Latent Hazard

by Piers Venmore-Rowland

  There was a loud chuckle from the other end of the phone, which turned into a laugh. ‘I’m going to like working with you.’

  Kate looked blankly at the phone and wondered how David knew her comment would tickle the colonel’s sense of humour.

  ‘No need to worry about the phone line. As one of the bosses of the KAPO my line is secure and before you were put through my office traced your call back to Wood Street police station. Isn’t technology wonderful? How can I be of assistance?’

  Kate told the colonel of her pressing need for information on two UK companies with operations in Tallinn and gave him the name and Tallinn address of the former director, Pinja Koit. ‘We sense time is against us. At the moment we’ve identified a network of companies that seem to be involved.’

  ‘I’ll see what I can do to help and get back to you first thing in the morning. If you want to reach me, I’ll be on the number you phoned.’

  ‘Thank you,’ said Kate, hanging up.

  ‘Well that’s another line of enquiry up and running,’ said Emma. ‘Who knows how helpful it’ll be.’

  Whilst Kate had been on the phone to Colonel Matlik, Rafi had been working his way through the notes at the back of the accounts of all the companies potentially linked to the venture capital company, AGVC. It was a slow progress. Many of the copies of the accounts were indistinct and it wasn’t always easy to read the notes.

  Rafi was reading the fine print in the accounts for HFFF – the Hotel Frozen Fish Foods company – when he spotted that vessels were being depreciated. He turned to the back of the accounts and saw that the company owned no properties but were depreciating over £13 m of fixed assets. So in all probability they owned fishing trawlers. He got up slowly and wrote in red on the whiteboard against HFFF: Trawlers = What?

  Back at his desk Rafi carried on reading through the small print in HFFF’s accounts. He was beginning to think there was nothing else of interest, when tucked at the end of an obscure note was the sentence stating that an exchange rate of £1 to EEK23.89 had been used.

  ‘Yes!’ he exclaimed and called across to Kate. ‘I’ve got another company for your contact in Tallinn to look into. Emma, could you look and see if HFFF has had any Estonian directors in the past five years?’

  Five minutes later Emma walked over to the printer and then placed a piece of paper on Rafi’s desk.

  ‘Here you are, Pinja Koit again, but this time at another address in Estonia. Shall I give it to Kate?’

  He nodded.

  Kate phoned through to Colonel Matlik.

  ‘Good evening, colonel. Kate here from London. We’ve come across another UK company with Estonian interests: HFFF – Hotel Frozen Fish Foods. Their accounts show that they’ve a number of vessels – fishing trawlers, we reckon – which operate out of Estonia and we have another address for Pinja Koit.’

  ‘Thank you, I’ll add it to our investigations. We’ll talk again soon,’ said the colonel.

  ‘I have a meeting with David scheduled for 7.30 a.m. UK time,’ said Kate.

  ‘Excellent,’ came the basso profundo voice. ‘I shall phone then.’ The phone line went dead.

  ‘I’ve got Constable Peter Ashby on the phone for you, Rafi,’ said Emma.

  ‘Hello? I was wondering whether you could help me. I don’t want to sound dim in front of DI Adams,’ said Peter.

  ‘No problem.’

  ‘Once I’ve found the items on the bank statements, then what? For example, I’ve found a £132,791.60 payment on 31 December last year; it was paid electronically to the venture capital company’s bank account. I’ve the account number, the bank name, its address and its sort code. And I can confirm payments to the venture capital company for all three companies. Is there anything else?’

  ‘No, that’s brilliant. See if you can get a printout showing what you’ve told me,’ replied Rafi. There was a brief silence. ‘Are you OK?’

  ‘Yes,’ said Peter. ‘Sorry, Geoff, the manager, is showing me a neat trick on how to get the information printed out.’

  ‘Thanks. I’ll tell Kate that you’re doing a great job.’

  ‘Oh, that would be kind,’ he said.

  ‘If you keep up the good work I’m sure Kate will have more of these errands for you.’ With that Rafi hung up.

  ‘What did Peter want?’ asked Kate.

  ‘He was checking that he had everything we needed. It seems he’s still a little in awe of you and didn’t want to bother you. He’s doing a good job. He’s found proof that the three companies are linked to the venture capital company.’

  ‘That’s fantastic news,’ said Kate. ‘We can check out the other bank accounts tomorrow, but for the time being let’s assume that all ten companies are linked to the venture capital company and are part of whatever the terrorists’ scheme is.’

  Emma spoke up. ‘The company where Basel is a director but where Rainer Spencer & Mitchell aren’t involved is just a service company he is using to stash some money away. It’s got £2.7 m in it and that’s it. Can we ignore it for now?’

  ‘Yes,’ said Kate. ‘We need to focus on the venture capital company’s activities and the four listed companies in which Prima Terra and the dubious nominee names are investors. Also, let’s not forget that ESSA might have been used to place receptive people into influential positions in key companies.’

  ‘Good point,’ replied Rafi.

  Kate smiled; it seemed she welcomed praise from him. He thought he saw Emma’s and Kate’s eyes meet for a brief second; he couldn’t place the expressions on their faces, but sensed they were knowing ones.

  ‘From what I’ve gleaned so far I think we should start with: HFFF, SPAD, UKSOIL and ESSA,’ said Kate.

  ‘All these initials are a pain,’ commented Emma.

  ‘It’s intentional; it keeps prying eyes away from the businesses,’ observed Rafi, yawning.

  ‘You look shattered – you need some sleep,’ suggested Kate.

  Rafi nodded.

  ‘Come with me.’ She took him down the back stairs to the cells in the basement.

  He lay down on the bed – his bruised shoulder and back didn’t like its hardness – and pulled the blanket over him. Seconds later he was out; the sleep of the dead tired.

  To Rafi it seemed only minutes later that Kate was gently, but painfully, shaking him awake.

  ‘See you upstairs.’

  Back upstairs John was perched on the corner of Kate’s desk.

  ‘David phoned’ said Kate to Rafi. ‘John’s now on our team. He said we could do with his experience and low cunning.’

  John smiled and nodded. ‘Pleased to help.’

  ‘And we’ve also co-opted Peter Ashby from Traffic. He’s to be our gofer.’

  The phone rang – it was reception for Jeremy. ‘OK,’ he said, ‘I’ll be down straight away.’

  He returned clutching bags full of steaming cups of coffee and tasty-looking Italian cakes. ‘With Luigi’s compliments,’ he said as he passed the coffee around.

  Emma looked across at Jeremy. ‘But we only had our supper a few hours ago. When will your obsession with food calm down?’

  ‘This is the afters! Who was it that said “An army marches on its stomach”?’

  ‘Napoleon?’ ventured, Peter, pleased to have answered before Emma.

  ‘Precisely; I asked Luigi to prepare us something to keep us going, in case we begin to flag. It’s going to be a very long night. And you try living off crap for two months and see if you can keep away from good food.’

  ‘Point taken,’ said Kate. ‘Now we have Rafi back with us, it would be a good moment to pull together all we’ve been doing over the past four or five hours, so that we can keep an eye on the big picture and make sure we aren’t going off on a wild goose chase. OK, who wants to start?’

  ‘I will,’ said John. ‘A couple of lads downstairs have been helping me with PSSAF – the public sector services businesses – and are investigating exactly where it is involved. PSSAF
is a huge organisation. Arnold Owen at Companies House has been very helpful as limited partnerships have to be registered there. He has been able to give us a detailed list of all the partnerships that PSSAF controls.’

  John paused and looked at his notes. ‘The scale of its activities is downright impressive or, from our perspective, scary. Their empire comprises numerous operations: security for police cells including – would you believe it? – Paddington Green. They also operate prisons, schools and hospitals. They have a number of “soft” facilities management contracts for the Home Office and the Foreign Office. Through a spider’s web of connected limited partnerships they employ over 200,000 people!’

  ‘Wow, that’s impressive!’ exclaimed Kate. ‘What are PSSAF’s finances like?’

  ‘They’re sailing very close to the wind. They’ve got a massive overdraft. PSSAF has grown rapidly. They’ve been very clever in that many of its limited partnership vehicles are joint ventures with leading multinational banks and investment funds. These, we believe, were structured by Renshaw Smithers. What scares us is that PSSAF is the general partner, and the morass of off-balance sheet funding makes it impossible to see what the underlying financial position is. They have management control and carry unlimited liability if things go wrong,’ replied John.

  ‘So if you take Jeremy’s line that the terrorists will be in destruction mode, PSSAF is a house of cards?’ asked Kate.

  ‘Precisely,’ said John. ‘It wouldn’t be difficult to make it collapse.’

  ‘And if it did go bust?’ asked Kate.

  ‘It would leave one hell of a mess across the public sector!’ John took a slurp of his coffee. ‘My team have also come up with another angle. With the help of Arnold Owen we’ve drawn up a list of all the people who sit on the management boards of these limited liability partnerships. Several of the names are very interesting. There are a couple of politicians and some professional advisers to Government departments! I’ve given Jeremy’s lot the list of names to see what they can make of it.

  ‘Oh, I almost forgot to say,’ continued John. ‘We had a look at where else PSSAF operate. Would you believe it, one of their businesses provides the guards to the garage at Bishopsgate police station! MI5 has traced their security man who was away from his post at the time of the bombing. He’s now on holiday in Spain and rumour has it he has bought a villa out there!’

  ‘I’ve passed our findings to the commissioner and he’s briefing all his opposite numbers that their security may be compromised, and to keep all those involved with PSSAF away from sensitive information. Giles has told them that they have to keep this under wraps. So far he hasn’t spoken to the Government departments given the number of politicians and special advisers that might be on the terrorists’ payroll.’

  The atmosphere in the room had perceivably cooled.

  Kate finally broke the silence. ‘Who would like to go next?’

  ‘Could I run through UKSOIL?’ asked Jeremy.

  Kate nodded her assent and he continued. ‘It promotes itself as a company with charitable aspirations,’ continued Jeremy. ‘Why a venture capital company is invested in such a company is beyond me. Its profitability is next to nothing. The business has grown into an operation with eight shops-cum-travel agencies,’ continued Jeremy. ‘On its charitable side it’s brought in a number of high profile businesses and FTSE 350 companies which provide valuable sponsorship for the students working for UKSOIL. Their ethos is, “Help them help themselves” and the focus is on Africa.’

  ‘Where are their travel shops and offices?’ John enquired.

  ‘Next to universities.’

  ‘Such as?’

  ‘Well in London they have two: one next to the East City Campus University and the other by the London College of Finance. As for the others: four are in the Midlands and two are next to Northern universities,’ replied Jeremy.

  ‘Is there anything in particular that might differentiate these universities?’ asked Emma.

  ‘They have an above average percentage of foreign or ethnic students and this is mirrored in the make-up of the local population. The one in East London is on the edge of the City, close to the Brick Lane community. UKSOIL comes across as being supported by the great and the good, but we believe it may be a front for recruiting terrorists,’ continued Jeremy in a serious tone. ‘My colleagues are looking at the CCTV tapes from the cameras outside their two travel shops in London and also into how the airline tickets are booked.’

  A pattern is beginning to form, thought Rafi. He glanced around the room. The team were looking worried by what they were uncovering.

  ‘Excellent work,’ said Kate. ‘Rafi, how are you getting on with the fish restaurants and hotels businesses?’

  ‘Quite well. HFFF is a substantial company and a nicely profitable one at that. It operates a fleet of trawlers out of the UK and Estonia, which gives them a base close to the old Soviet Bloc. Their acquisition of Small Joe’s Fish Restaurants and Central City View Hotels gives them ready access to retail outlets for their fish. The increased turnover has enabled them to upgrade their fishing trawlers and grow their business. At this point in time, I suggest we put the fish restaurants and the hotels to one side. Jeremy’s colleagues are looking to see if any of them are suspicious. Emma and I are concentrating on their fishing activities.’

  Kate looked thoughtfully at Emma. ‘Could their fishing fleet provide a way of moving things and people in and out of the country? See if you can locate their trawlers.’

  ‘We’re already on to it,’ said Rafi with a smile. ‘On the Internet there are lists of EU trawlers and their fishing permits. The information includes who the owner is, lots of details on the vessel itself and they’re shown by port. However . . .’ Rafi looked concerned.

  ‘Are you alright?’ asked Kate.

  ‘I’m thinking practicalities. We’re talking in terms of trawlers being used to get people in and out of the UK. I agree with their usefulness for getting things in, but I’ve a problem with using a trawler as the exit vehicle if the terrorists were indeed to launch further attacks. It would be too slow!’

  ‘I agree,’ said John. ‘Could they use them just to get the terrorists out of UK territorial waters? Thereafter, I personally would want something much faster to whisk me away.’

  ‘That’s a good point John; make sure that we pick it up when we discuss the terrorists’ exit strategy in more detail,’ added Kate.

  Rafi got up slowly and shuffled across to the whiteboard, and with his aching right hand wrote in red felt-tip: Exit – trawlers – Then what?

  ‘Where have we got to on the property front?’ asked Kate, watching Rafi’s slow progress back to his desk.

  In order to give Rafi a few extra moments to get back, Emma spoke. ‘On the property front, I was wondering whether they might use one or more of them to support potential terrorist attacks. Just imagine how much easier it would be to attack something from a secure, nearby property over which you have complete control.’

  Rafi by now had sat down and looked up. ‘Snap! I’ve been looking into this. According to PREH’s full name – Prime Real Estate Holdings – their portfolio should comprise property investments of institutional quality. Ergo, the properties should be in prime locations. The list of property addresses from the company’s mortgage register runs to three pages and among those I’ve identified four properties which look distinctly out of place.’ Rafi studied his scribbled notes. ‘They are: a retail park on the outskirts of Peterhead and three industrial estates in Prestwick, North Walsham and Hartlepool. I’ve given Emma the addresses. She’s seeing whether they’re near any potential targets.’

  ‘Why do you think that?’ enquired John. ‘Surely that’s a bit over the top. These days a plain van suffices for most purposes, so who needs properties?’

  Emma raised her head from the screen of her PC; her face was sombre. ‘What if a property overlooked a nuclear power station – would that change your view?’

>   ‘Oh bugger, yes!’ replied John.

  ‘Well, at a first glance, the Hartlepool property is bang next to the nuclear power station. If you follow the energy theme,’ continued Emma, ‘the North Walsham property is only a stone’s throw away from the huge Bacton Gas Terminal. Peterhead is one of the major Scottish fishing ports and it’s close to the vast St Fergus gas facility. The fourth property is next to Prestwick airport and not that far from Hunterston nuclear power station.’

  A shocked silence fell over the room. It was broken by Jeremy who spoke to John. ‘Remember when we chatted to Mario about the PhD dissertations?’

  ‘Bloody hell! Yes. Energy targets would fit.’

  Rafi got up slowly and wrote on the whiteboard in red pen: Other properties? and Top energy targets?

  ‘How’s about we get a large map, plus several sheets of acetate which can be laid over it with the locations of the properties. We can add the other items as we come across them. For example, Emma will soon have the ports that the trawlers are operating out of and the list of key energy installations.’

  ‘We can do better than that,’ said Kate. ‘Let’s borrow the touch screen monitor and the computer with mapping software from downstairs.’

  ‘Great idea,’ said Emma with a broad smile. ‘I’ll sort it.’

  ‘Could I have the last cake?’ enquired Peter, who had been sitting quietly to one side.

  ‘Of course, help yourself,’ replied Kate.

  ‘Thanks, they’re a bit of a treat for us lowly paid constables,’ he said with a smile.

  His comments jogged something in Rafi’s memory: money. He hadn’t done any of the financial ratios on the property company. He picked up a calculator and started with the loan-to-value ratio for PREH. It was 51.7%; in itself modest. He moved on to the debt-service-cover ratio and looked at the figure on his calculator. He redid his calculations and they came out the same. The figure looked wrong. It was only 84.9%. He would have expected a ratio of 125% or higher.

  Rafi racked his brain. Why was the debt-service-cover ratio so low? Could it be that the bank expected a significant increase in net rental incomes, from new lettings, or perhaps there were properties in course of development? Rafi pondered. So there could be some development properties out there which were not on the mortgage register!