Ellery Queen’s Double Dozen

James M. Ullman The Happy Days Club

In the December 1962 issue of Ellery Queen’s Mystery Magazine we presented a new kind of crimebuster — a stock-market detective, a specialist in industrial skulduggery. Here is the second in this unusual series — the second adventure of Michael Dane James and his “Archie Goodwin,” Ted Bennett, who are not only stock-market sleuths but also industrial espionage agents. In their second case they investigate a “leak” in one of the big mutual funds... You say that you too are a shareholder in a mutual fund or a member of an investment club? Then you will be especially interested...

“Ted, I’ve got one right up your alley,” Michael Dane James announced over the telephone.

Ted Bennett, sprawled in a chair beside a customer’s man in a broker’s boardroom, replied without taking his eyes from the tape moving overhead. “Mickey, if it’s another scheme to drift me into a Detroit tool and die plant in the guise of a laborer, climb a tree. I don’t care what the 1965 Whozit is going to look like.”

“It’s a defensive assignment,” James said, “and won’t compromise your principles one bit. One of the nation’s biggest mutual funds, with assets of half a billion dollars, thinks its secrets are being stolen by a little investment club in Iowa.”

“You’re kidding,” Bennett chuckled.

“I’m leveling,” James went on. “So meet me in front of Sam’s at five o’clock. Our Wall Street friends want to talk to us there before they commute home to suburbia. They don’t think it would look good for us industrial spies to be seen in their offices.”

A sign in the window proclaimed SAM’S — HOME OF THE 25-CENT MARTINI. The price prevailed only during the cocktail hour, but as a result the place was jammed, mostly with executives from the financial district. James, a stocky man with horn-rimmed glasses riding his pug nose, and Bennett, tall, lean, and hatless, pushed through the crowd to a rear booth tagged RESERVED FOR MR. ALLEN.

Victor Allen, president of the Gibraltar Fund’s management group, rose to shake hands. He was big and burly and in 1934 had played tackle for the Green Bay Packers. He introduced James and Bennett to the other occupant of the booth — Stuart Clark, chairman of the fund’s stock selection committee.

“Mickey and I,” Allen told Clark as they sat down, “banged heads one year in the old N.F.L. We both got out alive somehow. Mickey’s an industrial espionage consultant now, and Bennett works for him. Sam, a couple more here.”

“Is this,” Bennett inquired, settling in a corner, “where you boys decide which stocks the Gibraltar Fund will buy? Booze up and then shove a pin through the Big Board listings in the Times?”

“Hardly,” Clark smiled. “Let’s just say that here we review in more relaxed surroundings decisions made elsewhere.”

“Show him the clip, Stu,” Allen said.

Clark drew an envelope from his pocket and removed a newspaper clipping. He pushed it across the table. A waiter brought two drinks and set them down.

“This clipping,” Clark explained, “was forwarded to us by the branch manager of a brokerage house in Des Moines, Iowa. It’s a story from a small daily newspaper, the Canfield, Iowa, Gazette. The story is the usual feature that papers print now and then about a local investment club.”

“ ‘The Happy Days Club,’ ” James read aloud, “ ‘is composed of fifteen residents of the Westlake subdivision. Its members are drawn from all walks of life.’ ”

“They seem,” Bennett observed, peering over James’s shoulder, “to have done rather well.”

“There’s something remarkable about The Happy Days Club,” Clark went on. “That’s why my friend in Des Moines sent me the clipping. He sells a lot of shares in our fund, you see, and knows our portfolio. And he noticed in the past eight months that The Happy Days Club has been buying or selling only those stocks which we bought and sold.”

“It could be coincidence.”

“It could be,” Allen broke in, “but even more remarkable is the fact that their buying and selling took place before we announced we had bought or sold the stocks, and in some cases, after we had reached a decision but before we had even completed a transaction. That story gives the dates of their sales and purchases and we checked them against our records. The club didn’t buy every stock we bought, of course — they don’t have that much money. But there’s not a single stock in their list that we didn’t buy. And not a single stock we sold that, if they owned it, they didn’t sell.”

“Secrecy,” Clark added, “is essential at a certain stage in our business, Mr. James. We’re required to report quarterly on our purchases and sales. But we’re allowed enough leeway so that we don’t have to report on the transactions we’re making at that time. Our minimum investment in any stock is about two million dollars. Naturally, we don’t go into the market and buy two million dollars’ worth of stock in one day — the purchase, or sale, is spread out over a period of weeks or months. The brokers we buy through are carefully screened for their ability to keep their mouths shut about what we’re doing. Because if word got out that we were putting two million dollars or more into a company a lot of speculators would buy the stock, too, hoping for a killing.”

“Secrecy isn’t as much of a consideration,” Allen explained, “when we buy widely held blue chips like AT&T or Jersey Standard. But it’s a prime consideration when we buy into a lesser-known company which we think may become a blue chip in the future. And it’s that class of stock, incidentally, which The Happy Days Club has been buying into with us.”

“So you believe,” Bennett said, “that The Happy Days Club has a pipeline into the innermost circles of the Gibraltar Fund.”

“Exactly,” Clark said. “We’re not so concerned that these fifteen Iowans are stealing our judgment, so to speak, as we are with the fact there is a leak in our organization. If word of our decisions reaches many people before we announce them, the price of every smaller company we start buying into will be bid up to the moon. What’s more, we’re one of the big funds in the country. If the story ever got out that a little investment club was able to steal information from us, we’d be held up to ridicule. Someone might even investigate us. You know how things are these days.”

James fingered the clipping. “Any of these names — the fifteen club members — strike a responsive chord?”

“None whatsoever.”

“Well,” James concluded, “I’d say the way to begin would be for Bennett, here, to go right to the source and find out how The Happy Days Club arrives at their decisions. Meanwhile, I’ll have Barney, my sound man, see if your phones are being tapped or anything. And I’ll run a check on the backgrounds of everyone involved in your stock transactions.”

“We don’t want to alarm those people in Iowa,” Allen said.

“Don’t worry,” Bennett said. “Bennett will appear in appropriate disguise.”

A day later Bennett flew to Chicago, took another plane to Davenport, and then rented a car. He drove south along the Mississippi, reaching Canfield, a river town of some 20,000 population, as dusk fell. He checked in at a motel, wolfed a paper plate of fried chicken at a drive-in, and returned to his room for a good night’s sleep.

In the morning he drove to downtown Canfield. He breakfasted on tomato juice and toast, stopped at a news agency for a Wall Street Journal, and then, Journal and an attaché case in hand, entered the offices of the Canfield Savings and Loan Association. The newspaper clipping had identified the president of The Happy Days Club as Robert Gordon, a loan officer at the institution.

Gordon, a genial, portly man in his fifties, greeted Bennett with a puzzled smile.

“You say you’re from New York? Are you buying real estate in our town, Mr. Bennett?”

“No,” Bennett said, shaking Gordon’s hand and taking a chair, “I’m a writer. Free-lance. I’m working up a magazine piece on investment clubs.”

“You’ve come a long way for that.”

“I know,” Bennett explained, “but that’s the point. I want to get away from the usual slick big-city and fancy suburban crowd — advertising men and sales executives and all that. I want a good part of my article to deal with the way an investment club works in small-town America, the folks right across the street.” He pulled a photostat of the clipping from his pocket. “I’ve had a clipping service send me everything they could find on small-town investment clubs. And as soon as I read about The Happy Days Club in the Gazette, I knew it was the club I wanted to feature in my article.”

“I’m flattered,” Gordon said. “I’m sure the whole club will be flattered. In what magazine will your story appear?”

“I have a tentative commission from the editors of View,” Bennett said, handing Gordon a faked letter written on View stationery. “But if they decide they don’t want it, I don’t expect to have much trouble selling it elsewhere.”

“Will there be pictures?”

“Of course. I have my camera at my motel.”

“Well, won’t that be nice,” Gordon said, beaming and returning the faked letter. “Tell you what. Meet me for lunch at the American Cafe around the corner. Meanwhile, I’ll phone the members and try to set up a special meeting as soon as possible.”

Bennett walked to the Canfield Gazette building. He told the managing editor the same story he had told Gordon and got permission to use the newspaper’s library for background material on the club and its members.

He spent two hours going over the Gazette’s clipping files. When at last he left the building, a police car slowly followed him around the corner and down the block to the American Café. Bennett tried without much success to pretend it wasn’t there.

“All our members have been contacted,” Gordon announced over coffee. “Most of them can make it at my house tomorrow night. They’ll be there at eight. But I wish you’d drop in tonight and have dinner with my family.”

“Delighted,” Bennett said. “By the way, who makes the buying and selling decisions for your club?”

“We have a three-man selection committee — Cromie, Hubbard, and Price. When anyone has a suggestion for a stock to buy or a reason to sell a stock we hold, it’s forwarded to the committee. When we were first organized, the whole membership used to vote on what purchases or sales to make. But recently we’ve let the committee make the actual decisions, since they say timing may be important.”

“Who’s chairman of the committee?”

“We have no chairman. Just the three men. But the selections they’ve been making lately have been doing so well that we haven’t changed members of the committee in nearly a year. Before that we had an awful lot of losers.”

Bennett had almost reached his car when the police car pulled up behind him and stopped. A tall, husky man in uniform emerged.

“Sir,” the officer said cordially, “would you mind coming with us?”

“What’s the trouble?”

“No trouble. The Chief wants a word with you.”

Bennett shrugged and climbed into the back of the police car. He flipped through his Wall Street Journal as they rode to the station in silence.

The Chief of Police, a huge, crew-cutted man of about Bennett’s age, late thirties, smiled and nodded toward a chair.

“Sit down, Mr. Bennett. I understand you’re a writer.”

“That’s correct,” Bennett said. He put his attaché case and the Journal on a radiator under the window and sat down. Inwardly, he debated whether to volunteer to show the Chief the faked View letter. Something about the Chief made him decide not to.

“What magazine do you write for?”

“I may do this story for View.”

“Would you mind naming some other magazines where your work has appeared?”

Bennett rattled off the names of several nationally circulated publications. He felt much as he had one day in 1944, when a German officer asked why a French farm laborer who stubbed a toe should know so many American obscenities. That had been a bad day too.

The Chief wrote the names on a pad. “I don’t suppose you’d mind,” the Chief asked, “if we checked these out.”

“Not at all,” Bennett replied. “And now I’d like to know why you’ve taken such a sudden interest in me.”

“Well, it’s funny,” the Chief explained, “but a lot of people from the big city think we’re kind of slow out here. They try to sell our citizens traps for mortar mice and all sorts of things. And this morning one of our citizens called me and said there was a man in town from View who wanted to meet the members of The Happy Days Club. He said he was suspicious because he’d heard of confidence men approaching investment clubs in one disguise or another, for the very good reason that people in investment clubs have money to invest. He didn’t say you were a confidence man, understand. He just asked us to check and make sure you’re a writer.”

“Who was this called?”

“I’d rather not tell you.”

“You asked me in here on the basis of that?”

“Not entirely,” the Chief said. “We’ve had writers around here before, Mr. Bennett. A year ago, when a farmer outside of town chopped up two mail-order brides and buried them in an onion patch, a lot of writers came down. I called one of those boys — he works out of New York too — and he said he never heard of you. So far nobody else he’s asked ever heard of you either — including, by the way, the editor of View. And the librarian here has been going through the Reader’s Guide and she can’t find any record of where you ever had anything published. Maybe if you’d tell me the dates where some of your stuff ran, she could look it up, and we could both forget the whole thing.”

“At the moment,” Bennett said blandly, “I just don’t remember.”

The Chief considered this. “Well, that’s too bad,” he said. “Now, you haven’t done anything illegal I know of yet, so I can’t charge you and put you in jail. Your name is Theodore Bennett — we know because you showed identification when you rented that car in Davenport. We checked. We’re great respecters of the law out here. We don’t push people around because they’re strangers. But the way it is, though, I’m afraid there’ll be a squad car or a police officer at your elbow every second you’re inside the city limits until I’m satisfied you are a writer. So if you want to operate under those conditions, you go right ahead.”

Bennett managed a weak grin. “Well,” he said, “I’m not going to argue. It’s ridiculous. But on the other hand, I’m not going to waste my time giving Canfield and The Happy Days Club national publicity if this is the treatment I receive here.” He rose. “I saw a pay phone near the sergeant’s desk on my way in. I’ll telephone Gordon and call the whole thing off.”

“Use my phone.”

“Wouldn’t think of it. I don’t want to waste a cent of your taxpayers’ money.”

Bennett left the Chief’s office. He fumbled clumsily through a telephone book for Gordon’s number, taking plenty of time. Then he called Gordon and abruptly informed him he was leaving town and wouldn’t write a story about The Happy Days Club after all. He hung up, leaving Gordon in mid-sentence, and returned to the Chief’s office for his attaché case and Wall Street Journal.

“A couple of my boys,” the Chief said genially, “will go with you to your motel and see to it you get packed proper and on the right road back to Davenport. If you drive fast, you might reach there before dark.”

Two uniformed officers drove Bennett to where he had parked the rented car, then followed him to the motel. Bennett packed in five minutes and checked out. They stayed with him to the city limits, pulling to the curb and watching as Bennett gunned the motor and roared out of sight over a hill.

Bennett drove at high speed for about five miles. In the future, he vowed, he’d provide himself with a solid cover story and appropriate supporting documents no matter how innocuous the assignment seemed. Apparently he had vastly underestimated the sophistication of Iowa investment clubs — and of the Iowa police.

When Bennett came to a strip of roadside stores and drive-ins he bounced to a stop in a gravel parking area. He hauled his attaché case from the back seat and opened it, exposing a transistorized tape recorder built into the bottom. Bennett had activated the recorder just before placing the attaché case on the radiator in the Chief’s office. No matter how the conversation went, it had seemed a good idea.

Quickly Bennett reversed the tape, pushed the playback button, and lit a cigarette, listening to a recording of their conversation, to the point where the Chief had said, “Use my phone.”

“Wouldn’t think of it. I don’t want to waste a cent of your taxpayers’ money.”

Then he heard the door close as he left the Chief’s office to telephone Gordon. And then the Chief did what Bennett had hoped he would do. He picked up his own telephone and dialed a number.

“Hello. Mrs. Price? Chief Waner. Your husband home? Hello, Frank. You were right. He must be some kind of swindler, although I never heard of this investment club approach before. But he sure isn’t a writer. Don’t worry. We had a little talk and he’s leaving Canfield this afternoon. He seemed sensible enough not to try to come back. Thanks. Glad you put me on to this guy before he did any damage.”

The Chief hung up.

Frank Price, Bennett knew without having to check his list, was a member of The Happy Days Club. What’s more, he was one of the three men on the stock selection committee.

Bennett turned the recorder off and looked around. What he needed now was a woman.

He found her behind a counter in a diner. She was reasonably articulate and, from the way she talked back to truck drivers, she seemed to have plenty of nerve. Bennett had to drink two cups of coffee before the place cleared out and he was alone with her. The cook in the back was engrossed in a telecast of a baseball game.

“Miss,” Bennett asked, “can you dial Canfield direct on that pay phone?”

“Yes, sir.”

“Well,” Bennett said, “I’ll give you twenty bucks if you make a call for me. It will take you less than five minutes.”

“You’re crazy,” she said.

He pulled twenty dollars from his wallet and pushed it across the counter. “There it is. No fooling. In fact, I’ll make it thirty.” He extracted another ten.

“I don’t want to get in trouble,” the girl said.

“You won’t.”

“Why don’t you call?”

“Because I want someone to impersonate a telephone operator.”

“That sounds illegal.” She advanced and fingered the bills.

“It is a little illegal,” Bennett admitted, “but there’ll be no risk for you. You’ve heard of private investigators, haven’t you? I can’t tell you any more than that. But if you make the call and hang up, nobody will be able to trace it. And even if they did trace it, you could always say some woman came into the diner and used the phone.”

“What do you want me to say?”

“Say, ‘This is the long-distance operator. The charge on your call to San Diego is twenty-eight dollars and nineteen cents.’ I have reason to believe this party just made a long-distance call, although probably not to San Diego. The party will probably be so mad at you that he’ll volunteer information about any long-distance calls he did make this afternoon. If he doesn’t, ask him if he made any long-distance calls, and to where. Get the out-of-town number if you possibly can. If you can’t get any information after a minute or two, say, ‘This is Albany 4-5634, isn’t it?’ He’ll say no, because his number is Albany 4-5624. Then say you’re sorry you made the error and hang up.”

“Albany 4-5634,” she repeated, reaching for the thirty dollars. “Okay, hon. I’ll go along. Got a dime?”

Twenty minutes later Bennett climbed into his car and drove to the next river town. There he turned right and crossed a bridge over the Mississippi into Illinois. The road wound down the river’s foothills and then flattened out into farm country. It was dark when Bennett checked in at an eight-unit motel in a tiny junction called Blackford.

There was a telephone booth in the parking lot and Bennett called James from there.

“Where’ve you been?” James demanded. In the background, the roar of guns from a television set mingled with youthful screams. “I got a pack of Cub Scouts in my living room and can hardly hear you.”

“I got chased out of Canfield.” Bennett reported, “by the Chief of Police. He knows I’m not a writer and he thinks I’m a confidence man.”

“Some industrial espionage agent you are,” James said sarcastically. “What happened? Your false mustache fall off?”

“Wait a minute,” Bennett said. “The Chief didn’t think this up on his own. He was tipped by a club member named Frank Price. Frank Price is also a member of a three-man committee that decides what stocks the club will buy and sell.”

A moment of silence ensued.

“Are you thinking,” James asked slowly, “what I’m thinking?”

“It occurred to me at the time,” Bennett said, “but I figured it was just one chance in a million.”

“Well, the odds are shortening. I’ll have Barney work on that angle first thing tomorrow. Where are you now?”

“Blackford, Illinois. I’m going to sack in here tonight.”

“You’ll never get back to New York the route you’re taking. Drive to some place with an airport and catch a plane. I’ll send another agent to Canfield with a better cover.”

“I’m at Blackford because I had a girl call Price to find out if he placed any long-distance calls after I was run out of town. She pretended to be a long-distance operator. And Price did make a long-distance call this afternoon. To Eaton, Illinois, which is twelve miles from Blackford.”

“It’s probably a waste of time.”

“Maybe. The girl couldn’t get the Eaton number that Price called. But Price has a brother, William, who lives in Eaton. I learned that from some social notes about him in the Canfield Gazette morgue. It will only take a day to check the brother out and see if he has any connection with the Gibraltar Fund.”

“Since you’re there anyhow, go ahead. I’ll hold up on that other agent. Come to think of it, Price called that Chief of Police so fast when he heard you were in town it’s like someone pushed a button. He must have known you were coming. I got a hunch that by this time tomorrow we’ll both have arrived at the same conclusion.”

In the morning Bennett drove to Eaton and parked on a side street. He walked a block to the business district, entered a drug store, bought a Wall Street Journal, and stepped into a telephone booth. He flipped through the book to PRICE, WILLIAM J. and dialed the number.

A woman answered.

“Good morning,” Bennett said. “Is your husband there?”

“He’s asleep. He’s always sleeping at this hour. He doesn’t get in until three.”

“When can I reach him?”

“Who is this?”

“I represent a firm doing market research for an advertising agency in Peoria. We’re surveying all property owners in Eaton.”

“Well,” she said irritably, “why don’t you get him at work, then? He doesn’t like to be bothered at home. Call him at the restaurant this afternoon.”

“What restaurant is that?”

“Why, Betty’s, of course,” she said, hanging up.

Bennett hung up and opened the book to the yellow pages. Under “Restaurants” he found a display ad for BETTY’S — Steaks, Chops, Chicken, Cocktails, Open 8 a.m. to 2 a.m. Bill Price, Prop.

He left the booth and walked back to the car. He drove to the address listed in the telephone book for the restaurant, getting directions from a small boy on a bicycle. The restaurant would be as good a place to begin an investigation of William J. Price as any.

The restaurant, a roadhouse, had been converted from an old farm building on the outskirts of town. Bennett pulled into the parking lot but didn’t get out of his car. He didn’t have to. Because a foot-high sign in the window proclaimed: BETTY’S — HOME OF THE ORIGINAL 25-CENT MARTINI.

Michael Dane James handed the report to Allen — he, Allen, and Bennett were sitting in James’s office.

James explained: “Sam, the owner of that comfortable two-bit cocktail-hour martini joint across from your building, wired your reserved booth for sound. The mike was hooked to a tape recorder in his office. Barney found the mike in ten minutes when he joined us for a drink yesterday. A restaurant or bar owner bugging tables isn’t unheard of, you know. Usually they say they’re just checking customer reaction to food and service and whatnot. In this case it’s obvious one of Sam’s motives was to get tips on stocks. His location in the financial district would be a natural for that His twenty-five-cent martini between five and six would be a lure to bring people in. And when he got the right people — like top decision-makers for one of the nation’s big mutual funds — he reserved a booth for you regularly, to make sure he could hear everything you had to say.”

“As I get it,” Allen said, “Sam’s connection with The Happy Days Club was through his brother-in-law.”

“That’s right,” Bennett said. “Sam came from Eaton originally. He and his sister, Betty, ran a roadhouse there. After Sam left for New York, Betty married William J. Price, and he took over the roadhouse. As time went on, and Sam got established here, he started relaying some of his inside stock information to his sister and her husband, William Price. And William, in turn, passed it on to his own brother, Frank, who lived in Canfield. Frank belonged to The Happy Days Club and got on the selection committee. Once on it, it wasn’t much of a trick to control it. If necessary, he could take one of the other two committee members into his confidence, and the two of them could always outvote the third member. I’m sure most members of the club had no idea they were using information stolen from the Gibraltar Fund.”

“Sam taped our conversation the day we were in his place and you gave us the assignment,” James said. “He knew, then, that Bennett was going to Canfield in one role or another. And he had a brief look at Bennett when you ordered martinis for us. When Sam heard the tape he must have panicked. No doubt he called his brother-in-law, William, who in turn called Frank and warned him Bennett was on the way. So the minute Frank Price learned Bennett was in Canfield, he asked the police to check Bennett, hoping Bennett would be run out of town.”

“The mystery is solved,” Allen admitted, “but it does leave me with a dilemma.”

“I don’t think,” James smiled, “that The Happy Days Club will follow the Gibraltar Fund’s lead any more. This probably scared the daylights out of William and Frank Price.”

“Nevertheless,” Allen said, “the problem remains: What do we do about Sam? If we expose him, we may still get all the publicity we’ve been trying to avoid. And if we say nothing, he’ll go on eavesdropping on his patrons.”

“If it were up to me,” James suggested, “I’d pass the word discreetly to your employees never to go into that place again because it’s bugged. The news will get around the financial district fast enough, and Sam’s will die a slow but certain death.”

“Why,” Bennett offered, “don’t you just sit there, drink his martinis, and pass along tips on stocks you think will go down instead of up?”

“I like that,” Allen grinned. “Between all of us, we could give Sam enough bad advice to bankrupt him in thirty days. But we don’t want to hurt any innocent investors — even in Canfield, Iowa. No, I think we’ll adopt Mr. James’s suggestion.”