The Capitol Game

11

They would not be caught again.

Martie O’Neal fell heavily into a seat and for two full minutes steadily ignored the man seated only two feet away and directly to his right. It was the last leg of the D.C. Metro and it roared along the tracks to its final destination, a dead stop at Alexandria station.

O’Neal, who had some expertise in these matters, briefly scanned the rest of the car while Mitch Walters studied the floor and pretended to ignore him. It was midmorning, long past rush hour, more than two hours before the lunch crowd packed the cars, shoulder to shoulder. There were two old black ladies seated at the other end of the car, clutching shopping bags and bragging full bore to each other about their grandsons. A few seats away sat a young kid wearing a Georgetown sweatshirt, with his head tucked inside the hood and his nose stuffed in a thick textbook. Like all young people these days, he had earphones on, his head bobbing and weaving to the music, somehow managing to combine noise with study. He wasn’t a threat.

A TFAC employee was located in each of the two adjoining cars, and after a minute, each appeared in the connecting windows with their thumbs up.

“All clear,” O’Neal whispered to Walters. The absurd precautions made him feel silly, but Walters insisted.

“What have you got?” Walters asked, still staring at the floor as if they weren’t speaking, feeling quite clever about his spycraft.

O’Neal carefully slid a manila folder onto his lap. “Here’s everything we’ve gathered since last week.”

“Looks pretty thin.”

“Yeah, well, nothing much new on Wiley.”

“That good or bad?” Walters asked, stuffing the folder in his briefcase.

“Depends on your perspective, I guess.”

“Start with is he still who he says he is?”

“On the surface, yeah, everything checks out. He’s smart and ambitious. He likes money. He’s loyal only to himself, an opportunist. This guy bounces through firms and jobs like a revolving door. We knew all that, though.”

“And below the surface?”

“Understand, I’ve got nothing tangible that argues otherwise.”

“Yeah, but I’m paying out the nose for your instincts.”

“I just don’t think he adds up. Not yet. It still feels a little disconnected. I’d feel more sanguine if I found any indication that somewhere in his past he bent the rules or played dirty.”

“Maybe the temptations haven’t been big enough.”

“That’s one way of looking at it.”

“For Christsakes, he stands to make a billion dollars. The deal of a lifetime, O’Neal. Every man has a price and this one would bend the pope’s backbone into a soggy noodle. You thought of that?”

“Sure,” O’Neal said and shrugged. In a lifetime of peeking through underwear drawers, he had earned a doctorate on human foibles and sins. The Jack engaged in this deal and the Jack from the past didn’t add up.

“You’re not convinced, though?”

“Look, you pay me to be paranoid, and I’m good at it. This deal you’re running, it’s not exactly clean, is it?”

“You could say that.”

“That’s what I figured. So here we got this guy, and there’s no hint in his background that he’s done anything like it. Not once, never. A few of our guys went up to New York and nosed around. Everybody said the same thing. Straight shooter. Stand-up Jack. Honest Jack. I’d just like to see a little moral consistency here.” He slipped a piece of gum in his mouth and began chewing hard.

“What do you suggest?”

“We gotta keep looking.” A brief pause. “If we don’t find anything, get the hook in him in the event he tries any funny business.”

“We tried that, Martie, remember? Your clowns blew it. What a disaster. I’m not exaggerating, cost us a billion bucks.”

O’Neal shifted his broad rear on the seat. “You asked my advice, and you got it.” He pulled a handkerchief out of his side pocket and blew with all his force into it; then he balled it up and slipped it back into the pocket. “You’re flying without a net here, Mitch. It was me, with all the money involved, I’d want a good hard grip on his balls.”

Walters picked at his nose and thought about it. He bent forward and rubbed his eyes. O’Neal was obviously playing on his anxieties, making a pitch for more action, more money, a fatter contract. And though the whole board had bought into this deal, Walters had to admit that the risks for him, personally and professionally, remained enormous. If Wiley somehow managed to screw him, there was no doubt who would be out tap-dancing on the gangplank. The more he thought about it, the more uneasy he became. Jack Wiley was driving this train, juking and jiving, always a step ahead. And truthfully, Wiley had so far outsmarted the best and brightest CG had to offer. That little stunt with the burglars and Jack still stung. The way Jack had burned him, right there in front of everybody, still rankled. After a moment he said a little hesitantly, “You understand we can’t get caught again?”

“Look, I know that last thing was stupid and sloppy. It-”

“Stupid?” Walters hissed. “Oh, it was more than that. It was horrible.”

“Yeah, well, you said fast, and the guys went in blind. We’ll put some ex-spooks on it this time. They’re real good at this sort of thing.”

“Don’t underestimate him again. I mean it. He’s very smart, and very cautious.”

O’Neal bunched his shoulders and chewed harder on his gum. “We know that now.”

“You know the phrase ‘plausible deniability’?”

“Hey, these guys invented that credo. There won’t be a trace leading back to you. Don’t worry.”

“I want full approval before you do a thing.”

“Naturally.”

“What about Arvan?” Walters asked suddenly, changing the subject-apparently the issue with Jack was settled.

“We bugged the old man’s house and got a phone intercept. Still working on gettin’ one into his car.”

“He suspect anything?”

“Nope. The old man believes Wiley just swooped in out of the blue. A typical Wall Street vulture, that’s what the old man kept calling him.”

“Is he worried?” Walters asked, barely able to conceal his excitement. He loved getting these insights. The game was so much more fun this way.

“Yeah, definitely. He and the wife stayed home last night. You’d’ve loved that conversation. Bickered back and forth all night. They went over the numbers again and again. It’s hopeless. They’re worried about the kids.”

“Explain that.”

“They figure they had their run. They’re old now. The company was the inheritance they were gonna pass down. It’s the family piggy bank, and now it’s sprung a big hole.”

“And how are they leaning?”

“The old lady, she says call Wiley first thing in the morning and cut a deal. Dump this turkey before it destroys them. They’re too old to recover from such a disaster. Once the banks move… the company, the house, their cars, they could lose everything.”

“Smart lady.”

“Yeah, but the old man, well, he just ain’t so sure yet, Mitch.”

“What’s he waiting for?”

“He kept droning on about this miracle product. Says if he could just get it into the right hands in the Pentagon, all their troubles will be over.”

Walters broke into a loud, satisfied chortle. “Ridiculous. It would take at least a year of tests and studies before the Pentagon showed the slightest interest. He’s got a day or two, at most.”

O’Neal did not join him. He inserted a fresh piece of gum through his lips and chewed hard for a moment. The old ladies in the middle of the car had moved on to a heated discussion about the price of groceries; the kid remained engrossed in his book. O’Neal reached into the inside breast pocket of his jacket, removed what appeared to be a transcript, then flashed it in Walters’s big face. “The guy ain’t stupid, Mitch. He knows that.”

“Oh. Well, tell me about that.”

“He called his financial guy a little after midnight. Mat… Mat…”-a hurried glance at the transcript-“Mat Belton. Told him to get ready.”

“What are you talking about?”

“Told him to hit the phones hard first thing in the morning. Find somebody with deep pockets, offer him a big cut of their miracle product. Belton estimates ten million will do the trick.”

“What trick?”

“Bridging money, he called it. One guy is all they need-one moderately rich guy willing to stake ten million in return for fifty or a hundred million when the product comes home to roost.”

Walters rocked back in his seat. He rubbed his forehead and thought about this. “He’s more desperate than I thought,” he concluded. But rather than look gloomy he broke into a huge smile.

“What’re you smokin’?” O’Neal asked. “Sounds like a great idea to me.”

“His company is publicly listed. We’re talking major SEC violations. Jailhouse stuff.”

O’Neal stared back with a blank expression. Lacking a background in finance, he had no clue what the problem was.

Walters shook his head and curled his lips as if Perry Arvan’s plans sickened him. “It’s insider trading. Offering an outside investor confidential, inside knowledge as a lure for his money, information he hasn’t even shared with his own stockholders, that’s a serious crime.”

“If you say so,” O’Neal replied, as if to say, big deal, so what? The absurdity that they were breaking even more serious laws seemed relevant only to him.

“Also, private loans are a corporate no-no,” Walters went on, now sounding very righteous. “The polymer was developed on company premises, using company employees, on company property. The shareholders own it. He can’t sell off pieces or encumber them with a major debt without their express knowledge and approval.”

“I think he’s gotta get caught first,” O’Neal noted very reasonably.

“You have this conversation on tape, right?”

“Clear as a bell.”

“So there it is.”

“Yeah, there it is… a totally inadmissible conversation.”

If that minor technicality worried Walters, he gave no hint of it. With a great screech the train ground to a stop; the two black ladies got up and waddled off, followed by the student, bouncing and rocking to his iPod. Both men sat staring at the floor, neither moving.

“Send me the tape,” Walters finally announced, then stood, adjusted his suit, and, looking suddenly purposeful, departed.

“No problem.”

Jack was seated in his car in the middle of a large parking lot, reading a paperback novel, when the long black limousine slid up and parked less than three feet away.

Mitch Walters popped out of the back, gripping a briefcase and unloading a smug grin.

Jack stepped out of his car and they shook, rather limply. “Listen, Mitch, I don’t think this is such a good idea,” Jack said.

“Hey, you’re right, Jack, it’s a great idea.” Walters spent a moment surveying the parking lot, the surrounding streets, the large collection of junkheaps parked around them; not a single BMW or Mercedes in the lot, but plenty of old pickups that seemed to be fading and rusting before his eyes. His stare stopped at the large pile of red bricks with the words “Arvan Chemicals” across the entrance.

“What a dump,” Walters remarked with a sour expression. He withdrew a long cigar from his pocket, neatly clipped the end, and spent a long moment puffing and sucking to get it lit. The call he made to Jack three hours earlier had not gone well, to put it mildly. Jack had confidently asserted that he had matters well in hand, before Walters unloaded the news about Perry Arvan’s hunt for a white knight willing to make a generous wager in return for a big chunk of the holy grail.

Just as he suspected it would, this news caught Jack flat-footed and momentarily baffled: it was a rare opening and Walters exploited it to insist on taking a more active role in the takeover. Jack’s protestations were vehement and a total waste of breath.

Walters had his mind made up: the time had come to push Jack into the backseat; time for the Capitol Group, and for Walters himself, to take the lead. It was also the first advantage Walters had on Jack and he intended to use it for all it was worth. He ended the conversation abruptly by informing Jack that he was about to jump on the smaller corporate jet for a fast sprint to Trenton Airport, drive to the factory, and pay a nasty visit on Perry Arvan.

Jack could join him or not. His choice. Didn’t matter to Walters.

“You say you have Perry on tape planning to commit a crime. Did I hear that right?” Jack asked, giving Walters a wary look.

“Yep, him and his money guy, Belton.”

“What crimes?”

“Conspiracy on top of two or three major SEC violations. Dead to rights. One of my corporate lawyers listened to it and said it’s lockdown stuff. And if they called across state lines, you can add interstate fraud.”

“Where did you get these tapes?”

“None of your business,” Walters snapped, smirking and making no effort to disguise how much he was enjoying the moment. It felt so good to be on top for a change. “You said it yourself, we’re partners. I don’t have to tell you a thing.”

“Is it legal?”

“Who cares?”

“In other words, no.”

“So what?”

“Was this the handiwork of your pals at TFAC again?”

“Just say I came into possession of a very incriminating tape. Now I intend to use it. Arvan thinks he’s found a way around you, Jack, but I’m going to stop him.”

“I don’t like it, Mitch.”

“You’re breaking my heart.”

“You intend to blackmail him,” Jack said, shaking his head.

“Think of it as saving him from himself. That’s how I think of it.”

“You’ll have to explain that.”

“He’s about to engage in an illegal act. Several acts, actually. Like a Good Samaritan, I’m stopping him from making a bad choice.”

“Very creative reasoning.”

“Thanks, I’m quite proud of it.”

“I suppose I can’t stop you.”

“Good guess. You can come along and support me or get lost.”

Jack looked frustrated but tagged along.

Agnes Carruthers did not recognize the face of either of the two men who barged into her office, though the name of the younger one struck a chord from their phone conversation two days before.

“He’s extremely busy,” Agnes staunchly insisted, edging forward and pursing her lips. The bigger of the two men was standing two feet from her in an effort to intimidate. This was her boss, her office, her domain. “You should’ve called, asked for an appointment,” she insisted, raising her sharp chin and staring down her nose.

Walters placed his big hands on her desk and launched forward, about three inches from her face. “Listen up, lady. I’ve flown up from D.C. and don’t you dare tell me no.”

“You listen up, buster. Mr. Arvan’s got more important things going on. I’ll see if I can fit you in next week.”

“You won’t be in business next week,” Walters barked with a nasty, knowing smile. Another day or two and he would own this company. He had just made his first executive decision: he would personally fire this old hag and shove her out the door. He hoped she had a pension. He would personally assure she never got a dime. “You know who I am?” he asked.

“Sure do,” Agnes replied, not backing down an inch. “You’re the fella who’s gonna be outta here in two seconds, or I’ll call security.”

Jack eased himself around Walters. “Excuse me,” he said, using a hip to edge Walters aside, and putting on his best smile. “Please, if you can just tell him we’re here. Let him decide, please. If he says no, we’ll leave quietly.”

Agnes’s eyes moved back and forth between this nice-looking young man with such pleasant, respectful manners and the big, blustery windbag who was glaring back with a threatening sneer. “All right,” she said to the young man, firing another withering look at the bully before she got up and disappeared into her boss’s office.

She popped out a moment later, pink-faced, and ushered them in. Perry Arvan and Mat Belton were seated in chairs in the corner of the office, surrounded by stacks of spreadsheets. Between the mountainous piles of paper and their drawn expressions, they had been there all day, going over the dismal numbers and hoping for a miracle. Perfect, just perfect, Walters thought.

Jack stiffly performed the introductions, then moved against a wall and remained quiet. “What’s this about?” Perry asked, dropping a sheaf of papers and edging forward in his chair.

Walters pointed at Mat Belton. “I suggest you ask him to leave.”

“Why?”

“We’re going to have what you might call a sensitive conversation. It would be best for all concerned to keep it confidential.”

“I trust Mat.”

From the wall, Jack said, “Mr. Arvan, you might want to do as he says.”

Perry and Mat exchanged looks. “All right,” Mat said to nobody, then after a moment’s hesitation, to Perry, “I’ll be outside the door if you need me.”

The moment he left, Perry asked Walters, “Who are you?”

“The CEO of the Capitol Group. I’m sure you’ve heard of us.”

“Nope, sure haven’t.”

“We’re partnering with Jack here to buy your company.”

“What’s that mean?”

“He brought the idea to us and we decided to back him. Provide financing. Help market the products, that sort of thing.”

“I see.”

“So what do you say?”

“About what, Mr. Walters?”

“The sale. You going to pull the trigger or not?”

“Pull the trigger?” Perry reclined into his seat and his fingers formed a steeple in front of his mouth. “That how you boys speak of it? You make it sound so easy, so simple. A mild squeeze and it’s over.”

“Answer the question.”

“All right. Haven’t made up my mind.”

Walters sauntered over to the desk and put down his briefcase. With a theatrical gesture, he flipped it open and withdrew a small tape player, preloaded and ready to roll. Perry quietly removed his glasses as Walters punched play. The sound of Perry’s voice speaking with Mat Belton came through loud and clear.

“Listen,” Perry was saying in a tone garbled with excitement or perhaps relief, “I’ve got a great idea for saving the company…” and so on, as he ordered Mat to prepare a list of every wealthy investor in the company and out, rich men they would begin speed-dialing in the morning. Perry sat, wiped the lens of his glasses, and listened. Except for a small flutter around his left eye his face was entirely impassive. The call lasted three minutes and ended with him and Mat debating how far they should go to sweeten the lure-Mat argued low, Perry high-deciding in the end to offer a thousand percent return.

“How’d you get that?” Perry demanded the moment it ended.

“Why does it matter?” Walters snarled. He wasn’t about to confess to Perry that his phones were bugged; it was self-evident anyway. If pushed, he would put on a show of innocence and insist that somebody-he didn’t know who-had left the tape on his doorstep. An anonymous donor. Who knew how he or she got it? And who cared? That the alibi was as woefully implausible as it was nebulous and impossible to disprove made it all the better.

“It matters to me,” Perry insisted with a dark squint.

“It won’t to the SEC when they listen to it. They’ll only hear you on the tape, plotting with your CFO to break the law.”

“I have ears. I know what it is.”

“Oh, good. Saves me the trouble explaining all the trouble you’re in. Do the words ‘criminal conspiracy’ mean anything to you? Old men don’t fare well in prison.”

Perry looked over at Jack. “You in on this too, son?”

Jack stared at the floor and refused to answer.

“So what’s the deal?” Perry asked in a matter-of-fact tone, again confronting Walters.

“Glad you asked. You agree to sell the company today and this tape will disappear.”

“And if I don’t?”

“Bankruptcy. Prison. Disgrace. It won’t be pretty. The FBI and SEC will be crawling all over this place tomorrow. They’ll subpoena your phone records, see who you called, and probably arrest them, too.”

Perry sank back into his chair and released a heavy sigh. “Don’t leave me much choice, do you?”

“Let me make this clearer.” Walters fought back a smile and mustered his most threatening snarl. “You have no choice, absolutely none.”

“Okay.”

The answer shot out so fast, Walters was obviously a little taken aback. He shifted his feet a moment, peered at Perry in astonishment, then recovered his balance. “Okay?”

“You got ears, too, Mr. Walters. Assuming we agree on a price, let’s get this over with.”

Before Walters could answer, Jack pushed off from the wall. “One hundred million dollars,” he announced, loudly and distinctly, like it was a nonnegotiable figure.

“A hundred million?”

“Yes, and in return, you’ll sign over all rights, all patents, all intellectual rights. All properties will be ours.”

Perry popped forward in his chair, wiping his hands through his white hair, apparently stunned. “A hundred million.” He gawked at Jack. “That’s a very generous offer. Why so much?”

“I think you know the answer.”

“The polymer.”

“Yes, that’s the deal. You walk away with a hundred million and we own the polymer.”

Perry stared at the wall a moment, dumbfounded. It was impossible to tell if he was angry, shocked, merely crushed, or all of the above. This was the first blunt admission of what this was really about. They didn’t care a whit about his company, his employees, the chance to resuscitate the plant and turn around the business that had been in Perry’s bloodstream for the better part of his life.

No, this was about only one thing: the polymer he had created with his own ingenuity and bare hands.

“How’d you learn about it?” he asked after a painfully long moment.

“I’d prefer not to say,” Jack replied, avoiding Perry’s eyes.

“You mean you won’t say.”

“All right, that, too.”

“Well, if that’s what you boys want, I think I’ll ask for more. It’s worth a fortune, probably billions. You fellas obviously think so. I’m not giving it away for a song.”

Walters shifted his large bulk and said, “Maybe you missed something here, Arvan. The price is set. This isn’t a used car lot. No haggling, no give. Wiley gave you our final offer.”

“That sounds like a threat.”

“Nice to see you’re paying attention. I can use that tape and pick up the pieces afterward.”

Trying to sound reasonable and restore a little amity to the conversation, Jack said, “Without the polymer you wouldn’t get one million for this company. You couldn’t give it away. You’re a hundred and fifty million in debt, and your business is collapsing around you. Take our price. Get out now while you still can.”

The bluff crumbled in Perry’s lap. “Guess you’re right,” he said, as if he had ever contemplated otherwise.

“Then you agree to the sale?” Walters asked.

“You fellas are holding me up, but you’ve got a deal. Uh… you know, long as you’re assuming the debt, too.”

“That’s part of the package,” Jack assured him quickly, speaking for both of them. Now that they had him on the ropes, it was important to meet his demands; don’t give him a chance to rethink it or back out. Jack told him, “I’ve already negotiated this with the banks. They’re prepared to sign a new covenant tomorrow.”

“And my employees?”

“Same as before. Three months’ severance to any employee who wants to leave. But there is, well, one last condition.”

“What’s that?”

“We’d like to present this to your shareholders and employees as a friendly takeover. We don’t want any complications, strife, or bad feelings. Between your shares and three other large stockholders-Parker, Longly, and Malcome-there’s enough votes to lock this in. This is important, Perry. We expect you to round up their support. Tonight.”

“Then you better offer the shareholders a decent price.”

“Seventy cents a share. That’s more than fair. About twenty percent above today’s market price. There’s thirty million shares outstanding. You own eight million, right?”

“Sounds about right. Mat knows a bit more about it than I do.”

Mat was called back into the room, and while he and Jack fought and haggled over the details, Mitch Walters leaned against Perry’s desk and dreamed about the polymer and its miraculous ability to print money. It was a remarkable coup, one Walters was quite proud of. The Capitol Group would pay Arvan $100 million in cash, hand over another $15 million to the shareholders-for less than $150 million in cash, a pittance, CG would own the most extraordinary military technological breakthrough of the decade. Sure, there was another $150 million in debt, and of course, the $20 million bonus promised to Jack to be factored into the equation: still, the grand total for a corporation with the size, resources, and wealth of the Capitol Group barely came to a rounding error on the annual statement.

It would not be CG’s money, anyway. Not a penny of CG’s capital would be at risk. Within a day he would dispatch a delegation to Russia or the Middle East and see who wanted a piece of the action. Both places were flush with billionaires hunting for profitable investments. The money would come quickly and easily, Walters was sure. Russia’s growing class of fabulously wealthy were particularly anxious to park their cash overseas. And the Saudis and Kuwaitis, given the spike in oil prices, were again flush with petrodollars, a flood of cash, a venture capitalist’s dream.

Two hundred million would be more than enough, but why not go for three? For that matter, why not five hundred?

What a day, what an accomplishment. He planned to get the boys in CG’s publicity department to kick it into overdrive: they could work all night for all he cared. Walters wouldn’t settle for less than the covers of BusinessWeek and Investor’s Business Daily. That night he would make the rounds of a few business cable shows that would allow him to boast and brag to his heart’s content.

A large front-page spread in the Wall Street Journal was something he had always dreamed of, something that now looked like a distinct possibility. He wondered if he could get a copy of the Journal’s portrait of him as a trophy to hang on his wall. He would put it right behind his desk, just above his head, so it would be impossible to miss. What a statement that would make.

He would use the trip back to D.C. to rehearse and refine his performance. He would be tired by then, but was sure he could muster enough energy and enthusiasm for this one bold stroke, a fast-paced dash through the cable business shows.

Not overly boastful but not humble either, he told himself. Strike just the right note: tout the product and himself but don’t beat it to death. Don’t grandstand but also don’t leave any doubt whose vision and deft hand closed the deal.

It was a chance, the first of his three years as CEO, and he intended to use it for all it was worth.

He was tired of all the former government bigwigs around him. That oversize board filled with grandstanding political has-beens, the sinecures to former admirals and generals, and too many deputy or assistant secretaries of this or that to count. He was tired of the whole stable of Uncle Sam’s former flunkies feeding at his trough. He privately loathed them. He detested their self-importance, their inflated titles, was bored with their exaggerated war stories, nearly wretched at their endless boasting about all the people they knew, the strings they could pull, and the doors they could open.

He sucked up to them, but privately seethed.

Mitch Walters was a businessman, plain and simple. A distinguished graduate of Wharton brought in to manage the exploding complexities of a corporation that had outgrown the mental nimbleness of a bunch of ex-government hacks.

During his years as CEO, he had been bullied and sneered at, treated as little more than a hired flunky, a bookkeeper to the famous clowns above him.

A bunch of condescending, windbag know-it-alls, all of them.

That was about to change.

In a year, as the miracle polymer became the talk of the industry, as more profits poured in than they could possibly count, he would squeeze the board for a fat bonus. It would be a memorable bonus, a record payoff. He had brought home the bacon and would insist on being amply rewarded.

The start point would be seventy million-why not?-but he would settle for a mere fifty, he promised himself.

Why be greedy?