by Greg Wilson
“The fit?” Hartman straightened up. He drew a breath and leaned forward, looking sideways at the monitor. “Here’s the fit, Kel.” He shuffled through the papers on his desk, found the one he was looking for and spun it around towards his daughter. She looked down, tracing the lines of company names and the domiciles beside them: Monaco, Grand Cayman, Cyprus, Hong Kong, Andorra. Half a dozen others. Her father’s voice started up again.
“List one: the offshore companies listed here are all ultimately controlled by Marat Ivankov. Don’t ask me how I found out but it cost me a lot of money so don’t expect a big inheritance.” He rifled through the pages again. Another sheet of paper; another list. “List two: the names of these companies will be more familiar.” He watched his daughter’s sharp gray eyes scan down the page. “Six major US-based Fortune 500 corporations in which the offshores on list one have acquired major interests over the last eighteen months and…” he passed her a third printed page. “List three: Six Fortune 500 companies where Malcolm Powell is either a director or advisor to the board.”
Kelly drew the last page closer. Compared it with the one before. “They’re the same.”
“Exactly.” Hartman parted his hands. “And now it looks like you can add a seventh. MISSION TECHNOLOGIES. That was one I didn’t know about. So while you were whipping up that great clam linguine I did some more research on recent trades in MISSION TECHNOLOGIES stock.” His fingers skipped to the mouse beside the keyboard and another page jumped open over the ELECTROSET data. Kelly’s eyes tracked the lines on the screen, counting numbers. Her father’s voice intercepted.
“Let me save you the trouble. Close to two per cent of MISSION TECH changed hands over the last couple of weeks before it was announced they were the front-runner for the contract to develop the high-powered microwave system. That’s near enough to half a billion dollars.
Her eyes widened and she looked up.
“It’s going to take me a few weeks and what’s left of the family fortune to trace the buyer, but I don’t think there are going to be any surprises.
“Bottom line, Kel? I believe Malcolm Powell is Ivankov’s point man here in the States. Powell is establishment with impeccable credentials and connections. How does it all work? My guess is Powell uses his connections to identify the opportunities then relies on them to get himself positioned on the inside of these businesses with some kind of board appointment or advisory role. Then when he’s on the inside he does two things. First he feeds price sensitive information and intelligence back to Ivankov who places his bets accordingly. Second – because government relations is Powell’s acknowledged specialty – he’s able to use his influence and the company’s money to finance rewards in the way of donations to his political patrons… All out in the open and declared, and completely above board.
“And as for the connection with ELECTROSET? Hartman rifled through the pages strewn across his desk, found what he was searching for and passed it to his daughter. Take a look at this, Kel.
It was an extract from a Wall Street Journal article several weeks before. Kelly scanned the printed headline.
NASDAQ Junior ELECTROSET announces Microwave Shield Breakthrough
Hartman watched her. “Upstairs when you mentioned how MISSION TECHNOLOGIES is involved in developing the high-powered microwave system, something clicked. Then I remembered seeing this piece in the Journal a while back so I came down and ran an archive search and presto! Where would we be without computers?”
Kelly’s eyes dropped to the story below the banner.
Chicago-based electronic technology minnow Electroset Inc. has announced a possible research breakthrough in its quest to develop a repulse shield to protect computers against the threat of high-powered microwave attack. The company’s announcement late yesterday saw Electroset stock spike 30 per cent to an all-time high in late trade, taking the NASDAQ listed junior’s market capitalization to just under the $1 billion mark. However analysts predict that if system trials due to be undertaken later this month show the technology to be as solid as the company claims, this could be just the beginning of a meteoric rise in stock value.
Kelly’s gaze tracked up from the page to the screen.
Hartman nodded at the numbers. “Like I said, close to 40 per cent of ELECTROSET has changed hands over the last three months. I haven’t done the math but I’d say that cost someone two or three hundred million. I’d also guess that most of it’s been picked up by the same offshores on the first list or a dozen more related to them.
His daughter looked across at him sharply. “If Ivankov’s the buyer without declaring it, wouldn’t that be in breach of Securities & Exchange laws?”
“Probably. Not to mention the whole insider trading thing. But since when do you think minor details like that would be a worry for someone like Ivankov?”
Kelly’s eyes returned to the screen. Hartman watched.
‘Still don’t get it?”
She shook her head.
“Ivankov’s playing both sides of the table. If you were MISSION TECHNOLOGIES and you’d just been awarded a major contract to develop high powered microwave for the US government, would you want another company out there with an opposing technology that would render your own worthless? I don’t think so.”
Kelly’s eyes widened in realization “So MISSION TECHNOLOGIES is going to have to buy ELECTROSET?
“Correct. Well, probably correct. Consider this, Kel: It’s not just the commercial worth of the technology, it’s the strategic and defensive value. What’s ELECTROSET worth to any regime that may be nervous we might try and zap them with microwaves sometime in the future?”
Kelly’s eyes tracked back and forth considering possibilities. “So it could turn into a bidding war. And Ivankov can’t lose because he’s playing both hands.”
Hartman nodded. “Exactly. There’s no way we can be sure of the final game plan but you can bank on the fact that Ivankov’s going to walk away from this with billions.”
He shook his head with reluctant admiration. “Clever, huh? The big issue for us though is that with technology like this in play it’s also a matter of National Security, which is the message I’ve been trying to get them to understand in Washington. These technologies are strategic assets but for Ivankov they’re just pawns in a game. It’s all about money and power and the need to be smarter and tougher and more ruthless than everyone else to survive and claw your way to the top, and then stay there. That’s the way it is in Russia. The way it’s always been. The problem is, these guys aren’t just contained within Russia any longer, Kel, they’re on the loose.
“They’re everywhere.”
25
MOSCOW
Marat Ivankov’s eyes trailed across the blinking stock quotes on the flat screen monitor.
Another five per cent yesterday; seven the day before. He tapped into the portfolio program, typed a command and watched the figures reset, allowing himself a satisfied smile as his eyes ran to the bottom Line. At yesterday’s close of trade the value of his total investment in ELECTROSET had almost doubled. He clicked to a fresh page headed MISSION TECHNOLOGIES… and that was doing nicely for now as well. $480 million invested had grown to almost $850 million in just a few weeks and this was just the beginning. The real game hadn’t even started yet.
He drew a contented breath and logged off from the system. Reached for his coffee and sat back and sipped.
In two weeks’ time ELECTROSET’s repulse system trial results would be announced and the stock would take off into the stratosphere, then MISSION TECHNOLOGIES would fall on panic and that was when he would make his move. The takeover. His war chest already set aside in Monaco ready to make the 51 per cent play. Then when that was bedded down, the merger. The two corporations and their technologies folded together into a single massive entity that would make them the most powerful defense contractor in the world. And as the ELECTROSET shares skyrocketed on expectation, the two dozen front companies through which he held his stock
would start selling down, cashing out at a huge premium that would pay back the entire MISSION TECH investment and still leave him, at current best guess, with 25 per cent of the new conglomerate for absolutely nothing.
Alchemy, that’s what it was. Money from thin air! And the Trojan horse that would make it all possible was already in place. Malcolm Powell, with his unquestioned integrity and reputation and his political connections, already positioned on the MISSION TECH strategic advisory board, ready to guide the process through with his charming blueblood style. And while Powell would take center stage, behind the scenes a supporting cast was already being assembled by Ivankov’s other trusted retainers: a coterie of investment bankers and lobbyists and public relations experts and commentators who – in exchange for their obscene fees – would work day and night to see the project through to completion, more than content to remain wholly ignorant of the identity of their ultimate client.
That reminded him. Powell.
Ivankov set the Rosenthal cup gently in its saucer and shrugged back the cuff of the gown, glancing at his watch. Eight a.m. here made it eleven the previous night in New York. Time to check in. His hand moved past the hotel telephone to the oversized cell unit that lay beside it. It was longer and heavier than most. A little awkward to use but that was because the technology was still in its early stages. Its advantage on the other hand was that it was completely secure. The encryption security platform developed by a small Finnish company he now controlled made transmissions between its master unit and a half-dozen counterparts scattered around the globe totally impossible to trace or intercept. In time – six months or so perhaps – the system would be taken to the market and the rewards would be enormous. Then a year or so later another of his companies would announce that it had developed a method for breaking the codes and international security agencies would be falling over one another in their rush to secure that technology, by which time the next level of encryption platform would already have been developed and he would be ahead of the game again.
He hit the three-digit code that would connect him with Malcolm Powell and waited. Counted through a half-dozen chimes before the call was answered and the line opened up, Powell’s deep, rich voice overlaying the conversation and laughter in the background.
“Just a moment. Have to close the doors.”
Ivankov listened. Picking up footfalls on tiles. The rolling sound of timber panels being drawn along a track, closing out the chatter. Then Powell was speaking again as he walked. “That’s better. I’m in the study now.” His voice was crystal clear despite the encryption and the relays and the seven and a half thousand kilometers between them.
Ivankov pulled up a picture of the elegant, five-level brownstone. Where was it? West something. Eightieth? Eighty-first? They all looked the same.
“Okay. Sorry for the delay. We’ve got a dinner party going on here. I had the phone patched to my pager. So…” Ivankov imagined the American sinking into the high-backed leather chair behind his desk, “how are we travelling?”
Ivankov smiled briefly. He almost liked Malcolm Powell. Liked his directness and the slick, relaxed professionalism of his style. It had taken him a while to get used to the American at first but now, after a decade, he had actually come to enjoy their association. Found it refreshing, not to mention rewarding. Powell was the archetypal American success. Well-bred and educated. Accomplished businessman. Distinguished diplomat. Access to all the right ears and membership of all the right clubs. As comfortable and at ease in the polished boardrooms of New York and the corridors of the Capitol as he was on the tennis courts of Coral Gables or the tenth hole at Augusta. He must have been well into his sixties now but he was one of those men whose presence and stature had only magnified with age. Still slim and fit and erect with handsome, patrician features, sharp blue eyes and carefully cropped silver hair that all served to enhance the benevolently aristocratic image. Still, in his own mind, a ladies’ man, even if that was more show than substance. Ivankov smiled briefly, his mind tripping back absently to Powell’s last word.
‘Travelling? We’re travelling splendidly, my friend. By my calculations we’re three hundred and twenty million up already and this is only the first act.”
He heard Powell pull a breath. Impatient. “Cut the crap, Marat. You know exactly what I mean.”
He did of course, but sometimes he enjoyed toying with Powell. Pulling his strings. Ivankov smiled. Rocked back in his chair. “Ohhh… of course.” He changed the cell phone to the other ear, changing his tone as well. “It’s all under control, my friend. A week – two at most.”
There was a pause from the other end of the line.
‘Too long, Marat.” Powell’s voice was brittle. “I know this guy. He’s a goddamned bloodhound. Once he’s on to something he won’t give up.”
“Malcolm.” Ivankov closed his eyes with exasperated restraint. “What are you worrying about? So Hartman’s made some connections regarding my investments.” He flicked a hand in the air. “So what? America is a free country. I’m a legitimate, respected businessman. Nothing Hartman has come up with suggests I have broken any laws. So, what’s the problem?”
Ivankov heard the springs of Powell’s chair creak. Imagined him sitting forward, leaning into the glow from the antique lamp that sat at the edge of his cherry wood desk. “I’m not worried about what he’s found out so far, Marat.” Powell’s voice was strung with tension. “I’m worried about what he might find out between now and…” he drew a breath, “between now and his evaporation.”
Ivankov pursed his lips. Drummed his fingers on the table then closed them to a fist.
“Listen to me, Malcolm.” He was a patient man. Always had been. But now his patience was wearing just a little thin. “What do we know? What we know is that so far Hartman has identified three American corporations in which I have made reasonably significant investments. Just three… out of how many?” He answered his own question. “Out of dozens, Malcolm, that’s how many! And the only reason he has tracked those ones is because I happened to use the same investment companies for those particular plays. So maybe there are a few more he may trace but even if he were to live a normal life span he could never, never find them all. It’s impossible! And who cares? Who’s interested? As for you… so what if you are on the board of some of them or an adviser to others? What does that prove? Of course you know me. Why wouldn’t you? For heaven’s sake, Malcolm, I am an international businessman. You are an international businessman. Of course we are acquainted but there is no link between us anyone can prove. No smoking gun. So, I make a lot of money investing in companies in which you play a role. You’re a clever man, Malcolm. That’s why I invest in them. And anyway, for heaven’s sake, I make a lot of money investing in companies in which you don’t play a role. I buy and I sell and I make profits and I move on. That’s what business is all about, Malcolm. I don’t have to tell you that, surely?”
The line fell to silence. When Powell responded his voice was taut. Unconvinced.
“This isn’t Eastern Europe, Marat. They take insider trading and stock manipulation very seriously over here. If Hartman gets a chance to give his testimony to that Committee and either the authorities or the media start running with it, Christ knows where it could all end up. Okay, a lot of it’s going to be difficult or impossible to prove, but once the accusations start flying I’m finished. It’s okay for you. You can stay over there out of reach, but it’s not as easy for me, Marat. I’m American. I live here. This country is my life.”
Ivankov pursed his lips. Drew a breath and replied softly. “Let’s just run back a little, shall we? Where did all of this start? Tell me, Malcolm, whose idea was it all anyway?” He let the questions hang. Sat back, waiting out the silence.
“I’ll remind you shall I? It was you who came to me, Malcolm. You who sought me out back at the beginning through Stephasin because you were astute enough to see where I was going and you wanted to be part of it. That’s
how it started, my friend, not with my ideas but yours. And let me ask you, have I not been generous? Have I not always kept my side of our bargain?”
At the other end of the line he heard Powell pull a grudging breath. “Yes, you’ve been generous.”
Ivankov considered the word. Generous. An understatement when you thought about it. How much exactly had he transferred to Powell’s accounts over the years? Ten per cent of everything he had collected on Powell’s advice: all up, what would that have been so far? Two hundred? Three hundred million? And all without Powell ever having to risk a cent. Powell was thinking about it as well, he could tell.
“I’m not saying you haven’t been generous, Marat. It’s worked well for both of us, but this ELECTROSET deal…” An anxious pause. “I’m worried about it. Worried that it’s too big.”
Ivankov sighed. “Malcolm, think through it again. What is there to be worried about? I take a major position in Mission Technologies and I keep it. Never sell. There’s no inside trading in that. Where’s the risk?”
“The risk is, Marat, that someone starts putting all the pieces together. Finding the pattern and putting all dominoes in line. Asking questions such as where ELECTROSET got the information it needed to develop the repulse system in the first place… and how it just happened to come up with the goods at the critical time. Not to mention who’s been behind the stock build-up and whether there’s any association between the buyers. I was the one who saw the possibilities and made the introductions and set up the connections and looked after the people who needed looking after. I’m not losing my nerve, Marat. I’m just being a realist, that’s all. Christ, you know the risks I’ve taken in the past. There’ve been a half-dozen times over the years I’ve put my balls on the line for you. Starting with Moscow.”
Ivankov picked up a pen from the desk, rolled it between his fingers, studying it. Starting with Moscow. So that was it.
Powell was beginning to lose his nerve. Sooner or later they all did. Patrushev. Stephasin. The others. They’d all had their use-by dates and now Malcolm Powell’s was approaching as well. He leaned forward with the pen, scratching absently on a piece of hotel stationery. Drawing lines and angles and joining them together as Powell continued speaking.