Toronto. Monday, April 29.
Kerri, with willing and capable support from Steve, and a weekend reading marathon, had completed her study of Sandra Schafer’s lengthy information package. It consisted of more than seven hundred type-written pages, containing rheims of well documented data, complete with dates, supporting invoices, receipts and explanatory notes. She had not only concluded that the content was actionable, it contained enough evidence to constitute a slam dunk, one way ticket to lengthy prison terms for Ken Layton, Jeffrey Wheeler, Andrew Speers, and likely a number of other Enerco executives. With the fraudulent complicity of Benjamin, Alexander & Gabriel LLP, a large and respected accounting firm, the company had been duping the investment community into believing Enerco was far more successful than it actually was. Primarily with the use of special purpose entities, a myriad of complex offshore companies and limited partnerships, the company had been hiding gigantic trading losses, and over-stating revenues and income. In addition, the company had been fraudulently reporting profits without actually realizing them.
The timing of Enerco’s corporate shenanigans had been exquisite. It was the golden age of corporate thievery, a time when executive compensation headed for the stratosphere, huge bonuses were based on short term performance, and long term planning was limited to the next quarterly report. Breaking the rules was considered smart, or at least cool. Corporate executives thought they could continue to do so forever, and with impunity. Each of Enerco’s thieves had a role. Ken Layton was the boss, the man who sanctioned everything, schmoozed influential politicians with lavish parties and obscene campaign donations, lobbied and encouraged them to change the rules in Enerco’s favor. When he failed to get his required rule changes, he broke them. Jeffrey Wheeler, a financial genius, was the idea man. Incredibly, over his decade long association with Enerco, he had conjured up a mind-numbing blizzard of schemes, plans and vehicles, all of which were designed to bend or break accounting rules, to avoid or evade income tax, and to improve the market value of Enerco’s stock. Andrew Speers was the facilitator. Possessed with a brilliant and creative mind and a successful, near vertical career path, he made Wheeler’s ideas happen.
Kerri decided it was time to act. She could have taken Schafer’s information directly to The Internal Revenue Service, the Federal Bureau of Investigation, and the Securities and Exchange Commission, but instead elected to talk to Jeffrey Wheeler first. She wanted to give him and his two colleagues a chance to make a voluntary confession, to disgrace themselves publicly. She also wanted, needed to watch Wheeler squirm, just as he had done to her. She privately admonished herself for that need, but refused to suppress it.
With dogged determination in her mind, fear and trepidation in her heart, she turned on her Blackberry and dialed Wheeler’s office number. His secretary answered and Kerri asked to speak to Mister Wheeler.
“May I ask who’s calling?”
A perceptible delay was followed by, “He’s in a meeting, Miss King. If you can give me...”
“Tell him it’s urgent,” Kerri interrupted. “I think he’ll speak to me.”
“...Please hold for a moment.”
Kerri waited for thirty seconds, then heard a click, followed by Wheeler’s voice. “Nice of you to call, Miss King. What can I do for you?”
“I’d like a meeting with you, at your earliest convenience. We can do it in Houston, but I would prefer Toronto. You probably know I’m living there now. I don’t think you would want me to discuss the reasons for the meeting on the telephone, but I will if you insist.”
Wheeler chuckled. “Go ahead and tell me why I should interrupt my busy schedule and fly all the way to Toronto, just to see you. You’re old news, Miss King. I really don’t think we have anything to say to each other, unless you’re calling to tell me you’ve decided to take the job I was kind enough to offer you.”
Listening again to Wheeler’s arrogance succeeded in raising the level of Kerri’s ire and determination. “You can find someone else to fill that position. I respectfully decline your offer... Now, about the meeting. My place or yours?”
“You still haven’t told me what you want to talk about. Do it fast. You’re wasting my time.”
“I want to talk about a ton of accounting irregularities at Enerco.”
“I haven’t the slightest idea what you’re talking about,” Wheeler said, his heart rate accelerating, his haughty confidence punctured like a balloon.
“We both know you do, Jeffrey. I can be a lot more specific, but I don’t think you want me to do that on the phone.”
“I think you’re full of shit.”
“Fine, then we’ll say ‘goodbye’ and I’ll take my information straight to the F.B.I, the I.R.S., and the S.E.C.”
“Wait. Where did you get your information?”
“That’s none of your business. Who knows? Maybe I got it from Wilhelm Lentz.”
“I can be in Toronto by tomorrow morning,” Wheeler said, his arrogance gone. “Where and when will I meet you?”
“In the lobby of The King Edward Hotel. Noon. I’ll buy your lunch.” Kerri took delight in offering lunch because that was exactly what Wheeler had done when he met and blackmailed her at The Plaza in New York the previous December.
Wheeler slammed his receiver into its cradle, then hurried to Ken Layton’s office. He entered without knocking and found his boss, feet on his desk, reading glasses hung on the end of his nose, scanning a hand full of correspondence. “We’ve got big trouble,” he declared, causing Layton to frown at his visitor. He hated surprises. Worse, he hated bad news. “What kind of trouble?” he asked in his deep baritone voice, clearly annoyed by the intrusion.
“I just got a call from your friend and mine, Kerri King. She wants me to meet her in Toronto tomorrow, to discuss what she called a ton of accounting irregularities at Enerco.”
Wheeler’s news succeeded in attracting Layton’s attention. He removed his legs from his desk and sat upright. “What do you think she’s got? Did you ask her?”
“I don’t know, and no to your second question. I tried to blow her off, but she threatened to take whatever she’s got to the I.R.S., the F.B.I., and the S.E.C.”
“Then you’ve got to go to Toronto and find out what she has. If it’s serious, we’ll have to deal with it. Make her an offer, whatever it takes to keep her quiet.”
Wheeler shook his head. “I’ll try, but I’m sure it won’t work. That broad isn’t for sale.”
“I was afraid you’d say that. Where and when are you meeting her?”
“Lunch at The King Edward Hotel.”
“Call me as soon as it’s over. Meanwhile, I’ll call Lorenzo Mengalli and tell him we might have a job for him. Put your game face on, Jeffrey. This could get messy.”