Bankerupt (Ravi Subramanian)

by Ravi Subramanian

  A tap on his shoulder brought Aditya back to the present. He smiled again. ‘I was thinking about the conversation with Deven.’ The smile showed no signs of going away. ‘This guy needs to be managed. He is a bit low on the top floor,’ Aditya told Shivinder.

  ‘I will keep an eagle eye on him.’

  ‘Yes.’ Aditya stretched, let out a deep sigh and got up from his chair. ‘OK. So we have to figure out how to pump forty crores of excess invoicing back into the system.’

  ‘Yes. That’s the amount of sales that we have fabricated. If we don’t pump in that money, it will continue to show as receivables outstanding.’

  ‘Anyway, these become due only in a few months. Dealers are supposed to get six months’ credit. So let’s worry about it later. If we have a good year, then we will adjust it against receivables this year.’

  ‘How do you plan to do that?’

  ‘Let’s take the same Regalia Shoes example. If in the current year, they do exceedingly well and pick up stocks worth ten crores instead of the regular five crores, we will show it as a sale of around seven crores and adjust the balance three crores that they will pay us, against last year’s overdues. If they don’t do well this year, we will be in trouble. Bottom line: this year, you have to ramp up genuine sales so that the fraudulent sales of last year can be masked.’

  ‘Worst-case scenario, we will have to manage the auditors and make sure they don’t ask too many questions. They must take us at face value and report what we want them to.’

  ‘That’s not a problem,’ Aditya interjected. ‘We can get one of our own to audit the firm and overlook minor improprieties.’

  ‘At a cost. We can manage that. What are auditors for? To write what we want them to.’ Shivinder smiled.

  That night Aditya and Nalin were at Jigar Shah’s residence to celebrate the fabulous results of Step Up Shoes, when Aditya’s phone rang. It was Narayanan.

  ‘Yes, Dad,’ Aditya said.

  ‘Aditya, I need to see you. Is it possible for you to come to Coimbatore for a day?’ There was a touch of concern in his voice. An urgency which wasn’t normal.

  ‘What happened, Dad? Is everything OK?’ It was a very strange request from Narayanan and it worried Aditya.

  ‘I’m stuck, Aditya. Need some advice.’

  ‘About what, Dad?’

  ‘Not on the phone, Aditya.’

  ‘OK, Dad.’ He was in no mood to debate. ‘I’ll come over the next weekend. By then Cirisha will also be back. I’ll bring her along.’

  ‘She is back next weekend?’

  ‘Next Thursday.’

  ‘Is it possible to come before that? I want to meet you alone.’ Aditya found this strange. ‘If for some reason you can’t make it, I will come over.’

  ‘No problem. I’ll try to come this weekend.’

  ‘That will be nice. Let me know and I will come to pick you up.’ And the call ended, leaving Aditya worried and concerned.

  The next morning, the Economic Times carried an interesting headline on the front page. ‘The birth of an Indian Reebok.’ A quarter-page article dedicated to Step Up Shoes and its financial results. This was unprecedented press coverage for Step Up Shoes. The article waxed eloquent on the management and leadership team at Step Up Shoes. Shivinder Singh had arrived in style.

  10

  End-May 2005

  MIT, Boston

  Cirisha was in the MIT Faculty Dining lounge that day. She had just finished lunch with a colleague and was about to pay up and leave when she saw a rather sullen-looking Richard walking towards them.

  ‘I need to talk to you urgently.’ Richard didn’t even wait till he reached their table.

  Cirisha looked at her colleague and said a hasty goodbye. ‘Catch you later. Let me see what our friend here wants.’

  Richard waited for her colleague to leave and handed her an envelope. ‘What is this?’ Cirisha asked him even as she opened the envelope and looked at the paper inside. It was an internal memo.

  Dear Mr Avendon

  The Faculty Evaluation Committee of MIT thanks you for your application for the post of Associate Professor and for appearing before the FEC for an interview on May 4th.

  We regret to inform you that the FEC has declined your application. This is not any indication of your academic or research skills. The Institute would be happy to have you continue in your role of Assistant Professor. You will be free to apply for a similar post twelve months from now.

  Your chair has been advised, and he will be in a position to address your queries. Should any remain, please feel free to write in to us.

  Warmest regards

  Henry Liddell

  Dean

  Richard’s application for consideration for the tenured position of an Associate Professor had been declined. After reading the letter, Cirisha looked up. Tears had formed in Richard’s eyes. She knew how much the tenure meant to Richard. He had been banking on this to come through. ‘Cirisha, don’t you think I have the bloody brains, skills, guts, initiative and self-awareness to get a tenured position?’

  In a bid to console him, Cirisha held his hand tightly. She was aware that not everyone on the tenure track ended up getting a tenured position. It was public knowledge, often unstated, that it had a lot to do with one’s popularity amongst one’s peers and the ability to raise grants rather than pure research potential and academic credentials. Richard’s biggest strength was his biggest weakness too. James Deahl. People in Deahl’s team were never able to rise above his aura, above the halo that he had around himself, and create an identity for themselves. If a Deahl-friendly person was the provost, all his people would end up getting their tenures. If Deahl didn’t have a friendly provost in chair, then all the people reporting to him would suffer. That’s the way it had been for years. The current provost, Gordon Meier, was not particularly fond of Deahl.

  ‘It’s OK, Richard. You are much better than what this letter says.’

  ‘Bullshit, Cirisha! Everyone’s been saying the same thing. If I am much better than the rest, why didn’t I get promoted to the tenured post? And you know what, there were four faculty members in the tenure review committee. And they all approved of my tenure. It got declined at the level of the dean. Why? Why did they do this to me?’ The tears were streaming freely now. She hugged even more tightly, trying to settle him.

  ‘Come, let’s go,’ she said when she realized that people around them couldn’t help but stare. Richard’s tantrum was becoming a spectacle.

  ‘No, it is OK. I will be fine. I have to meet someone. And in thirty minutes I have to be at the duPont Center.’

  Inaugurated only a few months back, the duPont Center was an Olympics-standard sports complex with every conceivable facility for students, faculty, employees and their families. Richard had been appointed as the faculty coordinator for the fencing classes. A brilliant game and a friendly demeanour made him the obvious choice. Despite being in his late thirties, on his day, Richard held the potential to beat even the university student champion at the game. It was this love for the game that made him join academia a few years later than usual. A failed attempt at becoming a professional sportsman had robbed him of a few years of an academic career.

  ‘Fencing classes?’ she asked.

  ‘Yes,’ Richard nodded. ‘Need to take my mind off this crap.’

  ‘Do you want to meet up after your classes? We can go out for a drink.’ Cirisha wanted to humour him. He was intense and impulsive; Cirisha didn’t want him to be alone. He would brood over it for a long time if he did not have anything else to keep himself engaged.

  ‘It’s OK, Cirisha. In any case you don’t drink.’ He put an arm around her shoulder and smiled. He knew that Cirisha was doing it for him. ‘I am meeting someone else in the evening. Thanks for being there for me. Despite that boss of yours.’

  ‘Haha,’ Cirisha laughed out loud, hoping to cheer him up. ‘It’s not my boss. It’s your boss who is a pain. And by the way, who are
you meeting in the evening? Anyone interesting?’ She winked.

  ‘No, Cirisha. No one interesting. But I wish there were someone who would take an interest in me.’ He turned and walked away, leaving Cirisha wondering if the cryptic comment was directed at her. ‘Naah. He meant that he wished someone would take professional interest in him and fast-track him to a tenured position,’ she thought to herself as she watched him walk down the pathway.

  Just before he turned right towards the duPont Center, he was joined by someone who gave him a long hug. Cirisha looked at them and smiled. She had seen the other person somewhere but couldn’t remember where.

  11

  May 2005

  Coimbatore

  Coimbatore airport was a small but quaint one. Ten flights took off from the airport on any given day. Aditya’s flight from Mumbai to Coimbatore took a little less than two hours. This was only the third time Aditya was coming to visit his father-in-law.

  Narayanan picked him up at the airport. A couple of minutes into the drive, Aditya realized that they were not headed home.

  ‘Where are we going, Dad?’ a curious Aditya queried.

  ‘Nilgiris Hotel. I have booked a room for you.’

  ‘I’m going back on the afternoon flight, Dad.’

  ‘Yes, I know. We can peacefully sit and chat there.’

  Aditya didn’t want to argue with him. After all, if Narayanan had decided on something, he would have thought it through. ‘Can we grab a quick coffee somewhere? Before we head to the hotel?’

  ‘Nilgiris has a café on the ground floor.’

  ‘Do you have a Barista Lavazza in Coimbatore?’ Aditya hadn’t particularly enjoyed the last time he had had coffee in the Nilgiris café and wanted to go to a better place. More so because the early morning flight had made him miss his morning dose of coffee. He hadn’t even had time to grab one at the Mumbai airport.

  ‘Of course we have Barista in Coimbatore. It’s all over the place.’ And Narayanan turned his car towards the closest Barista outlet.

  Within minutes, they were at the swanky new Barista outlet at the northern end of the upmarket Race Course Road. Since it was early in the morning, there were very few people in the café. Narayanan was happy. It meant fewer people eavesdropping on their conversation.

  Finally, when they were settled in the farthest corner of Barista, Narayanan looked at Aditya and began to explain. ‘Aditya, you must be wondering why I wanted you to come.’ Aditya nodded. ‘I wanted to talk to you without anyone else sneaking in on the conversation.’

  ‘You are making it sound a bit strange, Dad. What’s it about?’ Aditya looked around. There was a young couple in the café, apart from the two of them. But they seemed too busy with each other to listen to their conversation. He turned back and looked at Narayanan.

  ‘It’s about my business, Adi.’

  ‘Is there a problem, Dad?’

  ‘No, Aditya. Absolutely not! When you guys couldn’t help me raise funds, I was pushed to a business model which helped me grow exponentially.’

  Aditya nodded.

  ‘We decided to raise money from the public. We launched a scheme wherein people could raise emus on our behalf. For around one lakh rupees we would give them three emu eggs. They would rear the emus on their own plots of land, which would be sufficiently barricaded. We would, for a monthly fee, even supply the emu feed. After eighteen to twenty-four months, we would buy back the emus at a specific price and harvest their meat, skin, oil and so on. In the case of emu hens, we would hold on to them longer and make money on their eggs too. What we paid the customers was far less than what we would end up making on the birds.’

  The coffee arrived, a cappuccino for Narayanan and a macchiato for Aditya. Aditya waited till the person serving the coffee was out of earshot.

  ‘And did you make the kind of margins you were intending to make?’

  ‘That and more. The initial phase was phenomenally successful. Almost everyone who came to us and started an emu farm made money. Initially people were very apprehensive. But once the first lot of people who invested started making their returns, the buzz started to intensify. More and more people began queuing up to open emu farms. In fact, the second wave was so intense that farmers started selling off part of their land to raise the deposit money and started converting their balance land into emu farms. We were loaded with cash, not knowing what to do.’

  ‘Are there any rules around emu farming?’

  ‘None whatsoever.’

  ‘Then what is bothering you, Dad?’

  ‘Adi, the problem is that the business has grown. And almost everyone pays in cash. The farmers, for instance, who have enrolled with us under this scheme, don’t even have a bank account.’

  ‘Dad, you don’t need to get defensive about it. Almost everyone we meet these days deals with cash. What would you expect in a country where hardly 6 per cent of the population files income tax returns? That’s hardly a problem. What’s the issue?’

  Narayanan leaned forward, elbows on the table, and whispered, ‘The accumulated cash is becoming a problem.’

  ‘That is not a bad problem to have. I would rather be rich and have excess cash to play with than be poor.’

  ‘I know. I am not complaining. The problem is slightly different.’

  Aditya just sat there listening.

  ‘A month back, Gopal Krishna, the income tax commissioner of Coimbatore was transferred and a north Indian fellow has come in. Last week, he raided the offices of one of the largest emu farms in Mettupalayam—Rajah Emu Farms.’

  That’s when Aditya understood what the crux of the problem was. ‘So you are worried that they will raid you. And if they lay their hands on your cash, you will be in a soup.’

  ‘Yes. And they are likely to do so anytime. Temporarily, I have managed to get rid of all the cash. There are intermediaries who will manage it for me for the time being. But I don’t want to leave it with them for long. They are not very dependable. Will it be possible for you to help me move the cash? Can you keep a part of it with you in Mumbai?’

  ‘How much cash are we talking here?’

  Narayanan looked around. He pulled out a tissue from the stand on the table, scribbled something on it and turned it towards Aditya. When Aditya saw it, his eyes popped out. He looked at Narayanan, then back at the tissue paper again, and whispered, ‘Forty crores?’

  Narayanan nodded.

  ‘How the hell will I keep so much cash in Mumbai? And what will I tell Cirisha?’

  ‘I don’t know. I have to get rid of ninety.’ He pointed to the paper napkin and said, ‘CR.’ Aditya understood that he meant crores and nodded. Narayanan continued, ‘And there is nobody else that I can trust. And I obviously can’t keep this in a bank.’

  Aditya’s palms started bleeding sweat. The very thought of so much of cash in his control worried him. He wasn’t unfamiliar with massive amounts of cash but this was the first time that family was involved.

  ‘Dad, I don’t think I will be able to stash away so much in Mumbai and keep it under my watch. But …’ and he paused.

  ‘But what?’

  ‘There could be a way out. We have done that for a few big customers in the past. A few businessmen and politicians. I can try and see if we can do that for you. But before that let’s get out of here.’ Both of them got up; Aditya walked up to the counter, dropped a five-hundred rupee note and walked out, without even waiting for change.

  Once they were in the safe confines of the car, Aditya said, ‘Look, Dad, what I am telling you can’t be discussed with anyone. In Mumbai, we have a team of global relationship managers. These RMs, even though they are based in Mumbai, can help you open an account in any country. They operate below the radar. Even within GB2, not many know about these RMs. Not only will they help you open an account in countries with reasonably softer tax and extremely stringent privacy laws, they will also move your funds there. I recommend that you open an account in Geneva, Switzerland, and
move your money there.’

  ‘Will it be safe?’

  ‘Much safer than here, for sure. The Swiss have very tough confidentiality and secrecy laws. No one will ever find out.’

  ‘What if I need access to the funds?’

  ‘Call the RMs and they will deliver the cash to your doorstep.’

  ‘Oh? Is that possible?’

  ‘Yes. The only catch is that these guys do not get involved if the amounts involved are less than fifteen million dollars.’

  ‘Brilliant! Aditya, this is just brilliant! This gets rid of a big headache for me,’ Narayanan exclaimed.

  ‘Let me recheck the process. I’ll talk to them when I get back to Mumbai. Once I have the information, I will call you.’

  Narayanan was happy. Finally he had found a solution to his problem. After driving around for an hour more, Narayanan dropped off Aditya at the airport. Just before Aditya got off the car, he asked Narayanan, ‘Dad, that warehouse? Shivinder and I would like to come visit it sometime next month.’

  ‘Sure. Anytime. It’s yours, Adi.’ And he smiled. ‘But just to give you a heads-up, the warehouse is nearly full. We need to look for a new one in case you are planning to store more stock there.’

  ‘How long will it take for you to operationalize one?’

  ‘At best sixty days.’

  ‘That would be awesome. Thanks, Dad,’ said Aditya as he stepped out of the car.

  ‘Please do not discuss any of this with Cirisha,’ Narayanan reminded him. Aditya nodded as he shut the door. He did not need to be told that Cirisha would never approve of what Narayanan was doing.

  12

  May 2005

  Coimbatore

  The process of opening an account in GB2 Geneva was laughably simple. Two well-dressed, deodorant-drenched young men in their late twenties landed up at Narayanan’s residence. It took them exactly thirty minutes to complete all the formalities. An account opening form was filled up, photographs clicked, fingerprints taken and telephone numbers exchanged. Narayanan couldn’t help noticing that they had a telephone number with a Swiss code prefixed to it.