“You’re making it sound like a public service.”
“Oh, it was a business, all right. Those three guys were making returns of fifteen to twenty percent. Their average foreclosure rate was under five percent. I waited until bonus time, cashed out, and became their fourth partner. My commute shrank to less than ten minutes. Over the next two years, I brought in almost a billion dollars of investor money. The other three partners focused on the underwriting and pricing side of the business. I focused on growth. We expanded into markets all along the East Coast. We ran ads on local cable. We bought billboard space in Florida and South Carolina. Big ads with my face under block letters announcing PLANDOME CAPITAL—WE BUY NOTES.”
“You were famous.”
“Getting there. Which became a problem in itself. We couldn’t find deals fast enough to satisfy the hedge funds and other investors. All our investors were either large institutions or hedge funds. The four of us were the only private investors. We didn’t want the regulatory headaches of dealing with the mom-and-pops. No widows. No orphans. We raised the minimum investment from ten mil to fifty. We capped it at one hundred mil for any given client. It didn’t matter. Money was still coming in like Niagara Falls.
“We talked about relaxing underwriting standards, taking a little more risk—and rejected the idea. Our worst nightmare was to wake up someday and find the foreclosure rate soaring and we were suddenly in the business of running a car wash in Staten Island or a dry cleaner in Philly. Or both.”
He drained his glass. “I don’t suppose you want to open another.”
“I have to drive back to the city later, but you go ahead.”
He thought about it. “The days get really long sometimes.”
I understood that. “The nights are worse.”
“I’m getting a glass of water. You want one?” He stood and headed for the patio doors.
“Sure.”
The day was starting to heat up. I leaned forward and pulled my shirt away from my back. There appeared to be plenty of wind out on the water—the sailboats were all still moving quickly—but the Randolphs’ yard was protected. Leaves in the tops of trees rustled. I could have used a bit of that breeze.
Randolph returned with the water.
“So, finish your story.” I said. “I have yet to even hear Von Becker’s name here.”
He nodded and sat back down.
“We’re getting there. The partners all agreed to just sit on our hands and keep milking it. We were each taking a million a year in salary and letting the retained earnings just build up at double-digit rates. We were having fun and getting rich. We closed the fund. No new money. We had invented the golden goose.”
But, of course, someone always kills the golden goose.
“The first approach from Von Becker came from a financial advisor in their private banking group. He heard about us and had a client who wanted to invest. I told him the fund was closed, but thanks for the interest and so on. I forgot about him ten seconds after I hung up the phone. A week later, Von Becker himself calls. He wants to buy the firm.”
A tugboat came around the point, towing a big barge, the cable invisible at this distance. It looked like a runaway barge chasing a tugboat. The sailboats veered away like a covey of quail running for cover.
“He saw all that cash.”
“The sonofabitch worked us over nicely. It started with cases of wine, Cuban cigars, little presents. Then he turned it up a notch. Eric liked to shoot skeet. Von Becker bought him a shotgun. A Perazzi?”
I shrugged. It sounded like an expensive stereo system.
“It’s Dick Cheney’s gun. Retails for around twenty-five grand.”
“It doesn’t seem to have done Cheney much good.”
“But it wasn’t all just flowers and chocolates. Von Becker had ideas as well. He wanted us to go national. Instead of just the East Coast, he wanted offices in Atlanta, Memphis, Chicago, Dallas, and Los Angeles. He wanted us to do an infomercial and set up a website where note holders could get a quote in five minutes or less. He wanted the fund reopened. He said we could go from one billion to ten in two years.”
“He must have been slavering over the possibility of that much new cash.”
“When the offer came, it was way over the top. One hundred and fifty million. We would each get ten mil up front, the rest in a single balloon payment at the end of five years. During the five years, we would stay in our current positions and each take two million a year in salary. Even without performance bonuses, I figured it was twice what any reasonable party might pay. I thought it was a no-brainer.”
“But not everybody agreed?”
“Three of us voted to take it. Eric said no. We tried to work it out. Instead we ended up in a screaming match. Everybody got a lawyer. Eventually we bought him out. Then I had to go back to Von Becker and convince him to stick with the deal without one of our top underwriters.”
I was beginning to see where this train wreck was headed.
“Von Becker said no problem, but he had to cut back on the up-front-cash part of the deal, am I right?”
Doug let out a long breath. “Right. From forty mil up front down to thirty. How the hell I didn’t catch on right then.”
“So he ended up buying a seventy-five-million-dollar company for thirty mil down and a promise. And in the meantime got control of a massive stream of new money coming in.”
He nodded. “And the three of us used all of our savings plus the up-front money to buy out Eric, who still isn’t speaking to me. Buddy, our younger boy, is his godson, by the way.”
“How long did the honeymoon last?”
“About six months. Then there were delays opening up in the other markets. Then Von Becker wanted us to lower underwriting standards. Take on riskier loans. Speed up the foreclosure process. No more workouts with slow payers. Every goddamn day there was another e-mail with some directive that had all of us foaming at the mouth. Gunther, the other partner—Gunther Pratt—started getting stress migraines. David and I were drinking a good bit more than usual. And the tap was still on. I had one month where three hundred million came in. We had nowhere to put it.”
“And Von Becker offered to park it for you.”
“Right. One of his funds. He offered us a decent rate of return, so our earnings still looked good to investors. The plan was to keep buying loans and take it back out of the Von Becker account as needed. Only, money was still coming in faster than we could find new deals.”
“Did investors know what was happening? That their money was actually sitting in Von Becker’s account?”
“They knew. Some questioned it. If they didn’t like it, I offered them their money back.”
“Did they take you up on it?”
“Not one. But when Von Becker heard about what I’d done he threw a fit. Reamed me out. That’s when I started to think we had a problem.”
“But no proof.”
“I kept telling myself he must be clean, otherwise the regulators would be all over him. He had auditors. The SEC had been over his books. I assumed that those guys were actually doing their jobs. I can’t believe how stupid that makes me sound right now.”
“So it comes down to who knew what when.”
“Well, that’s what the lawsuits are all about. Every penny we took in—I took in—is in limbo. When Von Becker got caught, it all fell apart. On paper, it looked like I was fronting for him—bringing in money and immediately moving it into his scam. The Feds took me out in handcuffs. They still don’t know whether they’re going to charge me or not. Every client I ever worked with sued me personally. All my money was tied up in Von Becker funds and I may never get a cent back. David and Gunther are still in the office every day, working to unwind all the notes. They brought Eric back to help out. They’re still collecting salary at least, but Eric is the only one wi
th any real money, though he’s under investigation, too. Meanwhile, the bankruptcy trustee is on their backs every day to sell off the loans and raise cash. Goddamn bloodsuckers at Goldman offered them twenty cents on the dollar for the whole portfolio. Eric told them to stick it.”
“What will the final damage be? Any idea?”
He pursed his lips and squinted one eye. “About a third of our cash was tied up in Von Becker funds. Our investors will lose seventy to eighty percent of that. That’s a guess, but probably a good one. My partners will hang tough. They know they’ve got good paper. I would think they eventually unload it all at cost or close to it.”
“So your investors may end up down twenty-five percent or so. That’s bad, but not a disaster. I mean, you could lose that in a blue-chip stock fund.”
“It depends on how our case turns out. If we’re found guilty of conspiracy with Von Becker, all the money goes into the same pool and gets divided up according to whatever the trustee thinks is fair. In which case, our people lose three-quarters of whatever they put up. Or more.”
“Do you think they’ve found all the money?”
He took a moment to think about it. “Everybody who worked with Von Becker is under investigation—except for those who have already cut a deal. And the only way to cut a deal is to tell the Feds everything. It would be hard to keep something hidden. If you don’t give up all you know, you run the risk that the next guy rats you out to make his deal sweeter.”
“Do I hear a ‘however’?”
He grinned. “You do. Von Becker had more moves than Kobe Bryant. There could be millions—tens of millions—out there somewhere. Maybe more.”
“Who would know?”
“Paddy told me you were working this angle. I’ll tell you what I told him. I don’t really know. In many ways we were very much on the outside of Von Becker’s operation. The family might know, but that doesn’t help you.”
“All that money moving around, and you have no clue where it ended up?”
“None.”
“If it would help your memory, I’m sure I can negotiate a finder’s fee. It could solve a lot of your problems.”
He was insulted. I could see it flash across his face—but the cold reality of his depression came right back. “My wife is one martini away from a nervous breakdown. I’ve lost every penny I ever made and still might have to spend some time behind bars. If I had any information that could turn our lives around, don’t you think I would have already given it up?”
I believed him. He was “the Boy Scout.”
“Sorry,” I said. “I should go.”
He didn’t disagree.
The wine was long gone, and I had gotten as much as I was going to get.
I backed the car out of the drive and pulled up to the stop sign at the head of the lane. The sign sat in a little island where the road split, surrounded by wildflowers of some kind. Lying in the midst of the flowers was an empty bottle, as though someone had tossed it from a car. Joyriding teenagers, most likely, I thought. Only, I was in Sands Point. The empty was a fifth of Rémy Martin.
• • •
EVERETT ANSWERED VIRGIL’S private line—not a surprise. Everett was doing what he did best—embedding himself in the power structure camouflaged with sycophancy, and mopping up as much of the trickle-down cash as possible.
“It’s Jason. I’m in a car. I don’t want to go into too much depth on an open line, but I thought it was time to check in.”
“Excellent. Virgil asked me just half an hour ago if I had heard from you.”
“I’ve got an expert working on the cash transfers. He’s very good. I’ve worked with him before. If there’s anything there to find, he’s the one to dig it out.”
“Padding the bill already?” he said and snickered.
My gut response was to sink to his level and tell him to “shut the hell up and just do your job, asshole,” but I managed to hold back.
“I’m paying him, Everett. Not the family. Not the firm. Me.”
“Certainly. Understood. Only making a small joke.” Everett could retreat better than anyone.
“Thursday and Friday, I made calls. Monday and today, I’m out interviewing people. I had personal business to take care of yesterday, so Virgil owes me for four days so far. I’ll e-mail him a bill when I get home.”
“Any news for me to report?”
“Early days. But from what I see, I would be surprised not to find a stash somewhere. Can I run some names by you?”
“Clients?”
“Just tell me whatever you know. Paddy Gallagher.”
“He was in the office from time to time. I didn’t trust him.”
“Oh? Why not?”
“Just a feeling. And that gold ascot.”
“Next. Douglas Randolph.”
“What did he tell you?”
“Sounds like he and his partners got royally screwed.”
“I would bet he knows something. He was their rainmaker.”
“Hmm. One more. Rose-Marie Welk. I’m going to see her tomorrow.”
“She and the other one. Tucker? The two clerks. They sat at his feet.”
“Thanks, Everett. You’ve been a great help.”
“I have? Well, good.”
There is a level of self-adoration that is immune to sarcasm. Everett was there.
| 10 |
The dreams always came in those last moments of sleep, the cusp of wakening, when the hard border between dream and reality is softest and you wake up seconds later, prepared to believe almost anything.
There were two dreams. Recurring dreams.
The cognitive areas of the brain attempt to interpret sensory signals, which in turn are mere neurological oscillations, easily ignored when one is fully awake. How and why, then, do dreams recur? And why are they often so painful?
The first dream arrived three months after my release from prison. Three men are standing around my bed—one of them is my father, who explains, sadly, that a mistake was made by the prison officials, and that these two men are there to take me back to finish the three remaining years of my sentence. He is more upset than I and it is hard for him to speak. The two men with him, anonymous prison guards, are stone-faced yet patient. I try to comfort my father, a strategy that I am fully aware serves mainly to keep me from screaming in terror and despair. Then I dress quickly, give him a last hug, and head for the door. When the door opens, I wake up. Usually bathed in sweat, my throat hoarse from not screaming.
As unpleasant as it was, this dream was relatively easy to put aside as I started my day. The message from my subconscious was clear. I didn’t want to go back. And as long as I lived a life on the straight and narrow—and kept my P.O. happy—I would not go back. By the time I finished my shave and shower, the dream was behind me. At least until the next time it returned.
That morning, I had the other dream. The one that left me fearful, angry, and guilty all day.
The Kid and I are standing on a flat, gray plain beneath a solid gray sky. There is no horizon. Water—seawater, plain green and smelling of salt and marine life—begins to swirl around our feet. The Kid is, at first, thrilled, and kicks and splashes. I am concerned. The Kid senses my growing anxiety and looks up at me. The water is already higher, up to his knees. He begins to grunt, then tries to run. The water is higher, almost to his waist, and he staggers. I grab for him and lift him up. For once he doesn’t fight it. He clings to me, his legs wrapped around my torso, his arms around my neck. I can feel his warmth and his heart beating against my chest. For a moment I can luxuriate in his closeness, but the water is now up to my waist and still rising. Without moving, I am able to see all around us—a full 360-degree view—and a dark line has appeared at the horizon. It is approaching and growing in size. It is a great circular wall, and as it gets closer, I realize that
the water is rising because of the encroaching barrier. The water is now at chest level. Though I have never been much of a swimmer, I am not afraid of water. I can float. Eventually the wall will arrive and I will float to the top and escape. But I can’t float while holding the Kid. He is small for a six-year-old, with his mother’s lean genes, but he now feels like a bag of rocks. He is frightened, tense, heavy. He has identified our mutual problem and is clinging tenaciously to my neck. The water rises up over my mouth and I kick upward. We both gasp for breath—and sink back down. Panic sets in. I kick again and again, and each time the water is higher, our opportunity to grab for air less. The Kid can’t swim, not even float. If I break his hold on my neck, he will die. If I don’t, we will both die. I reach for his arms and pull, but whether to abandon him or not, I cannot say for certain.
I woke up with a sobbing gasp, feeling a rush of vomit burning at the back of my throat. The ambiguity was enough to eat me alive. My mind demanded to know whether I had left my child to drown, and, at the same time, recoiled in horror from the thought. That’s how the dream always ended. That’s how I started the day.
Skeli had been there the second time I had the dream, a pitch-black Friday morning in January. I sat up, kicked the blankets away, and swung my feet to the floor. My claustrophobia kicked in immediately, so I got up and went into the living room. I stared down at Broadway until my breathing began to quiet.
“Are you all right?” she whispered.
I had not heard her rise. I let her put her arms around me and hug me from behind—her breasts pressed into my back, her hair nestled against my neck.
“Thank you. I’m better. That feels good.”
“Come back to bed. It’s early.”
I turned my head and gently kissed her cheek. “Not yet.”
“I’m freezing.”
So was I, now that she brought it to my attention.
Mortal Bonds Page 10
