Читать книгу Deadly Game - R. B. Conroy - Страница 10

Chapter 4

“Good morning!”

Startled, Alex wheeled around from a rear file cabinet to find the squatty Barnes O’Brien hovering over the front of the desk. As he had done so many times in the past, the brash man had taken the liberty of entering Alex’s office without announcing himself to Erica.

“Oh…uh good morning, Barnes, good to see you.” Alex quickly stood, the two men shook hands.

“Hope I didn’t alarm you. The door was open so I just came in.”

“Certainly not, Barnes, I was expecting you. And how are things at O’Brien and Son?”

“We’re makin’ money.” A tight grin broke out on Barnes’s round face. Originally from the Boston area, Barnes O’Brien had moved to Indianapolis some twenty years earlier at the urging of his wife, Dora, an Indiana native. He immediately opened a law firm, hanging his shingle on a fourth story office in the Market Tower Building. A gifted trial lawyer and brilliant before a jury, he soon acquired a reputation as a gritty, and sometimes ruthless, adversary in the courtroom. Aggressive and smart, he eventually acquired offices in several major cities in the Midwest, including Chicago, St. Louis and Detroit. And like most attorneys, he donated generously to the Democratic Party. Rumor had it that he was in line for an Ambassadorship to Ireland. Barnes’s son, Shawn, joined the firm two years ago after graduating from Indiana University School of Law. A dedicated family man, Barnes was thrilled when his only son took a position in his firm. Plus, the addition of Shawn gave him more freedom to pursue his political ambitions.

“How’s Shawn?” Alex liked Shawn, a congenial and friendly young man—he was nothing like his opportunistic father.

“That kid of mine really knows his stuff.” Some-what sensitive to the lackluster reputation his son was garnering in legal circles around town, Barnes never missed an opportunity to sing his son’s praises. Alex understood and appreciated his commitment to his son.

“He seems like a bright young man.”

“He kicked Bob Brown’s ass the other day—got a huge settlement for our client in that asbestos case.”

Alex smiled broadly, “Hmmm, that’s good. Brown’s a good lawyer. It’s no easy task to win one from him.”

Actually, Bob Brown had been a wonderful liability attorney at one time, but after years of hard drinking and a couple of debilitating strokes, he was a sad case—often treating the jury to lengthy nonsensical diatribes in the courtroom, while using his wadded, yellowish hand-kerchief to swipe away streams of drool falling from the corner of mouth. The well-known litigator had become, more or less, a joke around town.

“The kid’s getting there, sure enough is,” Barnes lifted his chin proudly.

Alex nodded.

After savoring his somewhat over zealous comments about his son for a moment, a sober look fell over Barnes face. “That’s enough about the boy. We have much more serious matters on our plate.”

“Yes, and….”

Barnes interrupted, “Alex, we’ve beat this TARP issue to death, so there’s no need for us to rehash all of the tedious details. Why don’t we just get to the bottom line?” He paused briefly and looked directly at Alex.

“Yes…yes I agree Barnes, I….”

Not wanting Alex to set the agenda, Barnes interrupted again. “This bond market is not going to rebound completely for some years. The traders are still cautious and yields on mortgage-backed bonds are still failing at an alarming rate. And when our commercial paper starts going bad, as we all know it will, we could be in serious trouble. I can….”

Slightly agitated, Alex took his turn at interrupting. “Our commercial portfolio is doing fine Barnes. Except for a few small ma and pa deals, we have no major problems with any of our commercial loans. We have underwritten these loans very conservatively over the years, only working with the best managed and most solvent businesses. I’m not saying we’ll never take a loss, but overall, our commercial paper is some of the best in the business—no doubt about it.”

The aggressive Barnes shot up from the desk. “That’s bullshit, Alex! The way this market is heading we could experience tens of millions in commercial losses. This market is going to continue to deteriorate and local businesses will start to fail. Combine that with our bond problem and we’re headed for a disaster. And whether you like it or not, we’re going to need the deep pockets of the Federal Government to stay afloat. If you don’t see that, you’re fooling yourself!”

Red crept up Alex’s face, “Not so, Barnes! We are in trouble today because we got too deep into the Freddie and Fannie stuff, and you led the charge, my friend. That’s why we’re in this mess!”

The hardened trial lawyer, used to emotional confrontations, smiled coolly at the fuming Alex. “The board proposed to get more aggressive in the secondary market last year and you said yes.”

“Yes, I did, Barnes, but only after the board agreed not to do subprime mortgages. I was adamant about it, but somehow those requirements were changed while Nicky and I were vacationing in Europe.”

He paused, his eyes fastened on Barnes. “I just discovered from our auditors that we have been doing subprime mortgages for over a year. I feel like I have been duped. Somehow, the motion to loosen our guidelines was never mentioned in the minutes of that emergency meeting.”

“Are you accusing me of purposely omitting something from the minutes? That’s a very serious accusation, Alex.”

“You were Secretary of the Board at the time. Show me in those minutes where subprime mortgages are mentioned.” Alex was now staring bullets at the hardened lawyer.

Undaunted, Barnes gritted his teeth and continued, “While you were off vacationing, First Financial Securities informed me that we were having problems delivering the required number of Freddie securities to our institutional investors. Our investors were screaming, so I asked Strom, Chairman at the time, to call the emergency meeting. During the meeting, I made a motion that we explore ways to acquire more mortgages so we could adequately fund the bonds. I left the decision on how to do this to the originating department of our subsidiaries. They made they call.”

Alex leaned up and began pacing behind his desk. “You what? You left it up to the subsidiaries and their originators?”

“Why certainly, they’re our front line for making loans.”

“They work on commission, Barnes! They’re going to make any loan they can get their hands on, subprime or whatever. Why in the hell wasn’t I told of this decision?”

“It’s in the minutes of that meeting.”

“The hell it is! I’ve combed over and over those minutes. The only reference in the minutes is a com-ment by you that our investors were getting nervous and that we had to be more aggressive in our originating offices. That is a hell of a long way from allowing street originators to make policy!” Alex turned and glared at his paunchy adversary. Alex seldom swore, the use of profanity several times underscored his contempt for Barnes.

“Strom said he called you and brought you up to date.”

“Barnes, you know that Strom knows very little about the secondary market. You had him call me because you knew he didn’t understand the implications of the actions you had convinced him and the board to take. He doesn’t know a subprime mortgage from a car loan.”

Alex walked to the front of the desk, “But you do Barnes, you know the difference. You also knew that when the green light was given to our originators, they would jump on the chance to make subprime loans. Their commissions would sky rocket. And you also knew that by wording the minutes they way you did, that I wouldn’t know of it until literally hundreds of millions of bad mortgages had been made and then pooled together into bonds. It’s a disgrace Barnes, and you know it. Your actions may have single-handedly put Midwest in financial jeopardy.”

Barnes stoic exterior couldn’t hide his anger. The right side of his broad mouth curled up in a smile, “You were informed of the meeting and I thought surely you would understand the nature of things—you are a very bright man. We had obligations to fill. Vito was getting nervous. We couldn’t wait.”

Eyes wide, Alex continued, “Now I see.” He looked away from Barnes. “It’s all clear now. It’s so damn clear and I’ve been such a fool.”

“What are you talking about?”

“It’s all about the money. Once again, it’s all about the stinking money! You and Vito and money! Isn’t it convenient that you and Vito have offices in all seven of our major markets?”

Barnes stood straight and puffed his chest. “Hell, that’s only good business Alex. We need to have local securities dealers, the regulations are different in every state, and you know that.

Alex’s eyes narrowed. “I can’t imagine the amount of money that you and Vito have made over the past several months. It has to be in the tens of millions.”

“You knew First Financial was one of the dealers we used to package our loans. That was no secret,” Barnes said cautiously.

“Yes I did, but I didn’t know they had opened offices in all of our major cities. The St. Louis manager told me about it the other day; it didn’t smell right then and it still doesn’t.”

Alex shook his head disgustedly. Alex took great pride on always staying on top of things; it was humiliating to admit how Barnes had manipulated him. “I feel like such a fool,” he murmured.

“There’s no law against First Financial opening an office in another city. And as far as that board meeting goes, the minutes clearly direct a change in policy. If those minutes were challenged, you wouldn’t have a leg to stand on. There has been no wrong doing here, Alex.”

“Oh I’m sure a man with your great legal mind has thought this through. I would be a fool to challenge the legalities of this situation, but what you have done is despicable. You have put this institution in financial jeopardy for your own selfish greed and political ambitions.”

Barnes pushed his narrow rimmed glasses up on his nose and tilted his head. “We weren’t the only one that was struggling, there were hundreds of other banking institutions that took that bailout money to help cover their losses.”

“Maybe so, but I’m still running this bank and you and Vito have done enough damage. The money will be paid back if I have any say in it.”

Seething, Barnes forced a smile and turned to leave. “The bottom line is that we can’t afford to pay back that money. It won’t happen because I have the votes to stop you. You better jump on board, Alex, before it’s too late.”

Alex was stunned by the ‘I have the votes’ comment.’ He stood motionless as Barnes exited the room, leaving him alone with his thoughts. As usual, what had started out as a way for Alex to force Barnes into a corner had turned out to be a win for the crafty lawyer.

“He’s done it again,” he whispered. He pushed a line on his desk phone.

“Erica.”

“Yes?”

“Get me Strom on the phone, right away.”

“Right away.”

Alex pushed his chair back, leaned down and opened his lower right desk drawer. He pulled out a file containing the minutes of the past several board meetings. He hurriedly dropped it on his desk and began scanning the contents. A short time later, Erica’s speed dial light began flashing.

“Yes.”

“Strom is on line three.”

“Thank you.” Alex impatiently jabbed the button. “Hello, Strom.”

“Yes, Alex, and to what do I owe the pleasure of this call?”

“Barnes just left and we had a little heart to heart.”

“And how is Barnes?”

“His usual charming self.”

There was a nervous chuckle on the other end.

“Strom, I’ll make this short and sweet. He just told me that he definitely has the votes to approve keeping the bailout money. Is that your understanding?” An accomplished multi-tasker, Alex continued to read through the minutes.

There was a pause, “Why no. It is true that old Seth Boardman and Jack Mathews are firmly on board with Barnes. But I really feel I have convinced Cliff Williams and Lisa Carl to vote our way.”

“Hmmm…it must be Lisa.” Alex lifted a copy of one of the minutes for a closer look. “Barnes wouldn’t show his hand unless he was certain he had the votes.”

“That’s for sure. Maybe it is Lisa.”

Alex flipped the page of the minutes. “I may be onto something here Strom. At the board meeting on June 15^th, Lisa seconded Barnes motion to accept the money. It’s not much, but it is an interesting second.”

“That’s for sure.”

“Have you polled the members lately?”

“Yes, I polled them at the last meeting, and I…”

Alex interrupted, “Was that just before Barnes and I got there?”

“Yes….yes, I polled the members just before you and Barnes arrived. When I asked them, in confidence, who was leaning toward voting in favor, Seth and Jack raised their hands and Cliff shook his head in the negative. Lisa was texting someone on her cell phone and didn’t reply. Now that I think back, she may not have even heard my question.”

“Uh…huh, she didn’t answer so you assumed she was not in favor.”

“Yes exactly.”

“Very interesting, it looks like Lisa may be the deciding vote and Barnes thinks she’s in his camp.”

“Probably so, he’s good friends with her husband, Ed Carl. But on the other hand, she has voted your way many times. I think she has the hots for you.”

“Looks like she might have the hots for Barnes right now.”

“Maybe so.”

“I’ll be in touch, Strom. In the meantime, please don’t talk to anyone about this. I think we may have a problem here.”

“Okay, you know where to reach me.”