Two Jakes (15 page)

“Look,
I’m just starting to look into Ballantrae. It’s hard to get any info out of the
company other than their approved brochures. You have to go through their
lawyers in Houston and an in-house PR firm. If you ask them anything about
finances they say its proprietary and they don’t want their competitors to know
how and what they are doing. Same with Victor Ballantrae himself. There is very
little on him, except what’s in the corporate bio, which basically describes
him as a wonderful human being.”

She
saw Scarne and Pourier exchange looks.

“What
is this, a fraternity house? What do you guys know that I don’t? Why the sudden
interest in Ballantrae? Why is a private eye involved?”

The
men were silent, but then Scarne said, “She probably has a right to know, if
something did happen to Shields.”

Pourior
told her. Her expression went from interested to incredulous.

“This
has Pulitzer written all over it,” she finally said when he’d finished.

“Or
lawsuit that will bankrupt me,” Pourier said. “It may be total bullshit.”

“And
it may be dangerous,” Scarne said.

“Josh
Shields was a friend of mine,” Meghan Pace said quietly. “I don’t know if his
father is right but I’d like to find out. I’ll tell you one thing. If Josh said
Ballantrae was bent, you could take it to the bank. Well, maybe not a bank. And
I don’t like his computer and notes disappearing.”

“You
know,” Pourier said, “you might want to talk to the guy who puts out
Offshore
Confidential
. Real piece of work named Reginald Sink.”

“Offshore
Confidential?”

“Yeah.
It’s a newsletter that tracks fraud, money laundering and such around the
world. Lots of stuff on Africa, the Caribbean and South America.”

“Is
he nuts?”

“In
addition to putting out his newsletters,” Pourier said, “he runs conferences
that a lot of law enforcement types attend. Probably figures that gives him
some protection. For my money he’s still crazy. Something happens to him they’d
have to put all the suspects in the Orange Bowl.”

“I’ve
never heard of him.”

“Not
many people have, but Reggie’s a legend among cops and crooks. He was actually
one of the latter. Got nailed for insider trading and did time.”

“Fox
in the henhouse,” Scarne said.

“We’ve
checked his website,” Meghan Pace said, “and there are several citations for
Victor Ballantrae and his companies. But it’s a pay-as-you-go service. To get
more than headlines we’d have to lay out serious cash.”

“That’s
not going to happen,” Pourier said. “The money wouldn’t bother me but I like to
generate my own copy. We do use the website as a tip sheet. Reg doesn’t mind.”
Pourier riffed through his Rolodex and wrote on a pad. “Here’s Reggie’s number
and address. He’s in Weston. I’ll give him a heads up. It might help if I let
him know you may be dropping by. Good luck. Say hello to Reggie for me. Just
don’t stand too close when he starts his car.”

CHAPTER
17 – EXPENSIVE TASTES

It
took Scarne a half hour to drive to Weston, an inland suburb of both Miami and
Fort Lauderdale that bumps up against the Everglades. The town allegedly marked
the limit of the megalopolis’s expansion west, although according to Pourier
few people believed that Florida’s rapacious developers would stop short of the
Gulf of Mexico 90 miles away.

Offshore
Confidential
occupied a storefront between an Edwin Watts golf superstore and a Ruth’s Chris
steakhouse in an upscale shopping plaza. The woman at the reception desk smiled
pleasantly at Scarne. He hadn’t known what to expect at a newsletter devoted to
ferreting out financial sleazebags but it wasn’t a stunning blonde who looked
like she just stepped out of Vogue.

“Oh,
yes. Reginald has been expecting you.” Boston accent. “Coffee?”

Scarne
said black would be fine. The woman disappeared and returned with a steaming
mug that said “Money Laundering Expo – Caracas - 2008” on its side. As they
started down a hallway he pointed to a wall rack filled with various
newsletters:
Offshore Confidential,
Bermuda Confidential
,
Caribbean
Alert
,
Swiss Watch
(presumably not about timepieces) and
Frauds
& Fakers
.

“Do
you publish all of those,” Scarne said.

“Those
are just our print products,” the woman said. “We also have several web-only
newsletters. We provide real-time information on the Internet, which, as you
might imagine, comes in handy when you are dealing with people who, how should
I put it, tend to move around a lot.”

They
passed a small office in which a boy and a girl sat facing each other across a
desk. They were dressed in jeans, tee shirts and sandals. Both had hair down to
their shoulders. The boy, who needed a shave, ignored them, but the girl
glanced up from her computer and waved. Scarne returned the gesture.

“They
look like college kids.”

“They
are. Interns. University of Miami. Honor students.”

They
entered an office where a man was working on a computer with his back to the
door. He was dressed much like the kids and had a brown ponytail. Only when he
turned around did Scarne realized that there was plenty of gray in his hair and
a lot of miles on his face. He looked like the quintessential aging hippie. But
he flashed a friendly smile and stuck out his hand.

“Mr.
Scarne, I presume? Reggie Sink. Well, you fit Pourier’s description, so I guess
it’s you. John’s a good sort. We steal from each other.”

He
waved Scarne into a seat.

“Now,
before you go into your spiel, I have to tell you that we sell everything we
print or put on the web.” Sink spoke rapidly, as if his mouth couldn’t keep up
with his brain. “I don’t feel comfortable giving away for free what other
people pay for. Which brings me to your subscription.”

“My
subscription? I don’t have one.”

“You
will, if you want much information out of me. Listen, it will be worth every
penny. It will open up a whole new world of potential business for you. Come
on, for a thousand bucks a year you get all my publications, print and
electronic. Less than a set of good golf clubs.”

“Do
you take American Express?”

“Certainement!
Doesn’t everyone. Allison here can take your order.”

Scarne
gave her his credit card information and mailing address. Well, he thought, so
much for saving a thousand bucks by not subscribing to a Shields newsletter. At
least it’s Sheldon’s money.

“Now
you can buy that new dress, sweetie,” Sink said.

“What
a wonderful idea,” the woman said, and walked out.

The
eyes of both men followed her.

“Allison
is another reason I charge so much. Wellesley gals have expensive tastes. But
she’s worth every cent. And not just for the obvious reasons. Harvard Law.
Writes a lot of our stuff and vets the freelancers.”

“Looks
like you are doing OK.”

“It’s
like stealing money.”

“Again.”

Sink
laughed.

“So
you know about that. Well, I don’t hide it. Actually, it helps me. People
assume I can spot the frauds, having been one. And they’re right.”

“How
did you get into this business?”

“After
I got out of the slammer, I had to start over. Lost my securities license, of
course. But also my family. First wife took most of my remaining assets and the
kids. I don’t blame her. What money I had left was going up my nose. I was
headed downhill until I found Jesus.” He laughed. “Only kidding! Just wanted to
see if you’re paying attention. What I found was Allison, that babe you keep
leering at. Worked for the firm that defended me. Saw a lot of each other.
Wouldn’t marry me until I went straight. She came up with the idea of starting
a newsletter tracking investment fraud. Only I didn’t have to.”

“What
do you mean?”

“One
already existed here in Florida. Guy had a small rag tracking the offshore
banking world in the Caribbean. He practically gave it away so no one took him
seriously. I bought him out and started charging big bucks. I still had a lot
of contacts on the Street. They were happy to feed me dirt on their illegal
competitors, who, after all, are siphoning billions away from their legitimate
scams. Subscribers flocked in. People don’t value information they get for free.
Then came 9/11 and
Offshore
became a must read for the intelligence
community.” Sink spread his arms wide. “And the rest, as they say, is history.
Now, what can I do for you?”

Scarne
liked Reggie Sink.

“First,
let’s get one thing straight. I just paid for you. Not the other way around. I
don’t want anything I tell you to appear in one of your newsletters unless I
say so. Is that clear?”

“No
problemo.”

“What
can you tell me about Victor Ballantrae and his company? I know you have run
some stories on him.”

“Ballantrae,
huh? It’s about time somebody other than us got interested in the bastard.
Mainstream press treats him like Nelson Mandela. But something is rotten in
Denmark.”

“How
so?”

Sink
leaned forward and put his elbows on his desk.

“Let
me tell you about Wall Street. All the crap of the last couple of years – the
huge profits, the collapse and then the bailouts – were the result of so-called
new products, derivatives and collateralized mortgage whatsists. And, of
course, a total lack of regulation, which is insane. You can deregulate the
airlines and safety isn’t compromised because the guys running those airlines
know that nobody will fly if the planes keep falling out of the sky. But
deregulate Wall Street and they don’t care if your investments aren’t safe. The
big guys make money on the way up, and on the way down. Sometimes more on the
way down, cause that’s where the bargains are. And the American taxpayer will
bail them out no matter what happens.”

Sink
stood up and started pacing. He was getting into his subject.

“But
I digress. In the normal course of events, using traditional securities, it’s
tough to beat the market, which actually does level the playing field. Insider
traders can do it in stocks, as I well know. But if you stick to the rules, or anywhere
close to them, you’re not going to be able to separate yourself from the pack,
unless you think long-term, like Buffet. Short-term, there are too many smart
brains doing what you are doing, using the same computers. Of course anyone can
get lucky in one or two short-term trades, but when someone consistently
outperforms his peers, or claims to, I get suspicious.”

“And
you’re suspicious of Ballantrae?”

“He
offers CD’s with interest two or three percentage points higher than other
banks and brokers, including the biggest in the country.”

“Doesn’t
seem like all that much.”

“What
are you talking about? If I’m offering a CD at six percent and you’re offering
one at eight percent, that’s 33 percent higher than me. At low rates, say three
percent versus two, that’s a 50 percent premium. Normally, if one banker is
offering a CD at six, his rival across the street might offer it at 6.1 percent
and throw in a toaster. You might even cross the street for that tenth of a
point. For three points you’ll cross the fucking galaxy.”

Sink
sat back down.

“How
can he do it?’

“He
can’t. That’s my point. He’s doing something that’s not kosher.”

“Wouldn’t
the SEC or other regulators spot that?”

Disdainful
didn’t cover the look Sink gave Scarne.

“Jesus.
Did you step out of the room when I was talking about regulation? There was
none. Now, of course, they’re playing catch-up. But Ballantrae isn’t selling
mortgages. He’s selling CD’s. Too dull for most prosecutors.”

“He
says his bank in Antigua gives him tax advantages that mainland U.S. banks
don’t have,” Scarne said, “and that he can invest overseas for higher returns.
Also his direct sales operations have a low overhead.”

“You’ve
been reading his marketing malarkey. All big American banks are international
and they are all pretty good at evading U.S. taxes. Giving Ballantrae credit
for the direct sales crap, I’d say he could offer, at most, a quarter of a
percentage point over his rivals. On the outside. If the wind is blowing the
right way.”

“A
Ponzi?”

Sink
slapped his hand on his desk.

“Give
that man a cigar! It’s nice to talk to an educated man. Yeah, I think
Ballantrae is running a sophisticated Ponzi, paying high rates to old investors
using cash from new investors who, of course, are lured by those very rates.”

“You’ve
actually run stories about this?”

Sink
shook his head sadly.

“We’ve
run some stuff on Ballantrae that we could document. He’s making a major push
in investment banking and has taken some shortcuts. A few of his brokers and
advisors have been involved in minor securities violations. But he always
disavows any knowledge of their actions and promptly fires them. Nothing sticks
to him. He pays fines and the matter goes away.”

“That’s
it?”

“Here’s
how it works around here. We report lawsuits, court cases, depositions,
administrative investigations and arrests. My interns monitor news agencies,
regulatory and legal websites and blogs for anything smacking of offshore
illegality and we print what we can confirm. We’re not staffed to do much
investigation ourselves. What could we do, when the C.I.A., F.B.I., Interpol,
the S.E.C. and all the rest are overwhelmed by the avalanche of deceit out
there? There’s a trillion fucking dollars floating around offshore! It’s all we
can handle to report the hard stuff. And that’s enough to make me rich. We’re
one-stop shopping for people who want to know who’s been caught doing what. We
don’t print innuendo and rumors. Or my gut instincts. That’s why we don’t lose
lawsuits. If formal charges are filed against Ballantrae, or if he’s even sued
by his investors, we’ll use it. I think Ballantrae is as crooked as my dick,
but he’s got a gazillion lawyers. He’s super litigious. He even threatened to
sue me when I ran some stuff that was already public record.”

They
were interrupted by Sink’s wife, who handed Scarne a receipt and a small
shopping bag filled with newsletters.

“I
gave you the last three issues of all our newsletters,” she said. “You can
access the online editions with a temporary password you can change later.
Instructions are in the bag. More coffee?’

Scarne
declined and thanked her. After she left, he turned to Sink and said, “I want
anything you have on Ballantrae, even what you can’t print.”

Sink
considered that.

“I’m
not real comfortable with that. Your thousand bucks doesn’t buy you that kind
of information. Forget the legal angle. I like to know what I’m dealing with.
Who are you working for?”

“Didn’t
Pourier tell you?”

“Nah.
Just asked me to see you.”

Scarne
told him. Sink’s expression went from benign interest to incredulity.

“And
Sheldon Shields thinks his son’s death is connected to a story he was preparing
about Ballantrae?”

“He’s
convinced his son was murdered by someone. I’m keeping an open mind. If Josh
Shields had proof of a Ponzi, it might be enough to derail Ballantrae’s
investment in Shields Inc. He’d be a real threat.”

Sink
looked dubious.

“Look,
I think the worst about everyone, from Mother Teresa to Santa Claus, but I
can’t see it. Ponzi guys don’t kill people. Madoff, who was facing life, didn’t
go that route. These guys always think they can turn things around, or lawyer
things away. Plus, unless they do it themselves, or have access to reliable hit
men, too many people would know. If the old man is right, it’s gotta be
something else. Something Ballantrae knew would be catastrophic.”

“Any
guesses?”