Informant (22 page)

Walking into the room, Whitacre nodded a hello to Tom Gibbons, the agent he had recently escorted on the nighttime tour of ADM. Gibbons, who was by the bed fiddling with some electronic equipment, returned the greeting. Whitacre knew he was about to receive his best recording equipment yet. Wilson would be at the meeting today with Philippe Rollier and Alain Crouy—two executives with Ajinomoto’s European affiliates. It would be the first chance to tape Wilson with competitors, and no one wanted to miss a word.

Shepard brought out shaving cream and a razor. “Mark, I’m going to need you to take off your shirt.’’

“Oh, yeah,’’ Whitacre said, removing his jacket.

Shepard had told him a few days before that this new reel-to-reel recorder, called a body Nagra, would be strapped onto his back under his shirt. Small wires with multidirectional microphones would run from the device to his chest. Recordings from a body Nagra would be far better than from the pocket microcassette and would minimize the problem of clothing brushing the microphone. Plus, unlike the briefcase or notebook, he could carry it anywhere.

Whitacre laid his shirt across the bed and Shepard smoothed dabs of shaving cream on his chest. He stared straight ahead as the agent ran the razor across his skin until it was smooth. Gibbons handed Shepard the microphones, which he secured to Whitacre’s chest with pieces of tape.

Using a white belt lined with Velcro, the agents strapped the body Nagra around Whitacre. The device, resting in the small of his back, felt huge; Shepard assured him it was difficult to detect, but warned him to be careful when sitting down. The device could make a clunking sound if it hit the back of a metal chair.

“Now, we’re going to need to cut a small hole inside your pants pocket,’’ Shepard said. “It will help you operate the device.’’

Whitacre hesitated. “Okay,’’ he said finally.

He took off his pants and handed them over. Gibbons quickly snipped open a front pocket. Then, he slid a tiny wire from the body Nagra into the pants and through the hole before handing the pants to Whitacre.

Once Whitacre zipped his pants, Gibbons instructed him on how to use the recorder. In his pants pocket, Gibbons said, was a tiny switch.

“So when there’s something to record, just put your hand in your pocket and turn it on,’’ he said.

Gibbons suggested trying out the device. He and Shepard walked behind Whitacre as he slid his hand into his pocket and flicked the switch.

“Ummm,’’ Shepard said, studying the recorder.

“On,’’ Gibbons confirmed. “On.’’

His hand still in his pocket, Whitacre turned off the device.

“Okay,’’ he said, “that seems easy.’’

As Whitacre dressed, Shepard brought out the FBI briefcase. They wanted Whitacre to use two recorders that day to insure that nothing was missed.

“Okay,’’ Shepard said. “We can meet back here tonight and I’ll pick up the tapes.’’

He shook Whitacre’s hand. “Good luck.’’

The Beech King Air B300 turboprop gently touched down on runway 18/36 at Merrill C. Meigs Field near downtown Chicago. The pilot taxied the ADM corporate plane to the hangar just before five o’clock. Seated in the spacious cabin’s rich leather chairs, seven company executives waited for the propellers to stop spinning before heading for the exit.

The first off was Richard Reising. The ADM general counsel had come to Chicago with other company lawyers for a dinner with investment bankers. Whitacre and Wilson had tagged along, agreeing to meet later for the flight home. Whitacre was the last to reach the tarmac. With the body Nagra strapped on, he didn’t want anyone behind him as he walked off the plane.

The executives headed out of the terminal in search of a taxi. With everyone else distracted, Whitacre leaned down, as if checking something in his briefcase. As instructed, he touched the latches.

Inside the case, things began to happen. Behind a false top, the Nagra recorder sparked to life, draining power from the commercial batteries that Gibbons had installed that same day. The magnetized tape moved through the recording heads.

Every sound within range was now being taped.

Whitacre stood. “Not easy to get a taxi down here, is it?’’ he said.

“Well, there’s one right there,’’ one of the ADM lawyers responded.

Wilson looked over to the cab and raised his arm. “There’s one, yeah.’’

“We’ve got plenty of time,’’ the lawyer said. “Why don’t you take that one?’’

“Yeah, thank you,’’ Wilson said.

Whitacre and Wilson walked to the taxi. Whitacre climbed in first and scooted across the backseat.

“Remember,’’ the lawyer said, “we take off before dark, or we don’t get out of here.’’

“We’ll be here about nine to nine-thirty,’’ Whitacre responded.

Reising leaned toward the taxi.

“Pat ’em down for wires,’’ he said to Wilson.

What was that?
Whitacre couldn’t see who was talking, but he had heard something about wires.

“Huh?’’ Wilson said.

“Pat ’em down for wires,’’ Reising repeated.

Wilson laughed as the cab pulled away.

Whitacre looked at Wilson. “What’d he say?’’

“Pat ’em down for wires,’’ Wilson said.

Is this serious?
Whitacre thought. If ADM insisted on pat-downs, the Europeans might reciprocate. It wouldn’t be hard for them to find the recorder strapped on his back.

“Probably should,’’ Whitacre laughed.

Wilson instructed the driver to take them to O’Hare International Airport, where they were scheduled to meet the two French executives. Whitacre slid his hand into his pocket, found the switch for his body Nagra, and flicked it on. He wanted a backup, to be sure that this conversation was recorded.

“So Reising must know who we’re meetin’ with, huh?’’ Whitacre asked.

“I didn’t tell him,’’ Wilson replied.

“I didn’t tell him,’’ Whitacre said.

Wilson laughed. “He just figures who we’re meetin’ with.’’

“He must have thought we were meeting with Ikeda. He said ‘pat ’em down for wires.’ ”

“Oh, I don’t know,’’ Wilson grumbled.

“I don’t think we’d have to worry about that with Rollier.”

For more than an hour, the cab crawled through stop-and-go traffic. Whitacre shut off his recorders to save tape. Finally, they pulled up to the O’Hare Hilton Hotel. After paying the fare, they headed through the lobby toward the Gaslight Club, the restaurant where they were scheduled to meet the French executives. Whitacre slid his hand into his pocket and turned the body Nagra back on.

The restaurant seemed a surreal holdover from the 1970s—part Playboy Club, part Edwardian steakhouse. The bordello-red decor was highlighted with generous amounts of velvet; the waitresses dressed in fishnet stockings, heels, and sequined black bodysuits. Older businessmen seated around the room chose their dinners from a circular steel platter holding cuts of raw meat. Among them, a smattering of FBI agents from the Chicago surveillance unit posed as diners.

Whitacre excused himself, heading to the bathroom. As expected, an FBI agent was waiting. Whitacre identified himself and told the agent that he and his group were seated in the smoking section.

Outside the bathroom, Whitacre ran into the French executives and took them to Wilson. After they sat at the table, a scantily clad waitress appeared.

“Good evening,’’ she said. “I’m Teri. I’ll be your Gaslight girl this evening. May I get you something to drink?’’

In a few minutes, the men were offering toasts and were ready to talk business.

“Well, how about you guys?’’ Whitacre asked. “Are you satisfied the way things are going for lysine?’’

“Not completely,’’ Crouy said. “I mean, we have restricted our quantities to try to keep prices, and uh, the prices were satisfactory.’’

“Especially in Europe,’’ Whitacre said.

True, Crouy agreed, but prices were now going down, so his division was stepping up sales to compensate for the lost revenue.

“Price is going down in Europe?’’ Wilson asked.

“In Europe, very much so,’’ Crouy said. “I mean, pushed by you.’’

Whitacre’s effort months before to derail the price-fixing scheme was catching up with him. He glossed over it, offering up a few explanations.

The men haggled over prices and volumes around the world. Rollier and Crouy blamed ADM for most every problem. Wilson, already on his second scotch, fought back by reminding them of an earlier meeting.

“We told everybody as plain as we could tell them that by the end of October 1993, we intend to be as big as Ajinomoto. We said it openly.’’

The fact that prices held for a while in Europe was meaningless, Wilson continued. “Alain, we cannot have one section of the world where it works and the rest of the world where it doesn’t. It will not last. It cannot last. It just doesn’t.’’

Getting close.
Without using the words, Wilson was openly talking about price-fixing. The liquor seemed to be loosening everyone’s tongues.

Teri the Gaslight girl returned, carrying a platter of meat. The executives indulged themselves, selecting racks of lamb, shrimp, and steak. When she left, they resumed their conversation.

Crouy said that he had left the Paris meeting in October with the impression that few competitors wanted an agreement to limit production. The men argued about the responsibility for falling prices.

“Well, one can point a lot of fingers,’’ Whitacre said, setting down his glass of Chardonnay. “I guess the thing is, what’s the solution?’’

Wilson agreed. At the first big Mexico meeting, getting an agreement on a target price was easy.

“We went out and we said, ‘Okay, our price is going to be at . . .  ,’ ” he said, holding up his hand to symbolize the selected price. “That’s what we agreed on. And we did it. And we did it across the board without hesitation.’’

Then, Wilson continued, excuses started piling up. The Japanese complained they were having trouble preventing their salesmen from competing for customers by offering lower prices.

A strategy could be adopted, suggested Wilson, in which each company reported sales numbers to the other producers. That way, competitors would know which company was pushing down prices by selling too much. That company would be allocated fewer sales for the following month. If the companies cooperated, everyone would receive a fair share and prices would hold.

“You have monthly reporting,’’ Wilson said.

“Which means that you have to see each other very often,’’ Rollier said.

“I don’t know if you have to see each other often,’’ Wilson countered. “I just think you gotta have the figures monthly, that’s all.’’

Whitacre knew that Wilson was describing the system used by ADM and its competitors to fix prices in the huge market for citric acid. Shepard had been pushing him to tape Wilson talking about citric. Whitacre figured this was his opening.

“That’s how it’s done in citric, isn’t it?’’ Whitacre asked.

“Yeah,’’ Wilson replied.

Confirmation.

Crouy didn’t like the idea of sharing numbers. “That doesn’t work with Asian people,’’ he said.

Rollier agreed. “We would obviously play that game. But, uh, the Koreans and the Japanese—”

“You will never get them,’’ Crouy interrupted.

“You will never get them from the Koreans,’’ Rollier continued. “They’ll cheat, or they’ll say yes and they’ll, uh . . ”

“Never do it,’’ Crouy said.

Wilson sat back. “It’ll never work, then.’’

The men sifted through their positions again. Wilson became frustrated. Occasionally, he broke the tension by flirting with the waitress.

If everyone shared sales numbers, Wilson repeated, they would know exactly who was producing too much. Throughout the year, each company would be allowed to adjust sales as each month’s numbers were distributed.

“If we’re ahead, then we’ve gotta cut back,’’ he said. “Oh, shit, it’s so goddamn simple. How the hell else will you do it?’’

Again, the French executives said that the Koreans would not cooperate. They would cheat. Whitacre suggested that sales numbers could be audited by an accounting firm hired by the lysine producers.

“We do that in citric,’’ Wilson added.

Rollier and Crouy encouraged Wilson and Whitacre to attend more meetings. Even without agreements to limit volume, the meetings helped.

Wilson’s face was hard. “Well, I don’t know.’’

Crouy leaned in. “Let’s not forget that if prices went up in Europe, it’s because we talked in Mexico first.’’

“That’s right,’’ Wilson agreed.

“Then because we talked in Europe a lot after.’’

“You made it happen,’’ Wilson said.

“I mean, it didn’t just go up like that.’’

“You made it happen,’’ Wilson repeated.

Whitacre tried not to breathe. Crouy and Wilson had just confessed: Lysine prices went up because competitors met in Mexico.
They made it happen.

The executives drank coffee after dinner. Past eight-thirty, Whitacre checked his watch. He and Wilson needed to leave, or they would miss their plane. Whitacre picked up the $267 dinner bill, and the men parted ways. Wilson and Whitacre hurried to a cab.

As the cab made its way to Meigs Field, Whitacre decided to make one more point for the tape. He mentioned that he had paid the bill for dinner.

“On my expense report, should I put dinner with Philippe Rollier and Alain Crouy of Eurolysine?’’

“Nah,’’ Wilson said. “Probably not.’’

“I did that one time and Randall kicked my ass.’’

“Yeah, yeah. Well, better not.’’

Whitacre relaxed in his seat. It was the perfect close for the evening.

•   •   •

Later, shortly before eleven-twenty, Whitacre was back at the Best Western, barely able to contain his excitement.

“Brian, you’re not going to believe it,’’ Whitacre breathed. “They talked about everything. They talked about Mexico. Terry told them all about citric, how they do it. And it’s just like I told you.’’

Shepard held up a hand. Whitacre was a little too excited. He needed to slow him down.

“That’s great, Mark,’’ he said. “Let’s take this one step at a time. Did you get everything on tape?’’