Gilded Lily (30 page)

If Joseph and Moise saw traces of Edmond's ill-fated gamble with American Express in the HSBC deal, they were unable to make their protests heard. They had lost the battle when they couldn't even reach him by phone or visit him at his home. The negotiations for the sale of Republic took place without the wise counsel of his brothers. Bond and Republic executive Jeffrey Keil, who had first encouraged Edmond to make his ill-fated deal with American Express years before, conducted the negotiations. Keil was very close to Lily, and in the absence of Edmond's brothers, Keil effectively became one of the ailing banker's closest confidants.

Still, weeks before it was to be signed, the deal hit a snag as ac
countants from the HSBC Group conducted a financial review of Republic. Ultimately, Martin Armstrong, a major client of Republic's futures brokerage and chairman of Prince ton Economics International, a hedge fund, was indicted on charges of defrauding Japanese investors of nearly $1 billion. Armstrong, who has vigorously denied the charges, allegedly sold assets known as Princeton notes, promising his investors that the notes were backed by Republic. At first, Republic was not named in the investigation into Armstrong's alleged fraud scheme. However, Republic did launch its own inquiry into the scandal, which delayed shareholder voting on the HSBC deal.

Later, New York authorities revealed the collusion between some Republic employees and Armstrong, who began by opening thirty-six brokerage accounts and depositing $350 million in the bank in 1995. By the time HSBC began to analyze the bank in the fall of 1999, Armstrong had deposited more than $3 billion in 450 accounts. According to court papers, Armstrong's investors received assurances that he had invested their money in U.S. government securities. But in fact, Armstrong used the investments to speculate in commodities markets, losing millions of dollars in the process. The Ponzi scheme developed as he began losing money in the speculation and allegedly used proceeds from the sale of new Prince ton investment notes to pay off old Prince ton investors as their accounts came due. When two Republic executives discovered the scheme, they agreed to help Armstrong by issuing fake account statements.

The incident nearly scuttled the HSBC deal until Edmond agreed to take a personal loss of $450 million and cut the price for the sale of Republic from $10.3 billion to $9.85 billion. “I am taking this action because I believe that a swift completion of the transaction will be to the benefit of Republic's clients, shareholders and employees to whom my life's work has been devoted,” said Edmond in a statement in November.

Even before the deal was sealed, Edmond unwittingly began the grim preparations for death.

Edmond, who deeply loved his wife of twenty-three years, and had become estranged from his extended family in São Paulo during his final days, signed the bulk of his fortune over to her.

In São Paulo, Edmond's brothers and sisters were unprepared for such a slap in the face. They were even less prepared for his untimely death.

T
HEODORE MAURICE MAHER
entered the rarefied universe of the Safras one day in the summer of 1999 as he prepared to begin his shift at New York Presbyterian Hospital, where he worked as a nurse. Dressed in surgical scrubs and sneakers, the New England–born Maher made his way through the wide hallways of the hospital towards the neonatal nurses' station, balancing his clipboard and a steaming Styrofoam cup of coffee. Ted, as he was known to his family and colleagues at the hospital, had just driven the seventy-two miles from his home in Stormville, New York—a quaint hamlet in Dutchess County that was about twenty miles from the West Point military academy.

The school's historic cemetery is the final resting place of great American heroes like Major General George Custer, who famously made his last stand against the Indians in the battle of Little Bighorn. The cemetery also contains the remains of General Lucius Clay, who defied Soviet aggression when he repeatedly pierced through the Communist blockade of Berlin to deliver supplies to the city's entrapped population.

The tall, lanky nurse with auburn hair and a steady gaze was also
a hero, or at least that was what Ted told himself everyday. Ever since he enlisted in the army in the mid-1970s, Ted had considered himself a misunderstood hero. Ultimately, it was this hubris that would ruin his life.

It's true he had heroic qualities. He was loyal to his wife, Heidi, a fellow nurse he had met in nursing class at Dutchess Community College in 1988 and married five years later. He was a good father to his three children, for whom he happily endured the long commute from Manhattan to Stormville after finishing a grueling twelve-hour shift. He had also gone through a costly and protracted legal battle to gain custody of his eldest son, Christopher, whom he had taken away from his first wife while the boy was still an infant.

He was dedicated to his tiny patients, most of whom were born premature and jaundiced or with other serious problems that threatened their lives. Fellow nurses would marvel at his patience and ability to soothe the screaming babies under his care.

On that breezy morning in the summer of 1999, Ted casually sipped his coffee as he traded notes with Cathy, the night nurse, who briefed him on the condition of the premature infants on the ward. It was after she left that he noticed the camera, next to a set of keys and Cathy's plastic-coated nametag, at the neonatal nursing station. Ted made some inquiries, but nobody on the ward seemed to know who owned it. Which is why Ted put the camera in the pocket of his scrubs and decided to find out for himself. When he returned home to Stormville, he had the film developed at the local WalMart in order to track down the owner through the photographs. There were about five photographs on the camera, and, ever practical so as not to waste the remaining film, Maher took photos of his own children before dropping it off to be developed.

Ted immediately recognized the woman in the photographs—her fraternal twins had been recent patients of the ward—and obtained her address from the hospital's finance department. Ted wrote a note to the new mother and returned the camera to her Manhattan ad
dress. Laura and Harry Slatkin, the new parents of twins Alexandra and David, were deeply touched by Maher's gesture. Harry, a New York society figure and designer of bath products and perfumed candles, was completely surprised that Ted would return a camera that was worth well over $400. Shortly after receiving it, he called Ted to offer him a reward. In testimony at his trial in Monaco, Ted says he refused any compensation. “I said it's the right thing to do.” If Harry really wanted to show his gratitude, he could make a donation to the hospital, Ted told him.

But Harry Slatkin seems to have had an even better idea, and during that first telephone conversation he made Ted an offer that the neonatal nurse would find hard to refuse. The Slatkins were good friends of Adriana Elia, Edmond Safra's stepdaughter, and knew that Edmond needed to find a responsible nurse to join his team in Monaco. Harry asked Ted if he had ever heard of the Republic National Bank (he hadn't) and whether he would consider working for one of its senior executives who lived in Europe and was suffering from Parkinson's disease. The job paid extremely well and would give Ted the opportunity to live in Europe for a while, said Harry, although he did not offer any specifics. He did offer to set up a job interview for him right away.

At first, Ted didn't know what to think. The legal battle with his first wife over the custody of his eldest son had left him extremely short of cash. There were also rumors of a looming strike at New York Presbyterian, and Ted was worried about providing for his family since both he and Heidi worked there as nurses. It took Ted a week to decide to make the call to set up a meeting with one of Edmond's most trusted aides.

The interview took place at the Fifth Avenue offices of the Republic National Bank. Ted brought along Heidi, who spoke about moving the entire Maher clan to Monaco if Ted was successful. She also wanted to be considered for a nursing position.

On the surface, Ted seemed ideal. Here was a nurse with mili
tary training—a former Green Beret who had worked for four years with U.S. Army Special Forces on classified missions. He was also a highly respected and dedicated nurse. George Morelli, who knew Ted in New York, recalled that when an ambulance arrived with a sick infant, Ted was often the first to rush over to the child. “He was a great nurse,” said Morelli.

But the great appeal of Ted Maher to someone as security-conscious as Edmond Safra was that he knew how to use a weapon and could easily double as a bodyguard. Ted had a sterling record in the military, graduating third in his class in Special Forces.

For anyone reading his impressive resumé, Ted Maher seemed the kind of man Edmond could respect. His diligence and honesty had already been established when he went out of his way to return the Slatkins' camera. But Edmond's team had serious doubts about the tall, lanky stranger with the piercing blue eyes. Did he seem too eager, too aggressive? Why did he speak so loudly? In the end, Edmond's team was not impressed. Shortly after the interview, one of Edmond's secretaries called Lily to inform her of his decision.

Ted Maher was a man with skeletons in his closet. Did Edmond's team know about the history of schizophrenia in Ted's family? That his biological father had been institutionalized for the disorder when his son was barely two years old, and spent his life in the hospital? Or how about Ted's conviction in Nevada in June 1985? A year earlier, Ted had been arrested for burglary when he removed objects from a home he had helped build in Nevada after the builder refused to pay him. Ted was eventually sentenced to seventy-five hours of community service for what amounted to a misdemeanor offence. Could this man really be trusted with one of the wealthiest bankers in the world?

Edmond's team rejected Ted, yet they were overruled. Ted was interviewed by Bruce Sutton, the psychiatrist who had helped Edmond through his bout with severe depression. After a forty-five minute conversation with Ted, Sutton seems to have pronounced the nurse
the perfect candidate for the job, and on August 13, 1999, Ted began a short trial run at La Leopolda, where Sutton had also been invited to spend a holiday.

Lily, who was so careful about everything and everyone who entered her homes, probably assumed that Maher had been thoroughly vetted. After the four-day trial period at La Leopolda, Lily informed the staff that she wanted Ted to start immediately.

The deal with Ted was struck while Edmond's personal secretaries were on vacation, and by the time they returned, it was a fait accompli. In New York, Ted was given his new responsibilities: His salary would be $600 a day, and he would be required to work only four days a week. Ted balked, and negotiated for six days a week, which was initially refused, although eventually a deal was made that he would be paid for six days and work only five so as not to upset the other nurses, who had different arrangements. Like the other nurses employed by the Safras, Ted would be hired by a corporation—Spotless & Brite Inc.—whose address was the same as the Republic National Bank at 452 Fifth Avenue. The arrangement allowed the nurses to enter Monaco as tourists on vacation, not as professionals, to avoid the strict labor laws in the principality. In addition, Ted would have to sign a confidentiality and “nondisparagement” agreement, promising that he would not “engage in any conduct that is injurious to any Safras [sic] reputation and interest (including, without limitation), publicly disparaging or inducing others to disparage any Safra.”

Under these conditions, and with the promise of medical coverage for himself and his family, Ted began work in Monaco on October 28. Every week, he faxed his hours to a Safra family aide, and within forty-eight hours Heidi received a wire transfer of his salary in Stormville.

By all accounts Ted loved working in the sun-drenched principality. He could walk to work from his lodgings at the Balmoral, a nineteenth-century hotel where the rooms had stunning views of the port. The three-star hotel, where Ted stayed with the other
nurses, was on the avenue de la Costa, which was located directly behind the Safra penthouse. On his way to the penthouse, Ted passed expensive boutiques and elegant cafés where impeccably dressed patrons sipped café au lait and munched on croissants. When he wasn't working, he spent a great deal of his time in nearby Nice, disappearing for days at a time, although no one is quite sure what drew him to the French beachfront city so frequently. Ted says he was simply sightseeing, but others have attached darker motives to his sojourns in Nice.

He was also a regular visitor, with some of his fellow nurses, to the glittering casinos, although he was careful not to gamble too much of his wages, and balked at what he thought were absurd prices for drinks.

On November 20, another one of Edmond's aides told Ted he had been hired full-time. That was when Ted, who was terribly lonely and homesick, began searching for suitable accommodations for his family in Nice, which was about ten miles away from Monaco and much cheaper to live in. At that first interview, Ted and his wife had also spoken of homeschooling their children on the French Riviera, and perhaps now here was their chance to move to France.

In many ways, Ted had the greatest job of his life. His salary was tax-free, his expenses were paid, and the work was relatively stress-free. But there were problems. From the outset, he didn't get along with Sonia Casiano Herkrath, the unofficial head nurse who had the greatest seniority of the ten nurses who looked after Edmond. She had started work with the Safras in March 1998 and was now in charge of scheduling and billable hours for the nurses under her watch. It was on her authority that many of Edmond's previous nurses had been fired. From the outset, Ted complained to her that he didn't receive enough hours, and later told the other nurses that he hated her. Behind her back, he called her a “scorpion” or “the snake,” and told the others that Sonia was making his life “hell.”

“Ted was strange in some ways,” said Sonia at his trial. “He had
the tendency to be aggressive. He was so overeager to help Mr. Safra he pushed himself to be the first to him, and even pushed me aside.”

Sonia also criticized him for being greedy and extremely jealous, especially of her. For his part, Ted says he was just trying to please his employers.

“I considered it the best job,” said Ted. “I had a lot of respect for Mr. Safra. I went out of my way to make his life as comfortable as possible.”

In the weeks that he worked for Edmond, Ted massaged his legs when he was struck with paralyzing cramps, helped him go to the bathroom, and administered medications, especially to help him sleep at night. Edmond was in the advanced stages of the disease and suffered a great deal from muscle cramps and vertigo. At least one nurse needed to be present when he went to the bathroom so that he wouldn't fall. Edmond's pain was worse at night and he often needed to take a great deal of medication to help him sleep.

“In the day he [Edmond] moved fairly well,” said Lily in her testimony at Ted's trial. “We went out every day walking, sometimes we even went to the swimming pool so he could swim. His life in the day was almost normal. But in the evenings, when he had the strong medication for Parkinson's, he could have some ‘off' moments. These were terrible moments, very painful especially in the legs, which became rigid with cramps.”

The medication caused him to go to the bathroom frequently. “Two or three times a night, he had to go to the toilet and it was difficult to move around,” said Lily. “That is why we had two nurses. When he went to the bathroom, one was always in front of him and he would hold on to that person.”

According to the nightly schedule, Edmond's night nurses often had their hands full. “He was heavily medicated,” recalled Ted. “He was so screwed up.” Safra would have vivid dreams and he hallucinated frequently, said Ted.

In addition to massaging his feet to relieve tremors and accompa
nying him on frequent trips to the bathroom, nurses had to document what were described as “active vivid dreams” that could be “troublesome.” Nurses were repeatedly told to “always be alert during the night so as to respond quickly to Mr. S's needs.”

As the nurse's schedule clearly notes, Edmond was an invalid unable to function without the round-the-clock care of a team of professionals who administered everything from laxatives and daily vitamin injections to the Parkinson's and antipsychotic medications that fueled hallucinations and the “troublesome” dreams.

But just before he died, Edmond's health had improved. He had been working out with Ted in his private gym, and getting stronger. “Ironically, he was doing so much better the weeks prior to his death,” recalled Sonia. “We were so outraged that this had happened. He could have lived longer.”

 

THE EVENTS OF
the early morning of December 3, 1999, still remain confusing more than a decade after they took place. Initially, Ted admitted that he had started the fire in order to alert authorities to the presence of two masked intruders who had entered through a window that had been mysteriously left open in the apartment. The fire was meant to trigger the alarms in the apartment and get immediate help for his boss, he said.