“An embezzlement in Taipei,” I said.
“Yes, exactly. It’s funny how these things work, like the fluttering wings of a butterfly causing a tornado half a world away. The hedge fund didn’t survive the fall.”
“I bet the investors in Inner Circle were not very happy,” I said.
“The letters we have on file are heartbreaking.”
“You mind if I get a look?”
“No, of course not. If you have the time, Mr. Carl, I’ll make them available to you right after our meeting. And you should know, Mrs. Denniston, your husband fought valiantly to keep Inner Circle alive, paying out investors as best he could.”
“How could he pay them?” I asked.
“As I understand it, he mortgaged everything he had to keep Inner Circle going. And then, of course, people were still lining up to invest. The past performance of Inner Circle was excellent, and the demand remained high.”
“Didn’t they know the hedge fund had collapsed?”
“It appears, and this is being looked at now by the authorities” – Nettles leaned forward, lowered his voice – “the prospectus wasn’t updated.”
“But wouldn’t that be illegal?” said Julia.
“I’m afraid, yes,” said Nettles, with a touch too much glee. “Can you spell Ponzi?”
I tried to take all this in as Nettles smiled calmly at us and I felt the gel melt on my head and drip down in thick, oily rivulets. I didn’t mind that Wren Denniston, the man who stole my fiancée so many years ago, was a crook. I rather liked that. No, what was flooring me was the “nothing” word.
Nothing. Zero. Zilch. Nada. Dada. Mama. Crap.
I had thought that Julia would be loaded with her husband’s cash – it was an assumption underlying everything that had kept me up at night – but now that was disclosed to be another of my false dreams. Everything was mortgaged, everything was lost. Step back and be on your way, no money here. I looked at Julia, and she seemed to transmogrify right before my eyes into someone else, someone older and dowdier.
Sometimes I disgust even myself.
But I wasn’t the only one thrown for a loop here. Julia’s face was strangely serene, yet when I looked into her eyes I could tell that something was throwing her, badly. How could I be surprised at that? An empty bank account is enough to throw a horse. She was distressed, and I was distressed, and I bet all the Inner Circle investors were distressed, too. But our friend Ernest T. Nettles, he wasn’t showing a bit of anguish himself.
“What is your role in the company, exactly?” I said to Nettles. “Are you a partner? An accountant? What?”
“Oh, yes, I’m sorry,” said Nettles. “I thought you knew. I’ve just recently been brought on by the U.S. Trustee, who has been empowered by the bankruptcy judge to run what’s left of the company. I thought you knew that Inner Circle was in bankruptcy.”
“No,” said Julia.
“Your husband didn’t tell you?”
“No,” said Julia.
“He was tight-lipped, wasn’t he? Chapter Seven.”
“What’s that?” said Julia.
“Liquidation,” said Nettles. “My job is to collect what we can and then liquidate all the holdings for the benefit of the creditors, who, unfortunately, are many. I don’t think anyone is going to get anything out of this. But there is something.”
“Something?” I said.
“One chance to give a little back to all those who lost so much. Do you know what a preference is in bankruptcy law, Mr. Carl?”
“I’ve never done much bankruptcy.”
“A preference is a payment made on the eve of bankruptcy to a specific creditor. It’s not fair for the officers of the failing company to favor one creditor over the others, and so the Bankruptcy Code provides that the trustee can get that money back to be distributed fairly to all. Which is precisely why I was so gratified to hear that you were coming this morning, Mrs. Denniston.”
“Why is that?” she said.
“While it is not totally clear – there is a discrepancy between the company’s books and the bank records – there does appear to have been one significant preference payment made which we are trying to get a handle on.”
“How significant?” I said.
“One point seven million dollars,” said Nettles. “The full amount invested by one of the investors.”
“Yowza,” I said.
“And we want to get it back,” said Nettles.
“I bet you do.”
“But there is one slight problem,” said Nettles. “We can’t seem to find this investor. The U.S. Trustee has asked the FBI for its assistance, and yet we still have not had any success. Now, since most of the investors were friends or associates of your late husband, I was hoping you could help us get in touch with him.”
“Who is it?” said Julia. “What is his name?”
He didn’t really have to answer, did he?
17
I was alone in one of the empty offices at Inner Circle Investments, sitting at an empty desk, surrounded by empty walls, with a single thick file in front of me. The phone was disconnected, the hallways were deserted, the hush of failure settled over everything like a dank, foul blanket. There is nothing sadder than a business in its death throes, except maybe a business that is already dead. And have no doubt, Inner Circle Investments was dead.
Julia had left to absorb the fact that she was penniless, and Ernest T. Nettles, after escorting me here and giving me the file, had returned to his own office to continue his liquidation of the company and the search for the missing preference payment. He was a jaunty fellow, Ernest Nettles, yet I wouldn’t want to be on his wrong side. I could just imagine him in a skiff, with an eye patch and a wooden leg, scanning the horizon for his prey.
“Thar Cave blows.”
Yes, of course, the one point seven mil had been paid to the mysterious Miles Cave. Who else was so much in demand? I wondered who would find Miles Cave first, Ernest Nettles or Gregor Trocek. I’d have bet on Nettles, and for Miles’s sake I hoped I was right, because Gregor wouldn’t follow the niceties required by the Constitution. When Sandro sticks hot poker in your eye, Gregor would say in his harsh Eastern European accent, you have right to scream and scream and scream.
It wasn’t so hard to figure out what had happened. Gregor was probably chin-deep in some nefarious enterprise, maybe involving those young Portuguese girls he went on about so rhapsodically. The problem with nefarious enterprises is that the cash they generate is dirty. So how, then, to keep your assets growing? Find an old friend in the investment business, have him bring in another old friend as a straw man, invest the money in the straw man’s name as a way to launder the cash. All quite simple, until the straw man withdraws the investment and then withdraws from the face of the earth.
But it wouldn’t be only Ernest Nettles and Gregor Trocek on Miles’s tail, if I had anything to do with it. Soon I would have to find a way to put Sims and Hanratty on the Miles chase, too, because who was a better suspect for Wren Denniston’s murder? If Wren were still alive, he could have pointed the authorities in the right direction, and, once caught, Miles would have had no choice but to give the money back, either to Nettles at the point of a lawsuit or to Trocek at the point of a gun. One point seven mil was a healthy motive for murder.
But there were other suspects now, too, weren’t there? A whole mess of impoverished investors, looking for a pound of flesh in exchange for their now-worthless investments. Which was why I opened the file Nettles had given me and delved into the sad trail of destruction that seemed to follow inevitably in Wren Denniston’s wake.
The letters in the file were originals, typed on bond or hand-scrawled, and heartbreaking all. They were shouts of pain from the friends Wren had induced to invest in his firm, the letters requesting, demanding, begging. Where is my money? Give me back my money. My daughter is sick. My wife is dying. I have children to put through college. You’re an old friend. My oldest friend. Don’t do this to me. I’m going to a lawyer. I’m going to the police. Please, Wren, I’m pleading with you, get me back my money. The emotions were still so wet and raw it was as if moist, red blood were staining each page.