“He had the weakness of his strength, too. He was a great hater. He didn’t forget things. I suppose you must have noticed that he had an etching of the north-west corner of Hyde Park hanging in his office. I am told that it went with him wherever he worked. Well, that sort of thing was typical, and in the end it brought him down. However, I am getting ahead of myself.
“When Lake came out of prison he changed his name – a reasonable enough action in a man who wished to live down his one criminal indiscretion – and he joined the army. He had an undistinguished career, but he got what he wanted – commissioned rank – and a few contacts. After the war he went into his CO’s firm, and soon made his mark. He was the type who gets on, and he had the additional advantage of knowing exactly where he was going. He changed firms, joining Moody and Van Bright in, I think, about 1926. They were a smaller business, and he was very soon in virtual control. When he made his money, during and after the 1931 financial crisis, he bought out the existing partners and put in young Philip Van Bright as his nominee. So that when he came to you as General Manager he retained – although of course you weren’t to know it – the control of that firm.”
“No wonder we did such a lot of business through them,” said Mr Atkinson drily.
“And they hold most of our securities,” squeaked Mr Chattell, appearing for a moment above the surface.
“Yes, we’re coming to that. But there’s one thing I should like to clear up first. When Lake joined you – did you ask him to take the post, or did he apply for it?”
“He applied for it,” said Sir George Burroughs. “But even if he hadn’t we should probably have asked him. There wasn’t another man of his standing or special knowledge available. We congratulated ourselves that we had made a very good bargain. Even now I can hardly see–”
“Don’t be silly, George,” said Lord Stallybrowe. “He joined us to ruin us. To ruin us. And he has ruined us.”
The solvent of personal danger was quickly reducing each of them to primary elements.
“Personally,” said Mr Atkinson coolly, “I’d welcome a few more details about this ‘ruining’. We’ve got very good auditors and the last balance sheet looked healthy enough to me.”
“Right,” said Lord Cedarbrook. “I hoped you’d say that, because it brings me to my next point. When Legate joined this corporation his objects, as I see them, were twofold. To get his own back on the world of big business, and to line his pockets in the process. It is difficult to weigh the Marxist against the rogue and say which object was the more important. Possibly they seemed to him equally so. For a number of years he worked steadily, to gain your confidence and to get the feel of his position. Also he had some preparations to make. He needed at least one confederate. If necessary, I think he would have installed him. But it wasn’t necessary. He found Brandison, whom he promoted to chief cashier, just the man for the job. Brandison was a drug addict–”
“Drugs,” moaned Sir Hubert Fosdick.
“Also there were certain outside agencies which had to be prepared. But when he was ready he wasted no time. About a year ago he set to work, on three distinct lines. First, on one pretext or another he lodged a good many of your soundest securities with Moody and Van Bright. An auditor, as you know, will accept a certificate from a reputable firm of brokers as to what stocks and shares they hold on behalf of a client, without actually bothering to see the share certificates. In your last three quarterly audits you will see, I fancy, that an increasing number of your most valuable securities are described as ‘lodged with Moody and Bright’. In effect, of course, that certification came not from Moody and Van Bright but from Legate. I think that a number of those securities may be regarded as non-existent. They have been quietly sold over a period of months. The total loss under that head alone may amount to something like three-quarters of a million pounds.”
No one seemed disposed to break the silence that ensued, so Lord Cedarbrook went on:
“Now the second matter. Recently, as you must have noticed, you have been placing your money in a number of rather speculative concerns. I will mention one – Syn-ol Company–”
“But, Cedarbrook,” – Mr Chattell seemed to have found his voice. “I was present at the Directors’ Meeting when the purchase was discussed. I resent the word ‘speculative’. We went into it very thoroughly. Why, I remember an article in Market News by their City Expert which gave the most convincing reasons–”
“Exactly,” said Lord Cedarbrook drily. “I suppose you know that Legate owned Market News. He probably contributed the article himself.” He went on: “There’s no evading the conclusion, gentlemen, that with his own brokers, his own financial press and your unbounded confidence in his judgement, he had you in blinkers. He had you hypnotized. I’m not blaming you – I’m just stating the fact. If you look now with a fresh and unbiased eye on some of your recent purchases – Syn-ol, West African Hostels, those Czechoslovakian Bonds, Factory Fitments – I’ll say more about them in a moment – Syndicat Universal – and a dozen others.”
“You’re right about the hypnotism,” said Mr Atkinson. “Recently, about nine months ago that is, we formed a finance sub-committee. Myself, Chattell and Sir George, with Legate as a permanent member. Any three of us to form a quorum. This committee approved all those purchases you have mentioned – and I must have sat on most of the committees. And yet the matters were so cleverly presented that I, for one, never questioned them.”
Lord Cedarbrook said: “If it’s any comfort to you, it was, I think, the formation of that committee which caused Legate his biggest headache – and in a way, it led to his discovery. You see, until very recently he tended to be a bit short of money. Until the last moment he couldn’t actually realize too many of the securities which Moody and Van Bright were holding. And I must emphasize again that any actual stealing of money from the Corporation was out of the question. Your internal security measures were too good. So what he did was, like all his tactics, very simple. He got you to authorize double and treble his salary and allowances. It wasn’t too difficult. As you know, he had a basic salary, and on top of that you paid him a commission on profits, on a sliding scale, with a bonus on certain big deals, and there was an arrangement by which he could draw lump sums against this money. I think that’s correct, isn’t it?”
“Yes,” said Mr Chattell, “but the cheques had to be signed by a director. Surely we should have noticed–”
“Not if he was careful, where he drew money twice, that the duplicate cheques were signed by different directors. That was where Brandison came in. He used to make out lists of cheques for your signature at each meeting. Three months ago, for example, you allowed Legate an advance of two thousand five hundred pounds against accrued bonus. Do you realize that you paid it him no less than three times? One cheque was signed by Mr Atkinson, one by Mr Chattell and one by Sir George Burroughs. Of course, that was an extreme example – in the earlier days he didn’t overreach himself to that extent. Besides, as I said, in the early days, when he might have been dealing with any two out of six directors it was easy. Latterly, with only three of you on the finance committee, it got more difficult.”
“Look here, Cedarbrook,” said Lord Stallybrowe, “is this true? Where did you hear it. It sounds far-fetched.”
“I heard most of it from Brandison this morning. But if you want a practical example of the cheque business let me tell you what happened in January. At the beginning of this year, as you may remember, Brandison was ill. Your second cashier was away, too. So the duty of preparing the list of cheques for your signature devolved on Mr Britten, one of your junior cashiers. Legate gave him the original list – and told him to have four or five copies made – one for each director and one or two spare. Britten was incurably careless. He typed out the copies himself, and – I think entirely by mistake – instead of leaving the cheques as they were, he put both Legate’s duplicate pay cheques – a small matter of a thousand pounds each on account of salary
– into your column, Sir George.”
Sir George Burroughs went very red and said, “Do you mean to say that I signed the same cheque twice over.”
“A different cheque, of course,” said Lord Cedarbrook, “but the same payee and the same amount. Legate was in the room when you did it. I suppose he would have explained it away somehow, if you had noticed it. But it must have given him a bad five minutes. But the remedy was worse than the malady. Because he got it into his head that Mr Britten had done this on purpose. There I think he was entirely wrong. I think it was just an example of Britten’s usual inefficiency and muddle-headedness. But the implications were alarming. If Britten had done it on purpose, then Britten knew what Legate was up to. Legate was too far committed by this time to draw back. I must say, he acted very quickly. First he had Britten sacked – not only to get him out of the way, but in order to create a convincing motive for suicide. Then, on Britten’s last night with the firm, he hired two men to follow him home, knock him on the head, and push him into the river – first searching his pockets and afterwards his house in order to make sure that he had left no documentary evidence behind. They were professional murderers, and they did their work in a very neat and professional way and Legate must have been very pleased with them. But unknown to him fate had already dealt another hand into the game.”
Lord Cedarbrook explained the part played by Paddy on that memorable night and finished by saying: “When Yeatman-Carter turned up a few days later and actually outlined to Legate the whole truth of the crime – with a few important exceptions – well, it must have been a ticklish moment. Carter, remember, had seen that very list, with Mr Chattell’s initials and Mr Atkinson’s and yours, Sir George. He remembered the first two – ABC and CBA. If he’d once realized what they signified the whole game would have been up.
“Legate improvised brilliantly. But at the end of the interview one of those silly things happened which confirm one’s belief in Providence. Carter said something uncomplimentary about communists and this casual remark touched Legate on the raw. He must have been mad enough in a general way with this young fellow who had blundered in and was threatening to upset his carefully stacked apple-cart. Here was the last straw. As soon as Carter had left, Legate sat down to think out how he could hurt him most effectively. And since Carter was a very junior member of a firm of accountants which depended on your goodwill for a lot of their work – well, it didn’t take him long to think out a stupid little piece of retaliation.
“And that was really the beginning of the end. First Britten, then Carter. Two unimportant people, who incurred Legate’s displeasure. And two of the proximate causes of his failure. The third was Bairsted. Some of you know that story, so I won’t waste your time with it now. Enough to say that as soon as we heard that Legate was on Henry Bairsted’s trail, we tracked back and we found Lake. And when we found Lake, we knew all about Legate. An inefficient cashier, a sacked accountant, a bankrupt industrialist. How shall the small confound the great.”
“Some time ago,” said Mr Atkinson, “you said that Legate’s object was to make money and to ruin us. Was there anything more to it than that?”
“At first,” said Lord Cedarbrook, “possibly not. Unfortunately for all concerned, the facts of the case became known to a certain Power – I needn’t elaborate the matter – a Power which has always thrived on the misfortunes of its neighbours – and for some reason is able to reap particular advantage if it can promote a really stinking financial scandal. You remember the Mont de Piété revelations which nearly brought down the French Government in the thirties – or more recently the Vatican currency-smuggling scandal which might have had a decisive effect on the Italian elections.”
“Admitted,” said Hewson-Collet, “that any financial embarrassment on our part is a cause of rejoicing to a certain Power whom we’re all too gentlemanly to mention by name. But was there, in fact, much in this for them. The only villain of the piece is Legate. We may be stung or we may be sunk – probably shall be. But it isn’t a criminal offence to be fooled – not yet.”
Lord Cedarbrook looked faintly surprised. “I’m afraid you haven’t got the idea at all,” he said. “Look it at this way. Suppose that we hadn’t got on to Legate’s game. Suppose he had wound up the business in a blaze of well-organized publicity – as he no doubt meant to. He’d have got rid of all your soundest holdings – and your shaky ones would have dropped through the floor. Your total loss would have run into millions. The public aren’t financial wizards, but that’s the sort of thing they can understand. The Stalagmite has lost two or three million pounds – somebody must have pocketed it. The suggestion, of course, is that you have done so. Then why haven’t you been prosecuted? Well, there’s a suggestion for that, too. Sir George has got a brother-in-law in the Cabinet and your cousin, Lord Stallybrowe, is a Parliamentary Under-secretary. We know it’s nonsense, of course, but that sort of thing’s meat and drink to the left wing. It was a perfectly lovely weapon. But, as I said, it was a weapon which needed the nicest timing in its use. And it is that timing which they have just failed to achieve. If Legate could have got clear away before you had any idea of what was happening you would have gone down without a struggle. As it is, you’ve got a chance.”
“There is a chance,” said Mr Atkinson slowly, “if you will hold your hand for a day or two. We can put an immediate distringas on any securities that Van Bright hasn’t actually sold. And where he has sold, we may be able to impugn the sale for lack of good faith. Then we shall need to float off some of those doubtful securities. It all depends on how long you can give us. If you upset the market now we shall get about a farthing in the pound.”
Lord Cedarbrook looked at Mr Curtis who said: “The Director has had to consider his duty to the public as well as to your shareholders and yourselves. But in the special circumstances he is prepared to suspend all action for forty-eight hours–”
“We shall have to get a move on,” said Mr Atkinson. “There’s only one thing to do. We shall have to form a private company to buy every single Stalagmite share which is offered for sale. When the news becomes public that ought to prevent a general run on our credit. I’d better see to the details–”
“Then we’d better have a test audit at once to find where we stand.”
“Mr Lloyd can take Legate’s place for the time being. If anyone wants to know where Legate is, say that he’s ill–”
“The police hunt will have to go on,” said Curtis. “We can’t guarantee that we shall be able to keep the public in the dark even for forty-eight hours. Something may get out.”
“Then the sooner we start the better,” said Mr Atkinson, who seemed quite cheerful now that there was action in prospect. “If you will leave the immediate steps to myself and Hewson-Collet I suggest we adjourn and meet again in two hours’ time.”
Lord Stallybrowe was last to go. He seemed to move in a daze. When he left the building he made instinctively for the modest café at which it was his custom to lunch on Board-meeting days.
In the middle of the road he changed his mind, and by vigorously waving, succeeded in stopping a taxi.
“Where to, sir,” said the taxi driver.
“The Ritz Hotel,” said Lord Stallybrowe.
It was the gesture of a lifetime.
17
Curtains
And so for forty-eight hours.
The directors, under the inspired leadership of Charles Bedell Atkinson (Sir Charles now, of course), wrought to save the Stalagmite. And though no one will ever know what it cost them personally, it is a matter of history that they did save it; and with it a small but definite part of England’s financial credit. And at that time she was living on her credit and on not much else.
The police spread their invisible net, the unostentatious net of the man-to-man enquiry, and thousands of uniformed policemen and thousands of plain-clothes detectives and even more thousands of Specials and railway police and dock police and custom
s operatives and airport officials received a Description and a Name.
And reports came flowing in, and were sifted and scrutinized and analysed – and about one in ten seemed promising enough to be followed up.
And the trouble taken was infinite, and the success achieved was nil.
Appropriately it was Lord Cedarbrook who made the final suggestion. He made it to Chief Inspector Hazlerigg on the morning of the second day of the great search.
They were talking about the character of the Russian – or Lord Cedarbrook was talking, for it was a subject about which he knew a great deal, and Hazlerigg was listening with one ear cocked for the telephone.
“They’re diffcult to grasp,” said His Lordship, “because it’s always difficult to understand an alliance between fire and ice. On the one hand they are devastatingly practical – they subordinate the means to the end to a degree which frightens a Western European. On that side of the medal, you know, Legate was pure Russian. I expect that’s why they understood him so well. And then, when you think you’ve understood that part of their character you strike this extraordinary vein of sentimentality. It takes a lot of different forms – a secret respect for convention, an exaggerated hero worship–”
Hazlerigg waited patiently. He guessed that some practical suggestion might eventually emerge from this theorizing. When it did come it surprised him.
“I should look for Vassilev,” said Lord Cedarbrook at last. “If you find Vassilev he’ll lead you to Legate.”
“Quite so. Where do we look?”
“It’s only a suggestion,” said His Lordship. “But why not start with Highgate? I can’t give you very convincing reasons, but such as they are, they seem to point there. First, when I met Vassilev he was in a tube train going in the direction of Highgate. Of course, the train was going to the centre of London as well, but I don’t think he’d be living there. And then again, he may have been bluffing. But that’s where the Russian character comes in. If he had been a German I should have guessed he lived in Edgware – the place the train was coming from. The German is by nature a double bluffer. The Russian is a treble bluffer. Therefore, since he was going towards Highgate, I think he lives in Highgate. And that fits in with his respect for convention, too. You’ll find that most prominent Russian anarchists have lived in Highgate or Hampstead. Peter Kropotkin, Felix Volkhovsky, Rankow. Karl Marx was buried in Highgate Cemetery.”
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