Nothing Personal: A Novel of Wall Street (47 page)

Meanwhile, Reagan’s second term was producing big gains in the markets, and the Street was prospering. If anyone looked, the couple’s side trip to Liechtenstein looked like just a shortcut to Geneva, where they were going to visit Warren’s brother, who was doing a research fellowship, and spend a day with Frank and Karen, who were engaged and to be married in June. Warren and Sam spent a day reviewing the procedures that they had gone over with the lawyers Schiff had referred them to. Warren had told him the funds were part of an inheritance from Sam’s family in Germany and England. She did have extremely wealthy distant cousins in Frankfurt, so it seemed plausible if anyone questioned it, and the paper trail would lead nowhere. They had spent hours agonizing over the money. It hadn’t really been stolen, they rationalized. Warner had written down loans and sold them and bought high-income products to cover the losses. It had been possible it would all work out, until the tax law change clobbered real estate values, and interest rates dropped. If Warner failed, the main losers would be the Mexican family that owned 90 percent of the stock, but the run-up in its value had largely been based on false earnings anyway. Warren chose to believe the rumors that the Sanchez family was laundering money for Mexican drug cartels—it made what they had done seem almost victimless.

Sam had handled the transfer transactions perfectly. About half of the money was repatriated through the Caymans, necessary taxes were paid, and the other half had been transferred into the Faaringsbank account of a new firm, Flickflack AG, named after a horse she had owned as a kid, that was listed on the Luxembourg stock exchange with ownership through an anonymous Liechtenstein trust. Sam became the chairwoman and owned all the shares.

The company also endowed an academy in Jupiter, Florida, where Warren’s father offered scholarships for full room, board, schooling, and tennis and athletic training to two hundred underprivileged children from all over the United States. The operating budget consumed only a fraction of the income that the company was earning through the decisions being made by its chief investment adviser, David Schiff. Through a combination of good luck and Schiff’s excellent timing, he had moved the Trust into bonds as they rose, and then into stocks. Lately, Schiff had been enamored with discount retailing and computer-software companies for the long-term. They looked like good growth areas for the late eighties and early nineties, he’d explained, because they offered real products that everyone would need. By mid-1989 the Flickflack trust had assets of almost $300 million, even after paying some $50 million in federal taxes.

“Look,” Sam had told Schiff, “take all the risk you want. We want to be aggressive. We won’t cry if we lose money. Warren says you have a nose for underappreciated assets. We’ll trust it. You get five percent of everything you make, and you can still run your company.” Schiff agreed, but insisted he simply match all the investments he made for Emerson so there would be no conflict. He saw trouble coming, in 1990, and believed the early nineties would be a buying opportunity for depressed assets. The riskier purchases would be handled separately. He also donated most of his share to the environmental causes he favored and used some of the balance to fund activist shareholder lawsuits against abusive corporate practices, particularly in the insurance business.

The board of directors, of which Sam was the sole member, decided that the operating company needed to own residences in the areas where its likely clientele resided—Islesboro, Hobe Sound, Malibu, and Paris. With the exception of Whales End, they were comparably modest, charming, and likely excellent investments, all bought during the lows of the 1990/91 recession.

Just over 50 percent of all income in the trust and corporation was paid out to various charitable organizations, which Sam spent a lot of time interviewing and choosing. The balance of the trust income was available to Sam to spend or invest as she chose, as the trust did not seek nonprofit status and paid taxes in the United States.

With the pressure off, Warren didn’t mind the work at Weldon so much anymore. His rich wife gave him the liberty not to take any guff from Conover or anyone else, and he had a growing reputation as an honest salesman who wouldn’t recommend trades to clients just to earn a big commission or enjoy the adrenaline rush. As a result, his business grew quickly, and he became the top producer at Weldon. After long discussions with Schiff and some of his analysts, Warren diligently guided his accounts to areas of the bond markets where the returns more than balanced the risks. He advised them away from the exotic, structured products that the finance guys kept devising. As Goering put it, “If you’re playing Hide the Salami and you don’t know where the salami is, you shouldn’t bend over!” Some of Warren’s clients didn’t care—they were after big returns—and he soon released them to other salesmen. He took a lot of vacations, but he was allowed the latitude. He planned to stay at Weldon until he and Sam had kids, then find something that would allow him to spend as much time with them as his dad had with him. He had been hitting again regularly with his pal Neal, and his game was sharp again.

In the meantime, Sam had spent her free time refreshing her college major in art history, after dropping the pre-med idea despite getting nothing but As, and Warren had brought his mom in to work with them, making the operating company, called Gordian Fine Arts, a viable enterprise. She and Sam became advisers to several corporations in managing their art collections, and consultants to a growing group of collectors who were knocked out by the two women’s combination of looks, brains, scholarly knowledge, and nose for a deal. Chas Harper had married a beautiful private banker at the Bessemer Trust who had helped him manage his family’s money, and Nicole had been thrilled to refer dozens of their clients to Gordian rather than the usual art dealers and brokers, who could hardly be trusted.

One such assignment had taken Sam to Chicago, where she helped a major client acquire a $15 million Winslow Homer oil painting, then convinced him to bequeath it in his will to the National Gallery in Washington from his estate. She waived her commission in favor of a deductible donation paid directly to the Florida Academy and caught a flight to LaGuardia, and from there, a commuter plane to Camden, Maine.

The air had been smooth, and the Whaler met her at the dock for the cruise across the harbor to the house, where Warren was waiting. She took the pair of sunglasses Jimmy offered her when she climbed on board. It had been a long trip, but a good one. The boat powered out into the channel, the sun low on the horizon and the lights coming on in the waterfront shops and the large houses, reflected in the almost-black water, across the bay. The breeze was soft in her hair, and she settled deep into a cushion, looking forward to a warm, comfortable ride home.

ACKNOWLEDGMENTS

A work of fiction is no different than a good joke—there is an element of the truth in it that makes you laugh, or if poorly told, uncomfortable. In that regard, the truth is that I could never have written this book without the love of my father, who encouraged me to write later in life, because he wanted his son to be prosperous and happy, and my mother and brother who allowed me to grow up, knowing I was cared for. And, of course, my wife, who has made my adult life the envy of any man—not only is she beautiful, loving, and brilliant, but also a professional juggernaut who has never once settled for less than being the best at anything she does, pulling me along with her.

Also important are the panoply of miscreants and clowns (at least one of them an
actual
clown) who taught me that neither intellect, morals, nor taste were required to succeed in finance, so that even so lucrative a failure as my own might not reflect on my character. But there were also those rare dedicated and decent people who worked with me, and made what success I had not just possible but occasionally fun. Without them I wouldn’t have lasted a month. Sharing every day since with my wonderful children and incredible wife, and a small group of special, caring friends, was a treasure I hope someday to deserve.

Finally, my heartfelt thanks to the editors I have worked with in my brief career as a writer—Richard Story, Deborah Frank, Katie Gilligan, and Melanie Fried there to greet me when I returned from the yawning abyss of a blank page with a sheaf of disfigured paper, and the burning desire to do it again. My gratitude as well, to the remarkable Thomas Dunne who chose to invest his time, money, and reputation in me. I hope his faith is rewarded.

Mike Offit, New York 2014

ABOUT THE AUTHOR

MIKE OFFIT began a twenty-year Wall Street career after graduating from Brown University, abandoning advertising, and earning an MBA from Columbia University. He rose to become a senior trader at Goldman Sachs, and to head the mortgage and asset-backed securities trading desks at First Boston, Prudential, and finally at Deutsche Bank, where, as managing director, he built and ran the Street’s leading commercial real estate finance business. After retiring, he returned to writing, becoming a columnist and contributing editor at the luxury lifestyle bible
Departures
magazine. He lives in New York City and Bedford, New York, with his wife and their two children.

This is a work of fiction. All of the characters, organizations, and events portrayed in this novel are either products of the author’s imagination or are used fictitiously.

THOMAS DUNNE BOOKS.

An imprint of St. Martin’s Press.

NOTHING PERSONAL.
Copyright © 2014 by Mike Offit. All rights reserved. For information, address St. Martin’s Press, 175 Fifth Avenue, New York, N.Y. 10010.

www.thomasdunnebooks.com

www.stmartins.com

Cover designed by James Iacobelli.

e-ISBN 9781250035417

First Edition: February 2014