Whipping Boy (17 page)

“What did you do?”

“I called Sherry.”

The colonel apologized for the oversight and agreed to provide the code over the phone. But before he did, he swore Laurence to secrecy. “He told me the confidential password would reveal the identities of the people whose assets were involved. By this point, I was so agitated I could barely hold a pen. I kept getting the numbers wrong.”

In the end, the colonel sidestepped Badische protocol and faxed Laurence the password: Allied-GMTC-Merrill-Abboud/GPB320-304M=MTN500MU.S.D-7.5%-10YR/180699/BA-ZIH. “When I saw the code, I felt a huge sense of relief.”

“Why? What calmed you down?”

“Two of the names. Merrill suggested a link to Merrill Lynch.
Abboud is the name of a wealthy Lebanese family.” Laurence still rues her lapse of judgment. “I know what I’m telling you makes me sound like a complete idiot. But while all this was taking place, the names made things seem on the up-and-up.”

Contract in hand, Laurence focused her attentions on the second of the two loan requirements—the bank letter. She had thirty days to secure the all-important document. After a few false starts, she obtained a letter from the Dublin branch of Bank of America affirming its willingness to receive the “clean good funds” no questions asked. When, as the loan contract dictated, Laurence requested a face-to-face meeting with the officers of the Trust, she learned that Badische had a policy of conducting all contract negotiations outside the United States.

“That’s when the colonel informed me that he had authorized the Trust’s in-house lawyer, Richard Zeif, to use his diplomatic clout to arrange a meeting at the United Nations. They told me the UN was neutral territory exempt from US law.”

“Did Cesar join you?”

“I don’t think you’re getting it, Allen. Cesar was the shill. Once he delivered me to the Badische boys, his job was over. He moved on. He was looking for the next Barbara Laurence. And he found plenty of them.”

“So I guess my image of Cesar Augustus as an International Man of Mystery is a little off the mark.”

“Just a little. Cesar was more intelligent than some of the other members of the Trust and often better dressed, but I wouldn’t call him an International Man of Mystery.”

“No?”

“No. I think a more accurate description would be”—Laurence
takes a moment to choose her words—“a schmucky, nebbishy lying sack of shit.”

Laurence presented her bank letter to the Badische board in the Delegates Dining Room of the United Nations. Careful to preserve the “comfort level” of the prince, Laurence listened “like a good little girl” as he digressed about his philanthropic work.

“He made a big deal about heading up an order of the Knights of Malta. He said his organization gave big donations to Jewish charities and Catholic causes. Disaster relief. Flood victims. He made it sound like he did something for everyone. Finally, at the end of the meal, I handed the colonel my bank letter. I was hoping to get it approved there and then.”

“I’m guessing that didn’t happen.”

“Good guess. The colonel scolded me for being pushy and rude. But that was nothing new. He humiliated me constantly during the negotiations. He criticized the things I said. The things I did. The clothes I wore. He told me I was too flamboyant, too brash. Well, all I can say is guilty as charged.”

A few days after the UN lunch, Laurence received unsettling news. “Colonel Sherry called and said he was embarrassed by how poorly my bank letter was written.”

The assessment shocked Laurence, particularly since so much of the language had been lifted verbatim from the Badische loan agreement. Undeterred, she contacted the bank officers in Dublin and requested a rewrite. They obliged her promptly but not promptly enough, for now a new problem arose: the thirty-day submission deadline had come and gone. Colonel Sherry remedied the situation by authorizing an extension and waiving the usual penalty.

“He told me he’d forgo the $15,000-per-day late fee the Trust charged delinquent applicants. Then he made me fly to Toronto to deliver the revised bank letter in person.”

“Why Toronto?”

“That’s where he was doing business. He said come to Toronto, so I came to Toronto. I had no choice.”

Laurence met up with the colonel, prince, and baron in the dining room of the King Edward Hotel, yet another five-star landmark. Her second petition for funding repeated the pattern of the first: lengthy meal filled with rambling royal pronouncements followed by formal submission.

The Trust was nothing if not thorough. Colonel Sherry had Laurence’s second bank letter vetted by attorneys at firms in the United Kingdom, the United States, and Switzerland. He then used their legal reservations to downgrade her contract to “nonperformance status.”

“When I got that news, it was worse than passing a kidney stone,” Laurence recalls. But pass it she did, and a few days later she petitioned for another extension. This time the colonel informed her, by fax, that Badische would only reinstate the contract and grant a thirty-day extension upon receipt of £100,000.

“One hundred thousand pounds! I was furious. All these hidden expenses were leaving me with very little breathing room.” After much discussion, Laurence negotiated less onerous terms: £10,000 up front, with the balance due two weeks after the $500 million deal closed.

But the late fee constituted only one part of her penalty. “Colonel Sherry said something to me I will never forget. He said, ‘When my little girl does something wrong, I spank her. What kind of spanking should I give you?’”

“What did
that
mean?”

“I was required to submit a handwritten apology to the board of the Trust.”

“You’re kidding.”

“No. And what’s worse, Sherry kept forcing me to rewrite the thing. It was like I was back in grade school.”

The punishment reminds me of the Aiglon pensums, but I keep that thought to myself. “How many times did you revise the apology?”

“I can’t remember. All I can tell you is each rewrite was like pouring salt in a wound. Eventually, Sherry dictated what he wanted me to say word for word.”

I quote back to Laurence a large chunk of the mea culpa she was forced to submit to the Badische board:

In all of our meetings, you’ve exhibited the highest level of integrity and good will towards me and my endeavor. I hope that you can find it in your hearts to accept my most sincere apologies for this delay and unintentional indiscretion, and consider granting my request for an additional extension of time.

Your continued belief in my project, and the care and caution taken by you and your council, is of great comfort to me. I look to you and your esteemed colleagues for direction.

I hope this correspondence in some way conveys to you my deepest feelings of regret for causing any discomfort or hardship. If given the chance, I am sure that you will not be disappointed by my continued efforts.

“They certainly weren’t disappointed by my continued efforts,” Laurence says. “Not at that point anyway,” she adds. “The apology letter and late fee bought me another month.”

With the clock reset, Laurence hopped a plane to Paris to consult a corporate lawyer with ties to ING. “The Dutch bank was one of the few specifically endorsed by the Trust.” Laurence spelled out her predicament to the French attorney. “He was super well connected and wrangled an appointment for me with senior executives at ING in Amsterdam.”

The prospect of a half-billion-dollar deposit, as well as the
reputation of the Paris advocate, made the Dutch bankers receptive. “They even put a rush on the background checks.” Two weeks ahead of deadline, Laurence had yet another bank letter in hand. “And this one was bulletproof. I faxed a request for a face-to-face meeting with the Badische board that same day.”

“And what happened?”

“Nothing. I never got a response.”

Laurence waited three days before sending another fax. It, too, went unanswered.

“Why the silence?” I ask.

“That’s what I wanted to know. I called Gurland in London to find out what was going on. He said the colonel was incommunicado. Something about hush-hush business at the Vatican. I couldn’t learn more. Finally, on the day of deadline, I got a reply.”

More precisely, Laurence received
two
replies, neither of which came from Sherry. The first, a fax transmitted by Robert Gurland, informed Laurence that she was “in default” and that Badische would be returning her £10,000 late fee. The second notice, also sent by fax, and bearing the armorial shield of the House of Badische (spread eagle and lions rampant), was less terminal in tone than the legal communiqué:

               
Dear Ms. Laurence,

               
By the time you receive this, you have had other communications, which are self-explanatory. I suggest that in order to proceed with our mutual aims, we meet once again. Perhaps between us we can find a solution that would be reciprocally beneficial.

Most sincerely yours,

Dr. G. Moncrieffe
       

The baron insisted Laurence meet him in Liechtenstein.

“I said, ‘
Liechtenstein?
Where the hell is Liechtenstein? Who wants to schlep to a place you can’t even find on a map?’ The baron told me, ‘Hey, look, I could have made you to come to China!’”

Desperation again rendered Laurence submissive. She flew to Zurich and hired a chauffeur to take her to Vaduz, the capital city of the tiny, hard-to-locate tax haven. On the way, her limo blew a tire. “To make the appointment, I had to help the driver fix the flat. In the rain!”

Things went from bad to worse once the meeting started. It wasn’t long before the baron, the colonel, and Richard Zeif, the Trust’s in-house counsel, began interrogating Laurence about her professional ties to a disgraced rabbi named Rachamim Anatian.

“They were super aggressive. I told them I was his former employee. That he owned GSN, a television shopping network that was on the air for two years before filing for Chapter 11. I told them I was the network’s president. But they knew all of that from the meeting at the Waldorf and from information I gave to Cesar during the vetting process.

“Zeif kept pressing me. He said, ‘Isn’t the rabbi in question the subject of a ninety-six-count indictment? And didn’t you conspire with him?’”

Laurence acknowledged that her former boss had acted in a “disreputable manner” and that he had fled to Israel to avoid prosecution. But she expressed outrage at the suggestion that his improprieties in any way tarnished her reputation. “I had provided Cesar with documents, signed by a judge, releasing me from all wrongdoing associated with the bankruptcy.”

That might be, Zeif countered, but Badische wasn’t about to risk its good name by conducting business with someone who conducted business with an alleged felon.

Once more, the long-suffering TV executive was given her marching orders. “They told me, ‘Get us evidence that that you’re not a criminal.’ That’s like asking someone when he stopped beating his wife.”

Laurence persevered. “I went to visit—this is so
embarrassing
—all these people and had them write character references. I had background checks done stating that I had no judgments against me. That I was never convicted of a crime.”

“What happened after that?”

“I delivered my ‘honesty package’ and never heard another word from the Badische boys. That’s when I decided it was time to cut my losses.”

Laurence contacted Gurland and demanded the return of the $500,000 performance guaranty wired to a bank account he managed on behalf of Badische. His assistant dispatched a terse reply: “All communication with regard to the transaction with Badische must be done through Colonel Sherry as Robert Gurland has no official position or authority in this matter.”

“I’m not the type of person who likes being blown off.”

“I’m getting that impression.”

“I contacted the colonel while he was supposedly conducting loan negotiations in the Far East and made it clear that if Badische failed to return my escrowed deposit, I would go to the authorities. Sherry lost his cool. He said, ‘I don’t know how you can talk to me that way! Haven’t we had a wonderful relationship? I’m
really
hurt!’ He acted like
he
was the victim.”

Unmoved by the histrionic deflections, Laurence petitioned the baron for the half million dollars. He proved more receptive. “Boy, did he change his tune once I started threatening to make a stink. He said he’d meet anywhere I wanted to remedy the misunderstanding. So I said Bermuda. I was going there anyway for my anniversary.”

The final showdown between the Baron Moncrieffe and Barbara Laurence (before their three-week reunion in federal court) took place at the Ariel Sands, a beachfront resort owned in part by the family of actor Michael Douglas. Laurence wore sandals to the rendezvous. “The baron wore Ferragamos and spats.”

Some ten years later, Laurence still remembers their exchange:
“He was extraordinarily nervous. Running off at the mouth. He confessed that he had never wanted to go into banking. That for much of his life he had resisted the profession, even though the Moncrieffe clan had been in banking since before there was a Wall Street. He confessed that he much preferred attending the Paris collections with his mother and the knighting ceremonies overseen by his two mentors, King Peter II of Yugoslavia and Prince Robert.”

Laurence tolerated the baron’s digressions but refused to be distracted by them. “I told him, ‘I want my money back.’”

The baron said he appreciated her position, and apologized for the indignities she had suffered, admitting that he didn’t always see “eye to eye” with the methods of the colonel. He went on to say that the bond market had changed significantly and that fluctuating interest rates and the volatility of treasury offerings would make it difficult to execute the loan under the original terms. Difficult but not impossible. He assured Laurence that if Badische couldn’t fund the transaction, he would underwrite the $500 million loan personally. “I said, forget the $500 million. All I want is my $500,000.” Laurence added that if Badische didn’t make her whole, she would take legal action. The baron promised her that the performance guaranty would be returned. After all, he noted, “attorney bickering” was the last thing anyone wanted.