Tokyo Underworld (20 page)

History does not record how the
Ojosan
exchange ended. However, on June 25, 1968, Zappetti formally divorced Yae in Tokyo Family Court – in the presence of his old friend Judge Kondo – and on July 16 he married Miyoko in Sapporo.

The divorce settlement was a hint of things to come. The court awarded Yae the Yokota operation, along with one of Zappetti’s smaller houses and 50 million yen in cash. The settlement made Yae a very wealthy woman. And she would become even wealthier in the years to come, as Japan’s booming economy and real estate market added more zeros to the value of her land holdings – many, many, many more zeros. Given the going rate for the Fujisawa property, of which his first ex-wife was the proud owner, Nick imagined that he was now in a class all by himself where divorced
gaijin
men in Japan were concerned. Both his former wives were rich and getting richer by the day.

At first, despite the high cost of his freedom, Zappetti had been overjoyed with his young prize, whom he bragged about to his round table of friends in Roppongi. He had set up housekeeping with her in a two-story wooden traditional Japanese-style house in Sapporo so that Miyoko could be near her mother, with Nick spending weekdays in Tokyo, and he was boundless in his munificence. He gave his bride 1,750,000 yen each month for daily expenses (enough cash to last an ordinary Japanese housewife two years) and lavished her with gifts – a new car, a mink coat, a sapphire ring. When she decided she wanted to wear nothing but white suits, in tribute to the all-female Takarazuka dancing revue of which she was a great fan, he bought her a complete new wardrobe: white pants, white shirts, white hats. When she said she wanted to open her own nightclub in Sapporo, he said, ‘Sure, no problem’, and went out to look for the best site. He took to calling her Cinderella, because that’s what she was:
Shindorera
. She had more going for her, he’d tell her, than any two dozen Sapporo girls combined.

But, trouble was inevitable. Miyoko was outgoing, adventurous, even ‘flirtatious,’ as more than one acquaintance described her. And Nick was the jealous type – extremely jealous. Moreover, the fact that the unwelcome specter of middle age was making its presence known and preventing him from performing in a manner he would have liked only made things worse.

When the reports started coming in from friends in Sapporo that she was seen in the company of other men, among them her fortune-teller, and a popular singer, and that she was whiling away some of her free time in the evening at ‘host clubs’, Nick went ballistic – although Miyoko denied doing anything wrong. To him, it was humiliating.

Host clubs were the latest phenomenon in Japan’s profligate nightlife. They were institutions in which suavely groomed young men with impeccable manners and smooth conversational skills catered to mainly rich, bored middle-aged wives with absentee
workaholic husbands. Male hosts served their customers drinks, danced with them, and, after closing hours, provided other services – if the tip was generous enough.

That was how his wife, possibly the most beautiful girl in Japan, had been whiling away her free time. A great deal of her free time, if what his friends said was true. He simply could not understand it. She was such a good-looking girl and still she paid men to cater to her. What was the appeal?

On impulse, he decided to go see for himself. With the name and address of one of Miyoko’s ‘boyfriends’ supplied by the manager of the Sapporo Royal, Nick made an unannounced visit to the man’s residence – a modest but typical box-sized Japanese apartment not all that different from the type of accommodation most nightclub hostesses lived in.

The young man who opened the door was tall and thin with a wavy pompadour – good-looking, Nick had to admit, but in a creepy, pouty, narcissistic sort of way. Nick introduced himself and without hesitation asked the youth, who was in the process of putting on a tuxedo for the evening’s work, point-blank, whether he had slept with Miyoko.

‘I don’t know,’ he replied matter-of-factly, not in the least ruffled. ‘Maybe.’

‘Maybe?’ Nick repeated. ‘I ask you if you sleep with my wife and maybe is all you have to say?’

The man shrugged.

‘I can’t keep track of everyone,’ he said, affixing his bow tie. ‘Women pay me. I flatter some. I make love to others. That’s that. It’s business. Not personal.’

Nick had to admit he admired the man’s candor. And he was not immediately sure how to proceed from there. How could Nick blame the poor guy just for doing his job?

In a way, he could even begin to understand his wife’s feelings. A woman needed companionship, and Nick wasn’t there much of the time. Even when he was … well.

On the other hand, what if word got around about what was ‘maybe’ going on? The whole circumstance left him furious.

Thus, he wound up and slugged the carefully coiffed young man, knocking him out cold.

Eventually Nick moved Miyoko to Tokyo, where he could keep an eye on her.

With his son Vince having left home, it would be the two of them and his daughter Patti, now in her early twenties, plus the maid and the butler. But Miyoko would be under virtual house arrest, unable to go anywhere without permission and without being transported there and back by Nick’s chauffeur, who also doubled as a watchdog. If she wanted a friend, then Patti would have to do.

It didn’t take Miyoko long to violate the terms of her parole and, predictably, she moved back to Sapporo. In 1972, she filed for a divorce, and demanded 30 million yen in alimony.

Zappetti’s initial decision to marry Miyoko had caused him more trouble than he had ever imagined, for in addition to all the emotional turmoil that ensued, it almost led to his financial ruin and, in the process, taught him some painful new lessons about business in Japan.

To begin with, after Nick had turned over to Yae the assets designated by the Family Court, the National Tax Office sent him a bill for the very large sum of 65 million yen – a tax on the transfer of property to Yae in the divorce settlement. When Nick protested that the transfer had not been a voluntary sale but rather one ordered by the court, the tax authorities replied that it made no difference under the law. Technically, as far as they were concerned, he had transferred property and received something in exchange for it – namely, his freedom – which in their estimation was taxable to the amount of 65 million yen – a sum they would be willing to reduce to 23 million yen if he paid it all immediately.

The 23 million yen was not an enormous sum of money, but Nick was painfully embarrassed to admit he didn’t have the cash. He had lost over 200 million yen on a mink farm venture that everyone he knew had advised him not to undertake. Determined to get some use out of the land and equipment he had gone to such lengths to acquire, he had decided to raise mink in his barn, build a fur factory that processed the fur skins into coats, and sell them in Japan, despite objections from those who believed that introducing a new brand in a country that was rapidly becoming status conscious, and without connections to department store managers who sold most of the fur coats in Japan to boot, was far too risky.

Boasting that he was going to break the ‘the stranglehold the Norwegian Jews had on the world market’, Zappetti then proceeded to lose over a million dollars in record time. Japanese buyers, who were indeed rapidly becoming increasingly status conscious, wanted little to do with an unknown label regardless of how high the quality of his garments was. (When Zappetti, desperate to make a sale, cut his prices to a third of the going rate, buyers took it all as evidence that the quality of his coats had deteriorated and paid even less attention.)

He had followed the mink farm fiasco with yet another calamity, importing frozen rabbit skins from France. In addition, he had made a number of sizable loans to people who could not afford to pay them back, and overextended himself in a couple of other investments. Suddenly he found himself leveraged all the way up to his newly receding hairline. His last big chunk of ready cash, 50 million yen, had gone straight into Yae’s account.

He went to his regular banker, the Setagaya Trust Bank of Tokyo, for help, but officials there told him that the bank was prohibited from loaning money to anyone for the purposes of paying government taxes. However, they said that if he could manage to borrow the money elsewhere to pay for his tax bill, then the bank would be able to lend him the money to pay back
that
loan, which is when Nick made the fateful decision to go to the moneylenders, Tokyo’s infamous, usurious, and entirely legal storefront loan sharks, who charged 30 percent per annum and more.

To get the 23 million yen in cash he so desperately needed, he was forced to borrow 34 million yen – the result of a standard three-month contract at 8 percent per month, the first installment of which the moneylender took off the top, along with a 5 percent
orei
, or ‘thank-you’ fee. As collateral, Nick was required to put up the title deeds to the building that housed his main restaurant and the property on which it stood. The requisite cash now in hand, he paid his tax bill and then returned to the Setagaya Trust Bank to get his loan, only to be rebuffed a second time. Officials now informed him that bank policy specifically prohibited granting anyone a loan to pay off a moneylender.

Then he received a letter from the First National City Bank notifying him that a loan he had guaranteed some months earlier for a business acquaintance – a Chinese-American cookware executive in Tokyo named Chester Yep – was overdue. If he did not reimburse First National its 10 million yen immediately, the bank would seize Nick’s property. What this meant was that now he had to go back to the moneylender and ask for yet another emergency loan.
This
time he was charged an interest rate of 5 percent compounded
every ten days
. In all, it would cost him 18 million yen to get the 10 million needed to pay First National, and it would require him to mortgage even more of his assets.

Nick paid off First National, but now he owed a total of 53 million to the moneylenders and the interest was snowballing. Over the next six months, he paid monthly installments reaching a total of 48 million yen, but because of the crippling accumulation of interest, his total debt to the moneylender ballooned to 133 million (over $400,000). Paying the moneylenders every month was sucking up all his incoming capital, and consequently he had been unable to pay other bills, which were now piling up. He had
been neglecting his suppliers. He found himself in a very serious bind.

If he had been smart, he acknowledged later, instead of merely stupid and greedy, he would have sold some of his property in the beginning to pay the original tax bill. He had more than enough to spare. In addition to the
170-tsubo
(6,181-square-foot) plot of land on which his flagship restaurant stood, and his 275
-tsubo
(10,000-square-foot) main residence, there was the Atsugi factory, the fleet of four-ton trucks, the various other houses in and around the city, the cars, the yacht, the Hokkaido factory, the Hawaiian estate, and the smaller branch restaurants in the suburbs. There was also his newly opened pizza house near Roppongi Crossing, which encompassed the entire third floor of the six-story Hama Building next door to the elegant Seryna and which was doing a thundering business.

It was at this particular juncture that a representative of Nihon Kotsu (Japan Transport) had approached with an offer of ‘help’. Nihon Kotsu (Japan Transport) was the largest taxi company in the city, with a fleet of 2,000 cabs. The representative had heard of Nick’s difficulties through a Japanese business consultant Nick had hired and proposed a joint venture between Nihon Kotsu and Nicola Enterprises to create a nationwide chain of restaurants under the Nicola logo. In return for a 70 percent interest in the venture, Nihon Kotsu would immediately pay off all the outstanding debt Nick owed to the moneylender, which by then, the summer of 1971, had swollen to 160 million yen. Nick would subsequently be allowed to reimburse Nihon Kotsu at the very reasonable rate of 8 percent annually.

Nick did not care for the 70–30 percent arrangement, but he needed money instantly. He replied that he would agree to go along with the deal if Nihon Kotsu would throw in another loan of 63 million yen, on top of everything else.

Done, said the NK executive.

(And the devil take thy soul, he might well have added.)

A joint venture was quickly set up and Nick was asked to sign an agreement promising to pay the 160 million yen by March 31, 1972, and the 63 million by December 31, 1972, with the land and building belonging to his main restaurant serving as security. The agreement was ‘just a formality’, an NK executive assured him. If for some reason he was unable to pay at deadline time, the date could be extended. ‘Don’t worry,’ one of the men said. ‘We’re partners. We’re in for the long run.’

Indeed, the words ‘just a formality’ should have triggered internal alarm sirens. Especially in Japan, where the spirit of a contract was more important than the letter of it and multimillion-dollar deals were often concluded with just a handshake (or bow). At a fateful meeting attended on one side of the table by Nick and his ex-wife Yae, who was still an officer in Nicola Enterprises because of her holdings, and on the other, a dozen gray-suited Nihon Kotsu executives, accountants, and lawyers, Yae urged him not to sign. Although devastated by the divorce, she still cared enough about her ex-husband’s future to give him good advice. But Nick had ignored her and proceeded to put his signature on a document he could not read.

What did a woman know of such matters, anyway?

Nihon Kotsu quickly opened up a string of small Nicola’s around the metropolis, then, ninety days into the joint venture, management had a sudden change of heart. A store manager in the seaside resort of Ito, southwest of Tokyo, had taken the liberty of adding squid and fish to his pizza, which, in turn, had spoiled, and done damage to the gastrointestinal system of one customer. Nihon Kotsu management shortly thereafter advised Zappetti that the company did not wish to pursue the joint venture any further and gave him notice to be ready to pay off his debts totaling 223 million yen, 160 million of which was due in less than six months. There would be no further discussion.