Caroline Keating was also in a panic to reach her husband, but he wasn’t in his office and BJ didn’t know where to find him. He’d left with Wainwright and Tommy, and BJ said she didn’t expect them back before the board meeting at seven.
“Is there anything I can do?” BJ asked.
“No. I want Robert. Please try to find him and tell him to call me right away. That’s what I need, BJ.”
“Of course, but you sound terrible. Are you all right?”
“I’ve been in a car wreck and I’m still much shaken. I’m not hurt, but the car is a mess. The police told me I was lucky I was wearing a seatbelt or it could have been fatal. I’m home. Tell Robert to call me as soon as possible.”
Nine
“Show me a hero, and I'll write you a tragedy” ~ F. Scott Fitzgerald
MONDAY—EARLY AFTERNOON—APRIL | The rustic Seastar Inn was the perfect backdrop for an intimate Musketeer meeting. It had dim lighting, background humming with noise, a smart bartender, and quick table service. After bringing Tommy up to speed and ordering cocktails, Keating said to the other two, “So what are we going to do about what we’ve found?”
Tommy offered, “Of the choices I see… One, we report this to the SEC. As officers and directors, we’re all obligated to report this. Two, we go to the Board of Directors with the evidence and put it in their official laps to handle.”
“I would say that number one is a CYA move,” Wainwright said.
Tommy continued. “Or, three, we could speak with Arnold and seek his advice. After all, he is a lawyer.”
“Yeah, right, and so am I,” Keating responded.
“Yes. But Arnold has actually practiced law. I vote for three,” Wainwright said.
Keating understood Tommy Shaw possessed an eidetic memory, commonly referred to as photographic, or total recall. In addition, he was intellectually superior to all other members of the executive team. “Based on these reports, it’s clear there is fraud at All Cities. What we don’t know is if this is the work of Borstad, or if he has accomplices. We need to take this to Arnold right away, but the law says we go directly to the Securities and Exchange Commission.”
Wainwright said, “But if we do that, the cat is out of our bag and it’s all over—it’s the end for all of us. There’s no chance of keeping it in-house. The SEC will find what Robert and I dug up and the ballgame is over for this company and for all of us. At the very least, our reputations would be destroyed within the investment community. We’ll never work in this industry again. Frankly, guys, it scares the crap out of me. We can’t leave it hidden, and we can’t report the fraud to the Feds. Talk about your proverbial rock and a hard spot…”
“Even if the Feds allowed us to stay in business, we’d be cooked with brokers and their investor clients. We’d never raise another investment nickel. Boys, we’d be out of business, one way or the other,” Tommy said.
“Well put, gentlemen, but tell me…what do you see as the bad news?” Keating teased his partner.
Wainwright responded to Keating’s joking. “And tell us again, what accounting firm is going to hire a CPA that missed this fraud? No, we’re all screwed—royally!”
“Maybe Arnold and Hockney already know and there is a procedure in the works,” Keating said.
“Arnold reviewed some of these same files last week. It is possible they’ve already taken the necessary steps with the SEC and the problem is handled,” Tommy said.
“Yeah, but what if Arnold is part of this?” Keating asked.
“No way!” Wainwright exclaimed. “That’s bullshit. It’s just not possible, and you both know it.”
“Garth’s right, Robert. It’s just not something that would happen. Arnold has set the moral tone for this firm from the first day. No, whoever is doing this, it’s got to be happening without Arnold’s involvement.”
“There is another wrinkle in the SEC wet blanket here, guys,” Keating advised. “I’ve heard scuttlebutt Borstad has an IPO planned for the fourth quarter. He’s taking All Cities public. Any inquiry from the Feds would derail that machinery faster than a train wreck.”
“If he’s a part of this fraud, why would he risk exposure by doing an Initial Public Offering of All Cities? The due diligence on everything he has ever touched will be horrendous. The underwriters or the rating agencies would pick up on this like ugly on an ape,” Wainwright said.
Tommy said, “I hesitate to cut off this not-so-witty repartee between you two, but can you come up with some more clever clichés for us? I, for one, appreciate the deft humor.” He gave both of his partners his ‘serious eye,’ then continued. “It’s clear to me the scam couldn’t happen without Borstad’s involvement to some degree. He either is the leader or is complicit in the fraud. Given that, the timing for an IPO is just crazy.”
“I agree. It couldn’t happen without Borstad in the middle of it. He keeps too tight a rein on cash flows not to know. The timing of the offering is strange. Maybe he thinks it’s buried and no one will find it. Of course, Garth found it, didn’t he?” Keating said.
“Robert, I don’t mean to paint Wainwright with the hero brush, but what Garth uncovered has been missed by highly trained professional accountants, including you, my friend, for over five years. If it got past you and the external audits, it could pass the SEC and NYSE auditors,” Tommy observed. That authoritative statement effectively terminated any further criticism about Borstad’s IPO plans.
All three agreed the safest course was to seek counsel from the paterfamilias following the board meeting later that night; they also felt a united front would be the most effective approach with Arnold. They walked three abreast back to the office. Wainwright chuckled about the “Three Musketeers” handle as they left the bar for the seven o’clock meeting of the board. On the way, Wainwright broached another topic. “Hey, do you think any of this fraud stuff could be related in some way to Burke? His murder, I mean?”
Keating rolled his eyes and gave a look to Tommy that said he did not buy Wainwright’s assumptions. “You still think it was no accident?”
“What I think is that’s crazy talk,” Tommy said. “What motive to kill Burke could anyone have?”
“Hey, the singular time I like to hear the word crazy is when Patsy Cline is singing it. Yeah, I sure do think all this is connected,” Wainwright said. “What’s with you guys? You wouldn’t see dog shit until it was stinking up the bottom of your shoe. Maybe if you saw that tree… Never mind. I don’t want to go there, even to win this stupid argument. While I’m speculating on a motive, I am more sure than ever Burke’s death was a murder. For smart guys, you two are beginning to piss me off. As to motive, I can’t give you one, but I suspect it may be related to this fraud.”
Keating looked at Tommy walking next to him and their expressions indicated neither shared Wainwright’s theory. They all agreed on the swindle, but as to the death of Burke, only Wainwright was convinced it was murder and connected to the fraud. Tommy said, “Remember what William Faulkner said: ‘Facts and truth don’t have much to do with each other.’”
“The reason I asked the question, my genius friends,” Wainwright said, “is if they are connected, we have a lot more to worry about than being put out of business. We have a murderer in our midst.”
Rain swept over Lake Washington and sheeted off the boardroom windows, darkening the atmosphere inside. The partners chatting among themselves in the boardroom ceased when Chairman Hockney called the meeting to order. “Gentlemen, we have a full agenda, thanks to Herb, our new CEO, so let’s get started. Herb?”
Meyer moved through the agenda with practiced efficiency. The first item was consideration for the merger of the Clyburn firm in Chicago. This would add thousands of apartments to the CapVest portfolio. The negotiated Clyburn contract differed from the Burke transaction in that Clyburn contained provisions for a purchase price earn-out, payable over several calendar quarters and, as in Burke, it did not consolidate all operational aspects of
Clyburn’s business. The property management would remain under Clyburn’s control. Most directors warmly received this term but, not surprisingly, Borstad did not.
Meyer was openly pleased Arnold supported the proposal. Arnold’s position on any subject before the group was essential to obtain an affirmative majority vote. Of course, he knew Arnold favored the plan, for it was his idea, delivered by his agent, Dallas.
The vote for approval was carried by a majority and with that vote, Billy Clyburn was added as partner number nine. Suspicions of fraud were never discussed during the meeting. The Musketeers had asked Arnold for a few minutes with them after the meeting, but he left before they had the opportunity to speak with him. The three men were disappointed, and that rebuke stoked Wainwright’s partner collusion in fraud fires even more.
The Three Musketeers went to Keating’s office to reclaim their travel bags, which they’d parked there. Keating found telephone messages on his desk and handed one to Tommy who called his wife from BJ’s empty desk. After speaking to Shirley, Tommy told Wainwright he was needed at home and would take the red-eye tonight. He described the burglary Shirley experienced to his friend. The two of them were talking in the reception area when Keating came out of his private office and joined them. “I just got off the phone with Caroline.” Keating repeated the story of the car accident to them. “She’s not injured, but she’s scared to death right now. I want to be home with her, so I need to take a rain check on that nightcap with you two.”
“This is a coincidence—a tragic one, to be sure, but only that,” Tommy said, less than convincingly.
“I understand your position,” Wainwright told him. “But Tommy, don’t you think attacks on Shirley and Caroline might be a warning of some kind? Listen guys, these ‘messages’ support the possibility the murder of Burke is in some way connected to the embezzlement. Maybe we’re getting too close and someone is telling us to back off. I heard you, Tommy, but I think coincidence is only a word, not a fact of nature. Someone is sending a message all right, and I, for one, want to find the sonuvabitch who targeted your wives! He has to be the same person that zapped poor old Burke.”
As he was shrugging into his jacket, Keating said, “Right now, I’m on a full court press with Garth to bring this bastard down. You know, it’s amazing the perspective you get when you step away from your workday life for a minute.”
Wainwright turned to face Tommy. “Where is your head at? Are you going to help us?”
Rubbing his chin, as if in deep concentration for a few beats, Tommy said, “Of course I will. Who ever heard of the Two Musketeers?”
Ten
“A decent boldness ever meets with friends.” ~ Homer
FRIDAY MORNING—JUNE | It was beautiful a day as Wainwright looked down from thirty thousand feet to the tops of high thin cirrus clouds rippling the sky. It looked like a stone had been tossed into the still waters of a large pond. The flight to San Francisco was one he’d made many times over the years with CapVest. He often stopped in the city for a day to meet with investment brokers on his way from LA to Seattle. This morning, he was thinking about those times he was involved in marketing CapVest’s securities.
His get-together with the wholesalers yesterday in Newport Beach was a hoot. He missed those guys. On their way to San Francisco for the same kickoff meeting Wainwright was flying toward, some of the wholesalers from around the country detoured to southern California, spending a few days in the sunshine. Wainwright did miss the camaraderie of the marketing group. It was what first brought him to CapVest. It was a fun time for him—more fun than selling properties, as he was now doing. But it didn’t satisfy his achievement needs. Selling a broker in the hope he’d be effective in selling his client was what Wainwright called ‘third party selling.’ As much fun as it was, it never gave him the sense of accomplishment he got from negotiating a multi-million dollar property sale with some of the largest financial firms in the country. This was better; less fun, maybe, but certainly more gratifying and financially rewarding.
To recapture a few of those good times, Wainwright drove the hour-long I-405 to Tommy’s office to meet his old pals. It was terrific to jaw with Tommy and some of his former compatriots.
He realized his blue funk over marketing was caused from missing the daily conversations with Tommy when they’d worked together. Lately, frequent phone calls took place between the Musketeers, but there was nothing uplifting about fraud or murder. As his plane winged its way toward San Francisco and the kick-off meeting, he smiled at the memory of a special day, so many years earlier, when Tommy Shaw recruited him into the organization called Capital Vested Corporation. He remembered it so clearly.
**********
“You remember you’ve got a lunch appointment today, don’t you?” Wainwright’s administrative assistant asked.
“I do? No, I guess I forgot. Or maybe you didn’t tell me when you booked it.”
“Yes, I told you, and I wrote it down in your Day-Timer. I did tell you, last Wednesday. You’re just too rattled with that new lady you’ve been seeing. Oh, speaking of her, I did forget to tell you Sweet Debbie called to say she might get off early Friday and is excited about going to Lake Arrowhead. The weather is going to be wonderful. I sure do hope you guys have a terrific time in your cabin.”
He glanced down at the appointment book and said, “I’m sorry, here it is. Who is Tommy Shaw?”
“You’re getting to be a forgetful old goat.” She spun on her heel, concealing a smile, and left the office pretending anger.
When Tommy Shaw arrived for the lunch appointment, Wainwright passingly recognized him. Tommy had joined his land sales crew just before Wainwright left the land business. He didn’t remember his name because Tommy never sold any land for him, which is how Wainwright justified not remembering. Tommy was just another former landman. Wainwright believed the hero class in competitive corporate competition might have originated with landmen.
After some small talk, they left for lunch, with Wainwright wondering why they were having this meeting. The two acquaintances headed toward the bank of elevators. Wainwright thought Tommy was six or seven years his junior, and with his Laguna Beach tan and blonde good looks, it seemed contradictory that Tommy dressed like an old school conservative. Under the dark blue Brooks Brother’s pinstripe suite and Oxford, button-down shirt was a muscular, toned, beach-boy body. Wainwright recalled now that Tommy Shaw hid his physical strength just as he did his superior intellect.
As the elevator arrived at floor six, Tommy stepped into the cab and held the doors, in effect blocking Wainwright. Arms spread to keep the doors from closing, Tommy looked up as Wainwright started to enter the elevator cab and said, with vigor and determination, “Before lunch is through, you will have agreed to come to Seattle with me to meet the people in the firm I work for.”
Wainwright gave him a placating smile and said, “Now, Tommy,” pushing past him to enter the cab. “Why would you want me to do that?”
“Because I’m going to describe our current public offering to you. You will swear to me it can’t be done, but, of course, it is being done as we speak. You’ll want to know more, and after you study it, you’ll want to be a part of the team.” The elevator reached the lobby and they stepped toward the Wilshire exit.
At the restaurant, Wainwright finished browsing the prospectus Tommy gave him, looked skeptically at his renewed acquaintance, and said, “Can’t be done!”
“See, I told you! But it is being done. I’ve read both their legal and tax opinions. They have the best people in law on this. It’s real, and so are these guys.”
Lunch lasted until seven thirty that night, and ended only after Tommy got his promise Wainwright would soon go to Seattle with him. Wainwright agreed to the journey as much out of exhaustion as from intrigue. That it took so long to get his pledge wasn’t a surprising thing about the lunch meeting; the surprising thing was how Tommy Shaw ever drove from Beverly Hills to Laguna Beach after
all the wine they drank.
**********
The kick-off conference in San Francisco was a command performance for the entire marketing department, as well as the inhabitants of the executive floor in Bellevue. Garth Wainwright’s participation was voluntary, but since he’d invited Lacey, he was glad to be there. He arranged for her to receive the same travel courtesy arrangements as other out-of-state dignitaries. He was excited she was coming, and made some special arrangements of his own. Looking across the King Alfonso V ballroom as he entered, he saw the other two Musketeers and approached them to stand next to Keating.
“BJ tells me you asked Lacey Kinkaid to come to the kick-off. What’s with that?”
“My good friend Lacey is attending this meeting today as the representative proxy of our former colleague, one Mr. Thomas Burke, now deceased. Lacey is attending because Sonja still isn’t up to the trip, and certainly not for any festivities.” Wainwright attempted to defend his motives. “I didn’t realize BJ was still keeping track of my movements.”
“How long has that classy lady worked for you now?” Tommy asked Keating.
“Almost three years and, yes, Wainwright has monopolized her off-duty hours for much of the past year or so—to the frustration of several guys in legal, I might add.”
“Hey, she’s allowed to see anybody she has a desire to see. Can I help it if I’m cuddly and irresistible? We are friends and enjoy each other’s company from time to time. What I’m wondering is how did a guy like you ever get someone with that much class to work for you?”
The Tipping Point: A Wainwright Mystery Page 9
