Coffee (6 page)

“Is
this Harriet V. E. Bishop?”

“Yes,
who is this?” The Finance Department allowed her a small
cubicle where she could work with a little more privacy than the
undergraduate and graduate students - one of the few perks of the
PhD program. A computer with a network connection, and a phone were
hers for the year.

“My
name is George Leeson, Ma’am, from the Securities and Exchange
Commission of the United States.” He spoke with a southern
accent, Texan Etty thought. “I’d like to talk to you
about some Options trades executed by Dartmouth’s Treasury
this week.”

Etty’s
heart pounded harder. “What about them?”

“First
I’d like to verify a few things with you, exactly your
involvement.”

‘Get
a grip,’ she thought.

“Is
it true, Miss Bishop, that you served as an advisor in the purchase
of nearly twenty million dollars worth of Coffee options two days
ago, on Tuesday the 3rd of December?”

“Yes
I did.”

“Did
you base that strategy on a suspicion that the market in Coffee
might have been illegally manipulated, leading to an opportunity to
gain financially?”

“Wait
a minute, here. Are you accusing me of wrongdoing? I’m not
sure I should answer ....”

“Calm
down. I’m just trying to understand the details. Did you
write a short paper, signed by you and time stamped Tuesday morning
at 9:43am with full details, including a line, and I quote, ‘I
take full responsibility for the recommendation to Warren Sherman of
these Coffee option trades?’”

“How
did you get that? What is this?”

“Please,
Miss Bishop, answer the questions.”

“No,
I will not! I want you to explain to me exactly what I am being
accused of doing, and then, if this is a serious matter, I request
time to get legal advice.” Etty’s anger was fueled by
apprehension. She stood up to look over the partition of her
cubicle to see who else might be hearing this, and fortunately found
she was alone.

“You
don’t need to be upset, Miss Bishop. I’m not accusing
you. Did you write the paper, or didn’t you?”

“I
did, but I refuse to answer any further questions.”

The
man paused. “Let me explain. I represent the S.E.C., the
regulatory body over all security related transactions in the
country. I run the department that investigates fraudulent
transactions, and I get involved in only the biggest ones. You’ve
stumbled into a big one all right. Tell me honestly, you mean to
tell me you had no thought that your trades were illegal?”

“No,
I mean, I don’t know.” What a stupid response, she
thought.

“Well
then, let me be the first to tell you. They were. But you’re
not the one in real trouble - that would be your friend Warren
Sherman. He’s a registered broker, the one who executed the
trades.”

“How
did you find my paper?”

“We
saw the trades, called the Dartmouth Treasurers office, and they led
us to your advisor. They faxed it to us. Not too difficult. But
Miss Bishop, this has the potential of leading to some serious
indictments and I need to ask you a few questions.”

“What
did Warren say?”

“We
haven’t called him yet. We understand by your paper that you
dreamed this up, so we’re starting with you.”

She
rolled pieces of a newspaper into little balls as she talked. “I
don’t see the severity here, Mr. Leeson. We have done nothing
except invest, based on an educated guess, that prices would rise.
The same thing millions of people do every day.”

“I
told you, there will be no formal charges against you. But you
don’t see the severity? If you discovered a few million
dollars stashed under a rock in a public park, and you found out a
bank robber hid it there, do you think you could just take it? It’s
a public park, after all, right? People pick up rocks all the time.”

“No.
I guess not,” she said, feeling blood rush to her face.

“I
guess not.” He sighed. “Now. What you didn’t
know is that we’d been monitoring the same company for some
time, and we just recently figured out the options component. We
were all ready to take them down - had them in our sights last
Tuesday - but at the last minute, you and your friend Sherman jumped
in front of them. You scared them away, and took almost every penny
of our proof.”

“Global
Growers didn’t buy any options?”

“Not
enough to make a case. They weren’t able to cover their
losses from buying coffee at an artificially high rate from Clorice
Coffee. They took it in the teeth, and lost millions.”

She
shook her head, half smiling. “No kidding.”

“No,
I’m not kidding. It’s unlikely they’ll try that
particular scheme again. So you managed to foil our offensive,
setting us back months, maybe years.”

“Oh.
I see.”

“Do
you?”

“I’m
sorry, really, but I don’t think Warren Sherman should be
reprimanded when I’m the one who set it up.”

“Don’t
be naive. That’s what registration is for.”

Etty
felt as if a rail had been thrust through her chest. Had she
inadvertently ruined Warren’s career? All for a dissertation
topic? “Isn’t there another way beside prosecution? We
had no idea...”

“That’s
why I called. We have an opportunity I wish to discuss. A plea
bargain, if you will.”

“I’m
just not sure whether I should get a lawyer or, I don’t know,
call Warren.” She felt foolish for thinking aloud.

“All
we’re asking is that you help us.”

“Help
you, how?”

“Work
with us on this project to track down Global Growers. Although they
may not try Coffee again, we suspect they’re working other
markets - foreign currencies, fertilizer, grain.”

“What
would I do?”

“Give
us some advice. How long did it take you to find the coffee
abnormalities and make the options connection?”

“A
few days.”

“I
rest my case. You had it laid out perfectly in your paper. I’m
not going to admit how long it took a team of our people to find the
same thing. Come down to our Dallas offices tonight and we will
explain. If you cooperate Miss Bishop, we will drop all charges,
against you and Sherman.”

“Say
that again?”

“We
will drop all charges against you and Sherman if you spend some time
helping us find a way to nail this company.”

“I
must say, I’m surprised.”

“I’d
like to tell you this is an unusual case, but we often bend the law
if it leads us to the source. And I know you’re no criminal.”

“But
Tonight?”

“Let’s
not trivialize the hazard you’re in. We prosecute Warren, and
your world will come tumbling down. He’ll be stripped to a
penniless inmate. Dartmouth College’s reputation will be
forever tainted. And you. Although you’d walk away without
criminal charges, you’d most likely be expelled and lose your
PhD. The Press would eat you alive. You reject our offer tonight,
you’ll be throwing away the only chance of redemption.”

She
rubbed her eye sockets, reeling. “What exactly would I do?”

“Just
help us research some other ideas we have, and see if you can come
up with anything on your own. We have access to more data than
you’ll ever get. Maybe you’ll see a clue, a way to
proceed.”

“I
need to think this over, call Warren and Knut. Hey, why not have
them come too? As a team, we’d be much more effective.”

“I’m
afraid that’s not an option. If you decide to help us, no one
can ever know. We’ll have you sign documents that protect us
from you divulging anything. We have ways to make the consequences
of breathing even a word very convincing. No, Miss Bishop, you’ll
be part of a top secret exploratory team. This is between you and
me, and it has to stay that way.”

“How
do I know you are for real?”

“For
real? .... I suppose that’s not an unreasonable question. The
easiest way will be to inspect my identification once you arrive at
the Dallas Fort Worth airport tonight. It’s a public place.
You’ll be free to turn around if you’re not satisfied.”

Etty
wished she’d had more time. It had occurred to her that the
trades might be questionable. She had figured privately that
Warren’s involvement would somehow legitimize it. He, after
all, came with the years of practical experience. Now she chided
herself for not bringing legality up with him openly - she admitted
to herself that she didn’t want to mention it. Stalling, she
asked, “Tell me again, exactly what you want me to do
tonight.”

“Come
down here. We pay all expenses, and through the weekend we’ll
run all the analyses you want. We have information on every
commodity that Global trades in. Maybe you’ll see something.
We have state of the art equipment, and rooms full of support
people. You’ll probably enjoy it.”

“Just
the weekend?”

“You’d
be back early next week, and then on call over the life of the
project.”

“And
if I don’t find anything?”

“That’s
our risk. You commit to us, we drop charges.”

What
a paper she could write, she thought. “Would I be able to
continue my dissertation ...”

“You
ask a lot for someone balancing on the edge. No, all mention of
this in any written material would have to be destroyed. I’m
sorry, you’ll have to start over. Anyway, did you really
think you could connect Dartmouth’s investment gains to a
market manipulation scheme in a published paper?”

“I
suppose you’re right.” An unsettling mix of pride and
foolishness left her quiet. Finally she asked, “Where do I
go?”

“Simple.
Here’s the plan.”

Etty
fumbled around on her messy desk top for a pen. She pushed aside
her collection of newspaper balls, and ripped a clean sheet out of a
notebook. “Go ahead.”

“Excuse
the false premises, but to make this easier for all of us to keep it
under wraps, we’ve created an alibi. Tell people you are
interviewing at an investment advisory company in Las Colinas,
Texas, outside of Dallas, called World Investment Corporation. We
will send a fax to your office at the College confirming the
interview time at 8:00am tomorrow morning, Saturday, along with a
complete itinerary. Take American Airlines flight 263 out of
Concord tonight leaving at 10:30pm. The tickets will be at the
counter in your name. Change planes in Boston to flight 1123 for
the red-eye to Dallas leaving at midnight. I’ll be waiting at
the gate.”

“Sounds
like you were expecting me to say yes. Do I really have to come
tonight? It’s snowing up here you know.”

His
voice became harsher. “I hope you see what’s happening
here. If this is your idea of cooperation, I’m beginning to
question my offer.”

“I’m
sorry. I’ll cooperate.”

“Good.”

Etty
knew she had no choice. The pile of books and unfinished
assignments in front of her on the desk reminded her how arrogantly
they had overrun her life. They demanded action entirely on their
terms with threats of devastating retribution. She wasn’t
just going to roll over, no matter who they were. “Mr.
Leeson, you have to understand this is all quite incredible. I
promise my support, and appreciate your offer for immunity, but I
need a few protections.”

“It
depends. Like what?”

“Umm,
first of all, I will request an airport security escort off the
plane. You must be at the gate with proper ID and hand me a letter
signed by a high level SEC executive guaranteeing immunity for
Warren and me. If you are not there, or you have no letter, I’ll
have security take me back to a plane.”

“I
already said that. And by the way,
I
am the high level SEC
executive guaranteeing your immunity.”

“Good
then. I am just clarifying.” A US Government agency? Who’s
to say they could be trusted. She wished she’d recorded the
call on tape. “Second, I am documenting this call in writing
as part of my personal notes, with all the details. Third, as soon
as we hang up, I’m calling the SEC offices in Washington to
verify your position.” She gritted her teeth waiting for his
answer.

“Remember,
you’re not getting my guarantee until you sign our agreement
on commitment and confidentially. Any notes you write better be
kept in a safe place if you want to comply. As for calling my
office, go ahead. I’m not there tonight, but you can get
through to a receptionist. You’ll find a public number through
202 information. Have the operator find me and my title in the
directory. Keep in mind though, you won’t get through to
anyone who knows about this deal, and it wouldn’t be wise to
start asking questions to administrative assistants. All
investigations are under tight security.”

“You’ll
have a letter when I arrive?”

“You
are a persistent young lady. Yes.”

“Well
then, assuming all goes well, I’ll be there tonight.”

“I’m
happy to hear that, Harriet. I’m looking forward to meeting
you. And when this is all over, you might even consider a permanent
position at the agency. We need people like you. Hey, I gotta
jump. Have a pleasant trip!” He hung up.

Etty
continued holding the phone, trying to fathom it all. A pleasant
trip? A strange ending to a strange call. The SEC. Jail. Ruined
careers. She made the call to the SEC and verified at least there
was a George Leeson in investigations. The operator didn’t
know if he had a Texan accent, but Etty felt reassured.

The
drive to Concord would take an hour and a half, so she had to leave
by 8:30pm. That gave her barely enough time to close up some things
at the office, make a few calls, drive home and pack, and get going.
Looking out the small window, she saw new snow starting to
accumulate on the paths in the courtyard.