Lucifer's Banker

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by Bradley C. Birkenfeld


  L. Jafarli

  London

  I read it again, and then again. And then I read it one more fucking time while my ears nearly popped from the steam spitting out of my brain. The language was weird, stilted, as if someone were trying to impersonate a foreign national writing in English. “Unprofessional actuations”? Ladjel’s English was perfect, much more fluid than this piece of garbage. And Ladjel’s name was at the bottom, but it wasn’t a signature. It was typed. A signature’s like a fingerprint. If you’re an impostor pulling a scam, you type it.

  I walked to my veranda, flung the French doors open, and stared at the distant Swiss Alps beyond the lake. I didn’t even realize that the fax had fluttered from my fingers and curled up on the floor. No one, and I mean not a single soul except my lawyers in Geneva and Washington, knew that I’d been to the Department of Justice. Neither firm knew of my friend Ladjel, and Ladjel didn’t have a clue about my activities in Washington. Even if he had, I knew he’d never screw me this way, then show me the evidence and pretend to be warning me off like a concerned friend. Hell, he was my friend and had been for years! He was trying to save my skin.

  But who was trying to skin me? Then I suddenly remembered that Customs stop in Texas. They’d pulled Ladjel off the plane, alone, just to get his particulars, probably on orders from … Kevin Fucking Downing. And if Downing, how did he know where I was going after my trip to DC? Perhaps he’d tapped my phone and put a tail on me; they could’ve followed us to Dulles, then simply demanded the flight plan for the Citation X. When we headed back, Customs would’ve already had their marching orders, and the DOJ their dupe to use: Ladjel, a highly reputable investment banker with a Swiss passport.

  My blood boiled. Someone inside the US government, either Downing and his fucking cohorts or someone else, was trying to get me thrown into a Swiss prison cell.

  Or, worse, they were going to get me killed.

  CHAPTER 9

  TIGHTROPE

  “There is only one way to avoid criticism: Do nothing,

  say nothing, and be nothing.”

  —ARISTOTLE, GREEK PHILOSOPHER

  WHEN YOUR OWN GOVERNMENT betrays you, it’s a mule kick in the guts.

  I grew up believing in the infrangible bedrock of our American system of justice. That’s what I was taught as a kid: That no matter what might happen, my rights as an American citizen would be assured by the Constitution and the Bill of Rights, the greatest documents authored on earth since the Ten Commandments and the Magna Carta. And if I were to be accused of breaking the laws of the land, my fate wouldn’t be decided by one petty law enforcement officer—perhaps bitter, corrupt, and with an axe to grind—but instead by “Twelve Angry Men,” a jury of my peers, all good and true.

  Yes, there were days in American history of which none of us patriots were proud, yet they’d been corrected whenever they occurred. And of course there’d also been rogues in government, even of recent memory. However, I’d never imagined that something like what I’d just experienced could ever happen to me. American prosecutors and government agents couldn’t turn rogue anymore. There were checks and balances, steely-eyed watchers scrutinizing the guardians. This wasn’t Berlin of the 1930s, and the Department of Justice wasn’t the Gestapo. That’s what I firmly believed. But now I felt like some Mafia foot soldier who’d decided, for the collective good, to rat on the Godfather and reveal every blood-spattered tale of the omertà, and had wound up spilling to an FBI agent named Michael Corleone.

  The Jafarli letter shattered my world. I was no longer sure who I could trust. It wasn’t something as prosaic as discovering a cheating spouse. It was like being thunderstruck by the revelation that your entire family had banded together, taken out a $5 million insurance policy on your life, and hired a hit man to put a bullet in the back of your skull.

  I’d hate to admit this to Ladjel, but I went over every word of every conversation we’d had since his first call to me at the Four Seasons in Washington, and then all through our Mexico getaway and up to our last handshake and hugs at Dulles Airport. At least, that is, every word I could recall, because some portions of our time were inebriated. But nothing stood out; no strange slip-ups by Ladjel, no awkward probes, no overly curious queries on his part about my dealings with UBS, my planned career choices for the future, or satisfaction or lack thereof with the lawsuit results. I vetted him in my head and he came up clean. But it was ugly having to do it and I felt ashamed—and angry that those fuckers at the DOJ had made me do it.

  It was them, all right. The suspect list was a simple, five-fingered exercise. My brother Doug knew what I was doing, because I’d finally told him about it while passing through Boston on this last trip. But it sure as hell wasn’t Doug, unless he was somehow still pissed off over some adolescent squabble we’d had as kids. One finger down. And it wasn’t Ladjel; two fingers down. And certainly not my two attorneys, unless they’d been taught in law school to take their clients’ money and then get them knocked off. That was four fingers down, and the last one was Downing and the DOJ. That famous Marlon Brando line from On the Waterfront screamed in my head. “It was you, Charlie. It was you.”

  But why the hell would Downing do it? The Department of Justice and Kevin Downing had set me up; they’d tailed me and Ladjel to Mexico, had Ladjel pulled off the plane to a run a background check on him, then stolen his identity and used him in some dark scheme to expose me and make me back off. But why? It didn’t make sense, unless what they really wanted was to shut me up. And as much as I already couldn’t stomach Kevin Downing, somebody else had to be pulling his strings. Who’s your fucking puppet master, Pinocchio?

  Somebody up there hated me, as much or even more than Downing, but I knew I wasn’t going to find out who. It didn’t matter all that much. The DOJ was all-powerful. I was up against a dragon. I’d have to be extra careful now with my phone calls, email, faxes, and what I said to whom. I still had people who I thought were great friends working inside UBS, but could I trust them? The only people I felt I could completely count on were Doug and my best buddy from the State Street days, Rick James, but they weren’t in Geneva. As long as I stayed in Switzerland I’d be a lone wolf, keeping the hunters at bay.

  For a minute I thought about packing up, folding my tent, and taking off, just so the Swiss couldn’t put the shackles on me. But that thought was short-lived. I was now a marked man in both Europe and the States, so rather than run, I figured the best tactic would be a counterattack. I’d take that phony Ladjel Jafarli letter and shove it right up the DOJ’s ass. I suddenly decided that this time I wasn’t going to sneak around and rotate pay phones. If anyone was listening, which at that point I was sure they were, I wanted them to hear my defiance. I called Hector and Moran in Washington.

  “Listen up, gentlemen,” I said. “I’m going to send you a fax right from my home office.”

  “Okay, Brad.” Rick sounded curious. “But is that secure?”

  “Doesn’t matter. I’ve already been blown, and not in a good way.”

  I sent the fax off, and five minutes later they were both on the phone and breathless.

  “I can’t believe this,” said Paul. “Is this some kind of a prank?”

  “Only if I’m Batman and Kevin Downing’s the Joker.”

  “Are you absolutely sure, Brad,” said Rick, “that this couldn’t have been your friend Ladjel turning you in to UBS?”

  “Are you absolutely sure, Rick,” I said, “that your wife isn’t banging the pool boy?”

  “Pretty damn sure,” he said.

  “Same thing. Ladjel and I have been friends for ten years. He’s successful, wealthy, true blue, and has no reason to fuck me or kiss UBS’s ass. No motive. Besides, Ladjel never knew a thing about this, so it couldn’t have been him. This letter was a forgery.”

  “Fair enough,” Rick said. “What do you want us to do?”

  “I want you to take that letter, fax it right over to Kevin Downing, and say, ‘What the f
uck is this shit?’ He’s going to deny knowing anything about it, but at least he’ll know we’re on to him. And right after that, I want you to call the IRS and SEC and, most importantly, the Senate. I don’t care if you have to sell your firstborn, but get me that subpoena to testify. Are we clear?”

  “All right,” Paul sighed. “Fasten your seat belt.”

  “We’re already in a nosedive here,” I said. “Hurry up.”

  I hung up, and I admit I slammed the phone down pretty hard. I wanted them to get the message that I wasn’t thrilled with their choices so far and they’d better start playing hardball. Nice guys finish last. But things were moving too fast; no time to switch horses. I’d just have to keep whipping their flanks.

  Hector and Moran did as instructed, and Downing reacted as predicted. They faxed him the Jafarli letter, along with one of their own, demanding a full explanation. When he didn’t respond, they called him up, and he actually chortled like a schoolboy who’d been caught sneaking peeks up girls’ skirts at recess.

  “I have no idea who sent this,” Downing said. “But it’s clear that your client has numerous enemies, which doesn’t surprise me. He should take precautions.”

  Slimy bastard.

  Right after that, Haig Simonian published his scandalous article in the Financial Times. I sat out on my veranda, drinking espresso and grinning from ear to ear. According to Haig, some anonymous Swiss banker who called himself only “Tarantula” had contacted him and ripped apart Swiss banking, exposing years of its secrecy and corruption. Haig wrote that there was no way for him to confirm the morbid details, but his considerable experience in financial matters led him to believe that Tarantula was legit. By the next morning, all the other papers had picked it up and it was already causing some serious tremors in every bank from Zurich to Lugano.

  Meanwhile, my legal starlings did start burning up the phone lines, trying to get me immunity from the IRS and the SEC and a “friendly subpoena” from the Senate Permanent Subcommittee on Investigations. I figured with all that in play and with the DOJ’s pathetic ploy exposed, Downing and his cohorts would be less inclined to pull any more antics. But my faith in the palliative effects of logical thinking didn’t last long.

  A couple of days later, I got a call from James Wood, who was still grinding away at UBS, but had moved over to the South Africa desk as I’d warned him to do.

  “Bradley, listen to this one, mate.”

  “I’m listening, James.”

  “One of our friends in the Legal Department had one too many brandies last night. He blurted out that the US Department of Justice just sent something called a ‘target letter’ to UBS Legal, I think perhaps to Peter Kurer himself. Apparently the letter’s a warning to UBS, stating the bank’s now under formal criminal investigation by the American authorities!”

  “Well, that’s interesting,” I said in as offhand a manner as I could, since I’d bolted upright in my chair.

  “Bloody hell, Brad!” James exclaimed. “You were right!”

  “It’s been known to happen on occasion,” I said. “Just watch your ass, James.”

  “And you, yours,” James said.

  “Don’t worry.” I forced a laugh. “It’s my favorite piece of real estate.”

  But fuck. I was furious! Talk about showing your hand! It was almost like the DOJ was saying to the Swiss, “We’re going to have to look in your drawers. Better hide the porn!” Whatever their agenda was, I knew it had nothing to do with seeking justice for the American taxpayer.

  That was enough. I was done dealing with those DOJ clowns. I called up Hector and Moran, told them the latest, and said, “Fuck the DOJ. I’m not dealing with those assholes. I’m booking airline tickets, and you guys better have somewhere for me to go.”

  It was August 31, 2007, when Hector and Moran first made contact with the US Senate. I’d coached them on what to say and whom to approach, but I knew it wouldn’t be an easy row to hoe. Senator Carl Levin, the powerful chairman of the Senate Permanent Subcommittee on Investigations, was a lifelong Democrat and no friend of the Bush administration, which included the Department of Justice. I figured he’d find my offer to testify interesting, inasmuch as no one before me had ever proposed breaking the Swiss banks and telling exactly how they’d been defrauding American taxpayers for decades. But you couldn’t just drag a finger down the Capitol Hill phone directory and give Carl a call. My attorneys got some staffer on the line and said, “We’ve got an American client, who’s also a Swiss banker, and he’d like to blow the whistle on all the nefarious Swiss banking practices.” The response was a bit cool, something akin to “That’s nice. And I’ve got a bridge in Brooklyn that’s going up for sale real cheap.” Not so easy. It was going to take more than a few phone calls and a letter. But I stayed cool and told them to wait a couple of weeks, let it all sink in, and hit them up again.

  In mid-September I told my lawyers to “end-run” the DOJ and reach back out to the IRS, including two special agents assigned to the IRS Senate detail, John Reeves and John McDougal. I wanted the IRS to know that I was still willing to cooperate, but since the DOJ was about as friendly as a junkyard dog, we were going much higher. I had a two-tiered tactic in mind. The IRS had to be kept in the loop about the fact that I was going full steam ahead as a whistle-blower; plus I knew they were dying to hear the whole story, which I’d only tell if I had a subpoena to protect me from the Swiss. The IRS couldn’t grant it, but the Senate could.

  Right after that, I had Hector and Moran push the Senate’s doorbell again. This time something had changed, probably due to Haig Simonian’s article, which had been picked up by all the major financial papers and web sites. Once again my lawyers offered my detailed testimony, in person and at the committee’s convenience. But they also emphasized the caveat: “Our client must have a subpoena, otherwise he won’t be able to testify without risking his freedom. We’d appreciate such generous consideration in exchange for such groundbreaking revelations.” Basically they were saying, “Turn us down, and you’ll all have some ’splainin’ to do.”

  On October 9, Hector and Moran called me up in Geneva, and I could tell they were practically fist-bumping each other.

  “We got it, Brad! The Select Committee just issued you a subpoena!”

  “Great. Fax me a copy,” I said, though I was thinking, ’Bout fucking time. If you’d gone this route in the first place, I wouldn’t have that mad dog Downing yapping at my heels. But all I added was “I’ll start packing my bags.”

  Still, I was excited and at last optimistic. Somebody was finally going to listen to what I had to say, and it wouldn’t be a couple of bitter bureaucrats in some dead-end job. This was it, the Big Show, and this time I was going to take along every single piece of hard-hitting evidence I had. I also realized that my testimony before Levin’s committee could avalanche into further consequences over which I’d have no control, so I had no idea how long I’d be in the States. I paid my housekeeper three months in advance and told her to keep the plants alive.

  Then I headed for the airport, admittedly a bit edgy, since it was all too possible that the Swiss National Police might be waiting at the gate with a warrant. But hell, I’d always been something of a high roller, so I tossed the dice again.

  Washington, DC, in October is a whole lot better than the nation’s capital in June. It was cool and breezy and the leaves were turning, although in counterpoint to the weather, things for me were heating up. I set up the “bunker” at Doug’s place in Weymouth, just outside Boston, and I should have bought shares in Delta Airlines with the number of times I jetted back and forth. Doug, as I’ve mentioned before, is a meticulous and talented trial attorney, and as I ran down the details of everything I’d been doing, he started a dossier of evidence that later on would save my skin. He completely supported my whistle-blowing, but just like me, he was dismayed and pissed off at the way the Department of Justice was treating me like Lucky Luciano. Doug regarded his duties as an a
ttorney much like a physician adheres to the Hippocratic oath. He was stunned to discover that the DOJ viewed their vows as “flexible,” and eventually he’d grow to be even more furious than I was.

  Over the course of the next month, I worked with Hector and Moran to set the stage for my upcoming Senate testimony, as well as ensuring that my whistle-blowing status was rock solid with the IRS. On October 12 we had a sit-down in my attorneys’ office with a couple of IRS Legal and Compliance agents. I gave them more documents and testimony to garnish a clear picture of the massive scandal, and I told them I was about to tell everything to Carl Levin’s committee, and after that they’d get that whole shebang too. They were polite, solicitous, and very grateful. After all, Congress funds the IRS. The DOJ, on the other hand, always secretive and scandalous, was as useless as a screen door on a submarine.

  Throughout the rest of October we started shipping over preliminary evidentiary documents to the Senate. I wanted the committee to do some reading, even though I knew they wouldn’t understand the material without my “translation.” But if I just walked in there with a two-foot pile of papers, their heads would probably explode. At the same time, I had Hector and Moran keep on tugging at the DOJ, asking Downing for immunity and piecemealing him with more tidbits of evidence. I knew the fucker would keep on snubbing us, which he did; but it kept him off the scent of what I was really about to do: a Hail Mary pass right over his career. Then I had Rick and Paul contact the Securities and Exchange Commission, giving them a heads-up, too, on what was about to go down. With all these reach-outs, no one would be able to say later on that Birkenfeld was loath to cooperate.

  On November 6, a huge story broke on CBS News and was soon picked up by all the financials, including the Wall Street Journal. Down in Sao Paulo, Brazil, a UBS private banker based out of Zurich was suddenly arrested, along with nineteen Brazilians accused of scheming to help Brazilian companies evade taxes by laundering money through UBS and Credit Suisse, my old alma maters. The Brazilian police had raided forty-four different sites in a sweep dubbed “Operation Switzerland,” seizing $4 million in Brazilian and US cash, and estimating those companies were black-market-laundering $4.1 million per month and hiding it all in Swiss banks!

 

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