Chapter 9: Bill

No one else ever came up to this room. In fact virtually no one other than the landlord was even aware of it's existence. It was an office on the 57th floor of the Sears tower in Chicago. Well, it was really much bigger than an office, but contained only one desk, a separate computer console and several phones. What really made the room different was the fact that there were no windows or doors, and every scrap of wall surface was occupied by giant white planning boards with plug in slots. Normally such boards are used to plan large projects or military activities where the planner would insert letters or banners to make up a list of activities, but these contained banners with the names of hundreds of stocks arranged in columns under various headings. If one looked closely one could not help but notice that the columns were each headed by the name of one of the fifteen funds in the Merkel group portfolio, each subdivided into “sell” and “buy“. The only entrance to or exit from the room was via a stairway which led down to the 56th floor to a door leading into the rear of a shower room. From the shower room the door for all the world looked like a full length mirror indistinguishable from other mirrors just like it in the room. The shower room was part of the private toilet facilities attached to the office of the manager of the aggressive funds division of the Merkel Group - Brad Layton.

It was well after midnight and Brad was in the room above his office and he was annoyed. He had remained annoyed since the time two nights earlier when he found out about Bill’s stupid mistake. “I just asked him to OK that new account with Fraser.” He muttered. “We needed another broker, as some of the other guys were getting suspicious. He really blew it!” He really was an incompetent, that Bill, but it was that fact that allowed Brad to get away with all that he did.

Bill was nominally Brad’s boss, the former being the vice president in charge of Merkel’s Mutual Fund Management Division, while Brad headed up the five aggressive funds that made up roughly a third of the total in the group. Brad had joined Merkel in the early nineties, as a result of a merger, and had never resolved his disdain of the amateur approach of the Merkel staff, particularly the family members, in which company he included Bill, even though he was only a member of the family by marriage. On the other hand, Bill put up with Brad’s attitude mainly because he had the Midas touch, with the funds he managed regularly beating the indexes by a hefty margin. As Bill’s bonus depended upon the performance of the entire group’s portfolio, Brad was making Bill rich in his own right, which was just as well because his mother in law gave him little access to the vast fortune she had inherited from her father.

Brad would be in the private room for several hours every week moving around the columns, removing a banner from this fund and moving it over to another. After each move he would stop at the computer or the desk, scribble or type a few short notes and proceed to the next board. When he was done he would have moved perhaps ten percent of the banners from one position to another, and perhaps another one percent would be moved to the column headed “other.” This evening, as he did every time he came here, he finished off his activities by dialing out on his computer and sending a series of emails.

Having finished for the night, Brad took a quick shower, picked up an overnight bag that he had packed that morning before he left home, and headed straight to the airport to catch an early flight to Miami, where he was scheduled to pick up a BWI flight to Nassau, in the Bahamas. He was pleased it was so early, or late whichever way you wanted to look at it, so the highways were almost deserted, making the trip to O'Hare a mere twenty five minutes.

Brad liked the early morning flights, they were usually on time, at least at departure, and airline delays were one of the things that sent his blood pressure soaring, hence his route, American to Atlanta, then BWI to Nassau was as painless as it could be. He traveled as little as he could, but this junket was a sales rewards program for agents of the Merkel funds around the country, and everyone there would want to touch the hand of the guru. The conference was actually organized by one of the “professional” organizations that provided training for sales agents, and Merkel and other fund groups paid for agents to attend the conference as a reward for selling a target amount of their fund units. Brad smiled as the limo pulled up at the terminal, amused at the thought that investors bought his funds because agents who were rewarded by the fund manager advised them to. True his funds were doing very well, but that was because his personal bonus depended on their performance, and he made sure that he was well remunerated! Well he would go and press flesh with the dupes, no big deal, and in any rate he had another more important reason for attending the conference.

Jose was also en route to the Bahamas, but he was not going to fly BWI. The private jet he was in had left Marathon airport in the Florida Keys with a flight plan for Boston. As expected the flight controllers at Miami had pushed the plane way out over the Atlantic ocean to avoid any congestion over the busy hubs of Miami, Ft Lauderdale, and West Palm Beach. No one would notice as the plane disappeared off the edge of the radar screen for a few minutes as it landed at a remote strip on the islands. Here Jose disembarked and continued his trip to Nassau in a luxury go-fast boat, a sixty five foot Scarab, while the plane loaded a couple of unmarked crates and continued its flight to Boston. The plane arrived only 20 minutes behind schedule, surely no cause for comment. Being a nominally local flight there was no need to clear customs, and the jet simply taxied up to a freight terminal, where the crates were re-consigned to New York, no questions asked. The occupants of the plane were not surprised at how easy the deception had been. They did this trip or one like it several times a month, and only rarely were they given a routing by air traffic control that did not permit them to deviate just a little from their declared route.

Back at the Hotel Atlantis, on Paradise Island in Nassau the conference was in full swing. Lectures and presentations were going on in three separate halls, and in each there were a smattering of delegates. Attendance at the training parts of the program was always thin, as the competition from sponsored social and sporting activities was fierce. Offered a choice between playing golf in a pro-am tournament with thousands of dollars in prizes and a lecture on the linkage between the Dow industrial index and weather in the mid west, most delegates had little trouble deciding that the exercise would be good for them.

There was one room however that was having a lot of traffic. It was not listed as a public room for delegates, but invitations to attend the meeting there this afternoon had been circulated several weeks earlier. The room was actually part of the suite occupied by Jeff Rosenberg, the managing guru of Franklin Capital, a mutual funds group based in New York. Jeff had hosted these gatherings twice a year since 1992, with the number of invitations increasing each time till now there were nearly fifty. The meetings were always short, partly so that the attendees would not be missed for too long, and partly because, once they had accepted the purpose of the meeting, there was not that much more to talk about. No one was ever invited here until they had been carefully, assessed, and pre-approved.

Jeff called the group to order exactly at 3 o-clock, “OK everybody appears to be here. We have two new members, and we have lost one. The new stocks selected by your votes are given in the papers on your desk. In the drum as usual are forty nine cards with a fair division of the names of the new stocks, and the amount we expect you to hold. Remember, everyone has agreed to actively work the allocation he has been given.” Nothing more need be said, the news of Fred Alyston’s skiing accident was still fresh in everyone's mind.

Brad was one of the longest standing members of the group, and he wanted a word with Jeff, so he held back as each of the others filed up, collected a random yellow card from the drum, and left the room. When they had all left, Brad said, “The system has worked well, but it irks me that so many non members are benefiting from our endeavors. We take all the risk, why should we not get more of the benefit?”

“Don’t be too greedy,” replied Jeff, “it’s all part of the equation. We manipulate some stocks up, the market climate improves, all stocks benefit, and we get a double whammy, the rest of the players get only one.”

“I take your point. But that's not really what I wanted to talk to you about. I got trouble with Bill Fernstine, our executive VP. He keeps asking too many questions, obviously suspects something, and then, only this week, he got an insider tip on a stock and let it slip out. He’s a loose cannon. If they start to investigate him, who knows how deep they will go, and who may be next.”

“I’ll take care of it.” Jeff turned to pick up his phone as he answered, a clear message to Brad that he was dismissed. Fuming just a little at the curt termination of the visit, he left the room mollified by the thought that Jeff’s probable solution to the Bill problem would not be bad for his own career.

An hour later, Jeff carefully checked the corridor leading to the penthouse suite. Access to this part of the hotel was restricted for security reasons, one needed a key for the elevator before one could even get to this corridor. Even so, Jeff did not want to be seen entering the suite occupied by Jose Ramirez. When he was certain that the coast was clear, he walked quickly to the door, which opened before he could knock. Obviously whoever opened the door had been watching. This did not surprise Jeff, because he had known Jose for several years now, and knew that he was extremely careful. As Jose often joked, he was allergic to surprises; in his business, surprises were often fatal.

Jose greeted Jeff warmly, clasping his outstretched hand at he elbow and giving him a quick hug in the Hispanic way. This served to give Jose the opportunity to quickly check that Jeff was not carrying a concealed weapon, and to signal to the hidden observers that all was well. “So Jeff, what gives? When can we move things up a notch?”

“Come on, Jose, we already move forty mill a month, and we‘ve only been operating for eighteen months. We don't want to blow it all by being to aggressive.”

“OK, but understand we need that sort of volume in a week.” They moved on to small talk while having a cocktail, and then prepared to part.

“Before I go Jose, I need another favor, just like the last time. The details are all here. As soon as possible.” Jeff handed Jose an envelope.

“No Problem! All the more reason for us to increase the volume.” Jose made it sound like a suggestion, Jeff knew it was an order, and he knew it was an order he would not refuse, frankly because as risky as it was, the arrangement was altogether too lucrative. Jeff also knew that getting the kind of favor he needed every now and then was not that easy, one needed a special sort of friend, one like Jose.

When he returned to his suite Jeff began to prepare a general circulation email:

To: Mutual Funds Retail Outlets List

cc: JR

From: Jeff Rosenberg

Subject: Increased Volume from Special Accounts.

Our special accounts clients are eager to increase their investments with us. Each branch can expect weekly investment to increase from $20,000 per week to $50,000. We can thank the exceptional performance of our product for this increase.

Prepare to adjust your banking schedule to daily deposits of $10,000.

Although Jeff had carefully managed the program building his cash deposits from a couple of grand a week per branch, up to the current twenty, he was always cognizant of the banking practice of reporting all large cash transactions to the authorities. Not to attract suspicion, he ensured that individual branches held each deposit below the critical $10,000 mark. Already the operation required him to operate five hundred branches scattered around the major cities on the east coast. However his branch managers were easy to recruit, their ten percent commission paid in cash was ample reward for meeting one client a few times a week, and making a trip to the bank twice. Any sales of mutual fund units they did make to other walk in clients was pure gravy. The managers may have had more reservations if they were to compare notes with each other and discover that every branch’s client was making a unit purchase credited to one of only two or three account numbers.

Already, at the end of each month, Jeff would personally process a unit repurchase order for another commission of ten percent, and issue a draft to a Cayman islands bank of the proceeds. JR, Jose Ramirez, got thirty two million dollars free and clear, while Jeff Rosenberg, kept a cool four million, and his agents split another four. With the proposed increase in activity, Jeff’s take would grow to fifteen.

Figures like this were enough to make a normal persons head spin, but for Jeff, there was no longer such an effect. For him, making more money was now an obsession, a dull aching pain deep in the gut. Every million more, simply created a desire for another two, the need could never be satisfied. Long ago he had accepted that his drive had pushed him over the line between ethical and non-ethical, from which it was a short step to the line between legal and illegal. Exactly when he eventually reached the point of not being able to even recognize that what he was doing was quite candidly criminal, he was not sure. When he had had the first man killed in his quest for more, he had known there was no return. He had chosen his course, and he would continue on that road until he was stopped. Stopped by someone else whose thirst for money and power was more strident than his, and to stop him they would have to kill him.

Jose didn't use email, and he didn't need to. As Jeff had left the suite, two hidden forms emerged, both clearly having just pocketed their weapons. One could never be too ready. Jose turned to one of them, a short stocky man, “Sort this out by Monday night, you’ll need to go to Chicago.” He handed him the envelope Jeff had brought. He turned to the other, “Get the word out that we will soon move more product through the Frankie organization.” Done, a life and death decision, and a fifty million dollar a month organization change all in one minute. No wonder the business world could not compete.

Finished with his business in Nassau, Jose announced, “I’m going fishing,” and made his way to re-board his Scarab. The ostentatious boat was clearly a rich mans toy, three massive noisy outboards each packing three hundred horsepower mounted on the rear of sixty five feet of shiny red white and chrome. Every pair of eyes watched as the sleek vessel moved slowly out of the protected harbor, waiting till it reached open water before opening the throttles. As the engines opened up, the throaty purr changed to a menacing roar, and the boat seemed to climb out of the water, only the rear quarter of the hull remaining in contact with the sea. Heading first west then south, the craft soon disappeared from view as it merged with the approaching darkness.

By just before dawn the Scarab was trolling for the big ones just to the south of the gulf stream, perhaps fifty miles off the Florida keys. In the darkness no one would notice an inflatable dinghy with two men on board, drop into the water and watch the Scarab troll off into the night. The spot had been chosen with care, just on the fringe of the favorite fishing zones for boats out of Marathon and Islamorada. Seemingly only minutes after releasing themselves from the Scarab, the occupants of the dinghy waited as a second boat, a thirty two foot Parker, emerged from the darkness and carefully approached the dinghy. In less than a minute the dinghy and the men were safely on board, and the boat resumed trolling speed. The dinghy and its contents of plastic wrapped bricks were carefully stowed out of sight, but sufficiently accessible to be dumped overboard in a hurry, should the need arise.

Speaking in Spanish, Jose greeted the captain of the Parker, “How goes it Juan, any problems?” “Looks all clear, heard some traffic earlier about a boat load of Cuban refugees down near Big Pine. That will keep the coast guard busy.” The traffic he referred to was radio traffic which they monitored continuously, and the boat had a small radar upon which only the disappearing Scarab was visible. They relaxed a little, but knew they could not let down their guard completely because this area of the ocean was constantly monitored for suspicious craft. Juan was not really worried; he did this trip six days a week, most days not picking up stray dinghies, and was well known as a respectable dolphin fisherman. Dolphin, or Mahi Mahi as it is known in most parts of the world, is a major commercial fishing industry in the keys. He moved his troll route closer to the islands and ten miles from the hump, which is south of Marathon, and they soon picked up a school of the fish. Three of the four troll lines had fish on after the first hit, two of which were quickly brought on board. The third was left in the water being played backward and forward to create the impression of a feeding frenzy, while other baits were thrown out. In just thirty minutes the five men on board had boated fifty-seven fish ranging in size from twenty to eighty pounds. Lucky they had the two extra hands on board that day, it made it possible to get the best out of a great school of fish! A good days work, a lot of fun, and now they could move on to the real purpose of the trip.

Juan moved his troll lines closer to the commercial shipping lanes where the water depths were around four hundred feet, at the same time watching his GPS. He also activated a sonar listening device. As the boat approached a preset position on the GPS, faint clicks were heard on the sonar, sounding very much like a passing porpoise or dolphin (one of the mammal variety). Juan switched on a little radio transmitter, just like the ones used for controlling radio controlled cars, pressed a button and waited. In perhaps thirty seconds, amid a flurry of bubbles, an inflated rubber ball emerged from the depths just fifty yards away. The prize had been waiting on the sea floor for a few days with the balloon float deflated. The radio signal had caused it to fill from a small cylinder of compressed air, and bingo, it floated to the surface. It was quickly snagged and brought aboard, as was the trunk sized package hanging from a short line underneath. “I love working with Jesus,” said Juan, “his drops are always spot on the money. Now some of the others, takes days to locate their packets. Those sonar transmitters only have a range of a few miles, so it‘s real easy for us to miss, but it also means the snoopers will have a hard job also”

“I’ll tell him next time I see him, I should be in Haiti next week.” Jose had actually been quite impressed at the efficiency of the operation. He hadn’t been on one of these import trips in a while, and enjoyed the improvement technology had made to the business. When he was actively doing this kind of thing himself it had been an art, carefully plotting your position by the stars, then dragging the bottom, admittedly in shallower water, with grappling hooks. But back then, the technology the coast guard had used was much inferior also, so maybe the balance was still status quo. Then they never found some thirty percent of the packets, today retrieval was closer to ninety percent, and what was lost was usually lost to casual fishermen who inadvertently hooked in to an unexpected load, a so-called square grouper.

They unloaded their fish cargo at the fish house on Boot key harbor, then tied up alongside a trailer sitting on the banks of a canal. The second cargo was stashed in the trailer, then Jose called Greta to pick him up. “Had a good day,” she asked as they drove the short distance to their beautiful but relatively modest home in Sombrero Beach. This was their official home, but they spent little time here. Their working home, where they resided during most of the time they spent in the area was further down the keys on Summerland Key. Here, on a side road rarely used by anyone they had a fifteen acre compound completely shielded by dense mangrove hammocks, accessible only through a locked gate. When living here in Marathon they were known as Gus and Lourdes Delatorres, who had come to the US from Nicaragua during that countries war. It had been easy to get residency documents as a refugee, and his frequent humanitarian visits back home did not arouse any suspicion. For the outside world, he had, of course, made his money in bananas, losing his estates to the Sandanistas.

In the morning before daybreak, Jose and Greta drove the twenty miles down the keys to the Summerland key estate. They were dressed as fishermen preparing to spend the day bonefishing. Completing the illusion was an eighteen foot Hewes flats boat on a trailer behind the Land Rover SUV he drove.

Once inside the compound all need for discretion fell away. One look at the fortifications hidden in the mangroves made it clear that no one was going to be inside that enclosure that was not wanted there. In the center of the estate a long shed lined a weathered dock, and piles of lobster traps were scattered around. Isolated on the left was a luxurious hexagonal shaped building carefully surrounded by taller trees to ensure it would not stand out to a casual observer, while on the right was a line of small cottages which would be reminiscent of any Caribbean resort. Tied up at the dock were a number of chunky looking boats, indistinguishable from the hundreds of other lobster boats that plied these local waters. Also there were several boats similar to the Parker which Jose had been on the day before. Obviously this was a successful fishing operation.

Jose pulled into a lean to adjacent to the shed, and went inside. One half of the area inside was exactly what one would expect, there were ice machines, fish cleaning and packing equipment, and lots of fish and lobsters. However, at the other end of the building was a glass partition, and inside the people wore surgical face masks and white laboratory overalls. Here nothing was scattered. On one side was a neat pile of bricks wrapped in plastic, to which pile Jose could see Juan adding yesterdays haul. In the middle were laboratory mixers and other equipment , and on the far side was packing equipment and materials. The raw 100% cocaine that arrived in the blocks was too concentrated, and it was adulterated by mixing with glucose. The mixture was then packed in smaller plastic packets, wrapped in waterproofing plastic, then stashed in fish crates and covered with ice. After fresh filets of grouper or mahi mahi were added the crates were ready for shipping in refrigerated fourteen wheelers all up and down the east coast.

A final detail in the shed were two sleek go fast boats, these not of the luxury type, but plainly working vessels. Moored out of sight, fueled up and ready, in the case of an emergency, they could be in Cuba in forty five minutes.