Nothing Personal: A Novel of Wall Street (22 page)

“No problem. Good-bye, Detective Wittlin.”

Wittlin nodded and tapped his forehead, then shook Warren’s hand, almost as an afterthought. He put his card on the table. He seemed preoccupied. “If you can’t get either of us, we check in every half hour. Leave a message.”

*   *   *

Warren went back to his desk a little dazed. Growing up in the Hamptons and Millbrook, where the local cops seemed to live to harass the summer people and to persecute their own ex-schoolmates, Warren had never been involved in anything more than a speeding ticket. He was glad his dad was in town for dinner that night. He always made Warren relax. Ken Hament used the same phrase his own father did whenever one of his boys would start whining about something: “That’s too bad aboutcha.” It made you realize that there were generally far worse things people had to endure than whatever was bothering Warren or Danny. Talking to the cops might not be fun, but it beat lying in a cold drawer at the city morgue.

twenty-two

As he climbed the stairs to exit the subway, Warren was thinking how jealous he was of people who worked in midtown Manhattan rather than the downtown Financial District. He made a left at the top, rather than the habitual right—he was having breakfast with Neal Faber, a friend from his first semester at Columbia, an attorney he’d met at a party he’d gone to with Chas Harper. They’d played tennis on occasion, and met every few months for breakfast, to compare notes—Neal was working at a major securities law firm, and moving up fast. He and Larisa had gone out with Neal and a long line of gorgeous, intelligent women he never seemed satisfied with.

Seven-Thirty Broad Street, Viner and Goulet’s offices, was not a particularly distinguished building, but the firm handled some of the most complicated securities deals, asset transactions, and even mergers and acquisitions work for the Street. At the security desk, the guard called Neal’s extension. He was given a name tag and sent up to the 6th floor. Neal was waiting at the elevator bank when he got off.

“Hey, buddy! Welcome behind the Wizard’s curtain!” Neal was incredibly thin, his head seemingly oversized for his body. The close-cropped, almost shaved hair gave him a skeletal look, but his generally happy personality softened the overall impression of intensity.

“Yeah, I might steal all your ideas!” Neal’s specialty in exotic structured bonds and in how to create financing vehicles for distressed assets—like mortgages in default, or even bankrupt companies, was considered the province of the most mathematically gifted rocket scientists on the Street, and they needed extremely sharp lawyers. “But, seriously, is it okay for me to be here?”

“Dude, don’t worry! Just don’t tell anyone, okay?” Neal slapped him on the back. “You gotta hang out for a bit—I have to finish something, and it’s taking a little longer than I thought it would, so I told them to send you up. Is that okay?”

“No problem.” They were walking past an open lounge, and Warren smelled coffee. “Can I grab a cup?” He pointed at the large silver urns lined up along a counter in the room.

“Hey, sure. You know what, why don’t you just grab a chair in there? I shouldn’t be more than ten minutes. You have a
Journal
?”

“I don’t leave home without it!” Warren pulled the folded paper out of his bag. “I don’t have to be in until nine thirty, so take your time.” Stacks of paper cups were next to the urns, and Warren filled a large one, splashed in some milk, and plopped down in a chair along the wall of the big room. He couldn’t help but notice how shabby and crummy the space was. Weldon’s lounge on the trading floor was softly lit, carpeted, and comfortable. The coffee was tended by staff from the executive dining room, always fresh and rich. The law firm’s version was thin and acrid. Conover had always said that coffee was the fuel that ran the floor, and it should be the best possible—to help keep everyone overworked and caffeinated.

The front page offered nothing of much interest, so Warren dug the
Post
out of his bag and flipped to the sports pages. After a few minutes, a small group of men came in, and he recognized Les Bergeron, one of the Street’s best-known traders, as well as Tim Saturnino, the founder of Bastille Investments, one of the most aggressive hedge funds around. Their specialty was buying up portfolios of distressed assets and mining gold out of them that no one else recognized. Saturnino was medium-height, with long, prematurely gray hair that fell across his forehead, and moved at almost laconic pace. The two other men were very different—one an extremely tall, rotund fellow with bristly black hair, a pug nose, and thick, black-rimmed glasses. The rapid, jumpy way he moved and talked somehow reminded Warren of a wild boar—or at least what he imagined a wild boar would look like, since he’d never seen one. He was whispering to an even taller man, easily six-six, who wore no glasses, but had what appeared to be a perpetual squint, his eyes thin slits above a large nose and thick lips set in his puffy face.

“Listen, Tim, this is in the bag—it’s no issue.” The feral-looking fellow gesticulated animatedly with both hands as he spoke. “They hired us to tell them what to do, and they’re gonna do
exactly
what we tell ’em!”

Tim shook his head and shrugged. “Well, if we can keep this out of competitive bidding, it’s gonna be a grand slam, I promise you!” He looked at Bergeron, who nodded and slapped Tim on the shoulder.

“That’s what we’re here for, right? We told ’em that you guys are the best in the business, you’re the
only
shop prepared to step up, and they better not blow this meeting or it’ll cost ’em at least twenty points! Oh, this is gonna be sweeeeeeet!” All four men chuckled.

“God, could you imagine if Rainwater or Cooperman or even Kravis had any idea this stuff was for sale, what would happen?” Bergeron had a nasal voice and an unctuous manner.

One of the men Warren didn’t recognize spoke up. “Listen, guys, Les is gonna have to get a massive disclaimer and indemnity in his engagement letter. Let Grolier draft it, then we’ll mark it up and ‘discuss’ it for a while. We’ll be sure everything gets brought down to the buyer. It’ll be clean as a whistle.”

Warren easily deciphered what they were saying. Some company had hired Bergeron’s firm to sell assets for them, and they were directing them to Bastille as the best buyer. Bastille was going to get a steal on the pricing—there would be no competition. The other three mentioned—Richard Rainwater, Leon Cooperman, and Henry Kravis—three of the biggest names in private equity—would all have loved to bid on the assets, but they weren’t going to get the chance. Warren was dumbfounded. This was completely immoral—and probably illegal. The firm was obliged to get their client the best price in the markets. Meanwhile, the lawyer would be sure the legal documents absolved both of them from any claims in the unlikely event the seller of the assets ever figured it all out. Oviously, Grolier, another major law firm, was in on it as well.

“You all set for the meeting?” The tall man had spilled a little coffee on his tie and was blotting it with a napkin. “You need anything else?”

Tim waved his hands, and a smug smile creased his eyes. “Noooo, I think we’re all set. We’ve got everything. Don’t worry.
We’ll even bring the sheep’s clothing!
” This prompted hearty laughs all around.

“We’ll tally it up when we do the secondary offering for you guys and adjust the net,” Faber said, and they didn’t even notice Warren as they strolled past him on their way out, coffee cups in hand. Warren waited until they were gone, then laid his paper down.

“Jeezus!” he couldn’t help blurting out loud. What he had just overheard was “epic” in Jed Leeds’s parlance. These men were conspiring to bilk a banking client out of what must be a huge amount of money, and then to split the profits by adjusting Bergeron’s firm’s fees on another deal—possibly through a sale of stock for the hedge fund later in the year. It would be impossible to connect, even if someone were looking for it. Saturnino’s joke was spot-on—these were wolves in sheep’s clothing. It also explained how his firm always seemed to buy assets so cheap—they were paying off sellers’ financial advisers to give them the inside track. No one would ever suspect it. As Warren sat there absorbing all this, Neal came around the corner with his jacket on.

“All set, dude! What do you say to Harry’s for an omlet? I’m starving! How’s Larisa?”

Warren got up and put his paper away. “Give me a sec.… Damn! You wouldn’t believe…” Warren hesitated. What good could telling Neal possibly do?

“What? How hot Larisa is for me?” They were already at the elevators. “I always knew it!” Neal’s gap-toothed smile reminded Warren a little of Chas Harper’s. The two could not be more different.

Warren waited and recounted the basics of the story to Neal over breakfast at Harry’s.

Neal just shrugged. “Dude, in the time I’ve been here, believe me, I’ve seen things that make that look like the minor leagues. Those other two must have been Paul Stevens and Jimmy Salinger. Stevens is unbelievable. He advises the group that invests money for Bergeron and the partners of his firm. There is
nothing
Bergeron wouldn’t do. I met his mother at my parents’ cocktail-party benefit for Central Park. You know what she said? It was like ‘My relationship with my son wasn’t good until I came to terms with the fact that he would, absolutely, sell
me
for a dollar!’ Can you believe that? His own
mom
! Then she told me about how he flies her and all their family around on his G-IV jet. She’s a piece of work. Two-fisted drinker, too.” Neal was devouring his omelet, two orders of bacon, a plate of hash browns, toast, juice, and anything else within reach.

“Man, I feel like taking a shower or something.” Warren was still uncomfortable. “I mean, what I heard—”

“Forget it. Don’t even think about it!”

“What do you mean?”

“Dude, don’t even
think
about telling anyone. Nobody gives a shit. And it’s probably dangerous.”

“Dangerous? What do you mean
dangerous
?”

Neal speared what was left of Warren’s breakfast steak. “I mean fucking
dangerous
. Listen, people get killed over twenty bucks in this town. Bergeron’s firm has a whole
department
devoted to this shit, and it’s in the
billions
!”

“
Department?
What are you talking about?”

“Dude, they’re called the Reputational Risk Department or something like that. No shit. It’s in another building, even. I had to go there last year to talk to them about a new bank client in South America. Everyone knew they were laundering money for the drug cartels, but they were connected through their government, and their trading desk wanted to do business with them. So little old me, the lawyer, goes down to Rep Risk, and there’s these
huge
guys down there. I talk to one of them, and he’s a former Mossad agent. Basically tells me they deal with anything or anybody who could put the firm’s reputation at risk in any way. And he smiled when he said ‘deals with’ too. Also says every firm has something like it. The stakes are too high.”

“Jesus. That’s some crazy shit!” Warren had stopped eating.

“Listen, there’s a reason these places make so much dough. I got a million stories.”

“A
million
? I know you like to tell a story, but a
million
? Come on!”

“Trust me. Listen to this one: Over at Bergeron’s firm a few months ago, they are selling a package of loans to a giant finance company from their trading position. I’m over there working on a prospectus, and I hear the trader talking to Bergeron, saying that there’s a loan in the package that’s going to blow up in a couple of weeks. He tells her to forget about it, and to have one of our lawyers call up the borrower and figure out a way to keep the loan afloat for a while. Otherwise, if they pull the loan, the whole sale could collapse. She says, “Les, are you kidding me? They’re gonna find out for sure. What the hell are you thinking about?”

”Jeez.” Warren interjected.

“So wait.” Neal’s eyes were ablaze. “Get this! Bergeron looks at her, then starts digging in his pocket.” Neal mimed rummaging in his pants. “He pulls out a fistful of twenties and shakes them in the trader’s face. And yells, ‘What am I thinking about?
THIS! This is what I’m thinking about!
This and how to put as much of this in my pocket as I can! And that’s what
you
had better be thinking about, too!
’ … I’m not kidding. A fistful of fucking twenties! In her face!” Neal was slightly flushed, his amazement tinged with clear anger.

“Damn! That’s … what? Naked?”

Neal went on, still fired up, “So she says, ‘What about the ethics notice? What about ‘the firm must always place the client’s interests ahead of its own’?” Warren and everyone on the Street knew about the various compliance documents sent around every year, led by Goldman’s Ten Guiding Principles. Neal kept going. “So Salinger just snorts and says, “Fucking A right. And whenever we actually do put a client first, stupid, make no mistake, it’s a fucking
business decision
!”

“Nice. I guess those guys aren’t…” Warren was shaking his head.

“What, any different than any of the other scumbags all over this festering swamp? Well …
wrong!
They’re a whole lot better than anyone else. They get the client to
thank them and pay them
while they’re
raping
them! Come on, you gotta admit, it’s goddamn
impressive
! Goldman
wishes
they had the swagger those guys do.” Neal was smiling again, but Warren could see the disgust in his eyes and heard the disappointment in his voice.

“Yeah, I guess you could say that.” Warren wasn’t really surprised by the stories, only how Neal was so willing to talk about them.

“Anyway, so tell me about what’s been going on with you.” Neal had already put his credit card in the folder for the check. “It’s on me. They pay us less and promise us we’ll all be partners someday. And they make sure it’s always some Associate whose name is on any opinion or closing document so they can duck responsibility. That way they can take home six or seven mil each year and make us suckers wait until they’re so rich they can buy a whole state and retire. Fuck, when the managing partner finally retires, he’ll be worth at least three hundred or four hundred mil! Then he can run the US government for the benefit of his friends and colleagues!”