, talking business.

  ‘How are the boys?’

  He glances up from his reading. ‘Fine. Jennifer’s bringing them up next weekend.’ Jenniifer his ex-wife, they’ve been divorced several years now. ‘What about Annie?’

  ‘Better. She seems okay.’

  Vance’s grey eyes are sympathetic. He isn’t one to bare his soul or to pry into another man's personal affairs. Now he looks at me and waits.

  'They think she’s over the worst. We get some more results back in the next few days.’

  ‘How’s Theresa holding up?’

  ‘Not bad.’

  ‘You?’

  ‘Honestly?’

  He nods.

  ‘I feel,’ I say, ‘like the mine caved in, and I’m the only survivor.’

  He drops his head to one side. ‘You shouldn’t be here. Annie’s still getting over those tests. Now Daniel . . . Maybe you should have a break for a week. Take Theresa and Annie away somewhere.’

  If only, I think. If only my life were that simple again.

  ‘They’re down in Hampshire already. Seeing Theresa’s parents.’

  ‘Well, go and join them.’

  ‘Did I ever introduce you to my mother-in-law?’ At this, Vance smiles. ‘I’d just be on the phone to you here all day,’ I tell him. ‘I’d rather stay.’

  He offers to have Jennifer call Theresa, but I politely decline. He looks pensive.

  'Do you see her much?’ I ask. ‘Jennifer?’

  ‘Not much.’

  He rocks in his chair and stares out across the river. We seem to have drifted near to a subject I’ve never broached with him before, his divorce. And I feel that I could ask him now, that he’s even expecting it: What went wrong? How did the boys take it? Did he gain a new freedom, or only loneliness? Was it, in the end, a huge mistake? But I hesitate, and the moment passes. He turns back to his desk.

  ‘Daniel’s death wasn’t your fault, Raef.’

  I draw back. ‘My fault?’

  ‘Sir John thinks you’re blaming yourself. I’m not sure that I don’t agree.’

  ‘Me?’

  ‘For organizing the Treasury party. Choosing the boat.’ He raises his eyes. ‘It just happened, Raef. You’re not to blame.’

  Me. I am not to blame. Face burning, I reach across his desk for the printout from Parnells’ registrar: the latest list of shareholders.

  ‘You’re not going to take a break, are you.’

  ‘No.’ I scan the list: the usual pension funds and investment houses, and below these a cluster of nominee accounts. ‘But you can tell Sir John you tried.’

  Vance laughs. I hand him the printout. ‘Can’t see any of these causing trouble, can you?’

  Back to business. Now Vance gives me more details of this morning’s meeting. Diplomatic and businesslike, this is more likeg the Vance I know. After quoting some remark of David Meyer’s, he says, ‘I wouldn’t be surprised if the was the brains.’

  ‘I thought that was Reuben.’

  ‘So does everyone.’

  ‘Don’t get psychological on me Stephen, let’s keep them both happy.’ I turn his glass paperweight over in my hands. ‘You’re confident we're going to win this?’

  ‘Now they’ve raised the bid. Sure.’

  ‘No cock-ups?’

  ‘Raef,’ he says firmly. ‘There won’t be a problem.’

  A phone rings somewhere down the corridor. Vance points to his console. ‘Your line.’

  I pick up the receiver. Roger Penfield. He has something to discuss with me, he says, but not on the phone. He would like to see me now, in his office. ‘Twenty minutes?’ He says that he will be waiting.

  When I hang up, Vance looks at me askance. ‘Roger Penfield?’

  Pulling a face, I pick up my coat as I head for the door.

  ‘I’ll save you a seat for breakfast,’ Vance calls.

  Standing at the lifts, I hear a quick tapping at the keyboard start up behind me. The life of a man parted from his family. Sunday evening, and Stephen Vance, the corporate banker’s banker, is settling down to work.

  4

  * * *

  Nationalised in 1946, the Bank of England has been a pillar of the City for centuries. Apart from its responsibility for the currency, it has a duty to maintain stability in the banking system, an obligation overseen by Roger Penfield. A security guard accompanies me up to the office. The vast spaces of the building are meant to impress, and fifty years ago they probably did; but nowadays the marbled caverns seem an empty extravagance. The functionality of the Bundesbank offices, their German counterpart, could belong to another world: the real world, Daniel always said.

  Penfield comes round his desk to greet me, and notices me glancing about. ‘Redecoration,’ he says. ‘Three months’ worth of meetings. Drop your coat over there Raef.’

  I would ask why I’m here, but that’s not how things are done in this place. Instead I take a seat. Like me, Penfield is dressed casually. Without his suit and tie he seems strangely diminished, incongruous even, as he leans against his desk. The bright yellow Ralph Lauren jersey, I suspect, was chosen by his wife.

  ‘Ski tan?’ I venture.

  He tells me about his winter break in Canada; heli-skiing apparently, his latest big thing. Behind his smugness there is a boyish enthusiasm that redeems him. He’s reputed to have a fierce temper, but I've never seen it myself. We move on to City gossip: the Fed rate rise last week, who’s doing what to whom. And just when I’m wondering if the direct approach might have been better after all, he mentions that he’s spoken with Inspector Ryan.

  ‘Hasn’t made much headway, I understand.’

  I remark that the Inspector seems a capable man.

  Penfield never really knew Daniel, but he knows that Daniel and I were friends. He gives me a sympathetic look, but to his credit he spares me any hollow condolences. Instead he hands me a sheet of paper. ‘What do you make of this?’

  The sheet bears the Carlton Brothers letterhead; the family crest, a stag rampant on an azure shield, and the family motto, Loyal in Adversity. Beneath these, there’s a short note.

  Dear Sir,

  A fraudulent trading ring has been operating at Carlton Brothers plc over the past twelve months. Details of several transactions are enclosed for your perusal.

  No signature. I turn the page over, but the other side is blank. ‘Where’s the rest of it?’

  'That’s it. No enclosure.’

  I read the note again. ‘You’re not taking it seriously?’

  'Wouldn’t normally. These things come in from time to time. Cranks. Someone with a grudge.’ He goes to a cabinet in the corner. ‘Drink, Raef?’

  I turn my head. I ask what makes this note different.

  'Timing. We received it Friday.’ He leaves the obvious unspoken. Daniel died Thursday night.

  ‘Ryan never mentioned it,’ I sa
y as Penfield returns from the cabinet with a glass of port.

  ‘Rather our fault, I’m afraid. The letter wasn’t opened till late Friday. It went to the Investigation Unit.’ The Bank department charged with investigating questionable activity at City-based banks. ‘The head of the Unit takes his work home. He found it this afternoon. Rang me straight away.’

  So now I fill in the blanks. Penfield asked to see the note himself, and after meeting with the Head of the Investigation Unit, and still not satisfied, he called me. Probably at home, before trying the office. And somewhere along the way he’s spoken to Ryan.

  I hand back the note. ‘You think this is tied up with Daniel?’

  ‘Odd coincidence, wouldn’t you agree? This isn’t Moscow, Raef. It’s not every day a senior banker's shot dead in the street.’

  ‘So do you want me to look into it?’

  ‘We were thinking in terms of our people.’

  ‘The Investigation Unit?’

  ‘We thought perhaps early this week.’

  ‘Roger.’ I look at him in disbelief. ‘It’s an unsigned note.’

  He tells me there are certain pressures. ‘I haven’t much choice, you understand.’

  But I'm too alarmed to understand anything just yet. Pressure? From Ryan?

  ‘Our Treasurer murdered one week, and the next week the Investigation Unit’s crawling all over us? Roger, you'll know all about pressure if the rumours start. Christ. How do you think this’ll look?’

  He studies the space above my shoulder. He knows exactly how it will look. It will look as if Daniel, Carltons’ Treasurer, was involved in a fraud. Overnight, Carltons could become a leper in the City.

  ‘You can’t want that.’

  ‘Of course we don’t want it.’

  ‘Then stop it,’ I say.

  There it is, what he must have been expecting to hear. Stop it. Don’t investigate. Help me defend my bank. In my grandfather's day this conversation would have gone no further; a handshake, my grandfather’s assurance, and there it would have ended. But my grandfather’s day is gone.

  Penfield rises, the worry-lines ploughed deep. ‘Not that easy, I’m afraid. You saw that bloody Commons Committee the other day. Half a dozen of the elect, and not a brain cell to share between them. There are noses being poked in here I didn’t even know existed.’

  ‘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.’