wanting to get in on it. A couple of days later the stock hit five dollars and thirty-five cents-and then the dump. All of the offshore companies, the blue companies, Cobalt, Blau, and Azul, started selling and the little people started buying heavy. Northstead’s boiler room couldn’t sell the stock fast enough.”
“Which stock?” Gage asked. “From the blue companies?” He didn’t wait for Alex Z to answer. “Couldn’t be. SatTek would’ve fronted a separate chunk to Kovalenko.”
Alex Z nodded. “And Northstead didn’t even pay SatTek for it until after they sold it off. They didn’t take any risk at all.”
Gage studied Alex Z’s chart. “What happened after the stock sold out?”
“SatTek filed its quarterly report with the SEC. Looked perfect. The company was booming like a son of a gun. Tons of money coming in, like from the Asian companies Mr. Burch set up. They paid in full and placed another ten million dollars in orders, each.”
Gage’s body stiffened. He stopped breathing. He could almost hear the cell door slam in Jack Burch’s face. He now grasped Peterson’s theory: Without Burch there couldn’t have been a SatTek fraud. He created the Chinese and Vietnamese companies, and they were the key to the entire scam.
Alex Z searched Gage’s face. “What is it, boss?”
Gage looked up. “Where’d the Asian companies Jack set up get the money to pay for the products?”
Alex Z shrugged again. “From sales, I guess.”
“Think. We know they didn’t do that. We found the devices SatTek sent to China piled in a basement, covered with a tarp. Same thing in Vietnam.”
Alex Z stared at the charts, as if the pattern would somehow emerge on its own. “But I don’t…”
Gage pushed himself to his feet. “The money to pay for the products came from the blue companies.”
Alex Z shook his head, almost a double-take. “What?”
“The money…to pay…for the products…came from the blue companies.”
Gage picked up a black marker and began charting.
“Look.”
Alex Z traced the lines with his forefinger. “But…” He locked his hands on top of his head and closed his eyes for a few seconds, then looked back at Gage. “You mean SatTek pretended to sell millions of dollars of products to the Asian customers to convince the SEC to let them issue stock…”
Gage held up a finger. “Step one.”
“Then used the blue companies to sell the stock…”
Gage held up a second finger. “Step two.”
“Then the blue companies wired the money to the Asian customers so they could pretend to pay SatTek for the products they had pretended to purchase?”
“Exactly.” Gage rotated his hand. “Step three was a pirouette. SatTek paid for its own products with the money it made from selling its own stock.”
Alex Z looked back at the flowchart, eyes wide, almost awestruck. “It’s the perfect crime.”
Gage sat down, then grabbed a pen and a legal pad from the conference table. There was a box missing from the chart.
“How many shares went offshore right after they went public?”
“At least eight million.”
Gage thought out loud as he wrote. “If the blue companies sold the stock for an average of five dollars a share…” He performed a quick multiplication on his pad. “That’s forty million dollars.”
“Right.”
“Even after the blue companies paid SatTek sixteen million dollars for the stock and sent ten million to China and Vietnam, they still had fourteen million left.”
Alex Z whistled. “That’s a whole lot of money.”
“And that was exactly the goal of the whole scheme-Matson and Granger have got to be behind all of the blue companies.”
Gage stood up and added to his flowchart.
“And that’s not the end of it, boss. A few months later, the SEC authorized SatTek to issue another twenty- five million shares, then another thirty after that.”
Gage looked back at the flowchart, his stomach in a knot. What if he was wrong and Faith was right? What if Burch’s rage really had turned into greed?
One thing he knew for certain was that when Peterson presented his own flowchart to the jury, the bottom box would read: Matson, Granger, and Burch.
CHAPTER 24
T he train is leaving the station,” William Peterson told defense attorney Sid Lavender. Peterson propped his legs on his desk, leaned his oversized ergonomic chair back to its limit, and locked his hands behind his head. “Sid, your client better get on board.”
“Come on, Billy-boy, I’ve been taking these cases to trial for twenty-seven years. No way you’ll convict Ed Granger, relying on Matson and Zink. Zink couldn’t investigate a plumbing leak. Why do you think he never got promoted?”
Lavender loved the game and loved to go to trial. He’d rather go to trial than have sex, eat prime rib, hit a hole in one, or win the lottery. In fact, trial was his lottery except the odds always were that he’d win. White hair, chubby face, playful smile, everybody’s favorite uncle. Juries adored him and prosecutors could never bring themselves to hate him.
Lavender unbuttoned his suit jacket, took a sip from his Starbucks latte, then grinned at Peterson.
“How do you spell impeachment? M-a-t-s-o-n,” Lavender said. “Granger’s got lots of stuff on Matson. Lots and lots. You’d be better off taking the case civil.”
Peterson slipped his feet off the desk.
“You’ve got to be kidding, Sid. Let Granger kick all the dirt he wants at Matson, they’ll both be covered in dust.”
“Who’s kidding who?”
“Whom.”
“Okay. Whom. You’ve got to prove that Granger knew what Matson was up to. It’s he said, he said. You got Granger’s signature on anything? He own any of those companies? You got his name on a single overseas wire transfer? Can you even trace any of the shares to him? No, no, and no. How many was that? No. He was just an elder statesman offering a little advice to a guy he thought made a good product. All he got were consulting fees. Not even a quarter mil. Trust me, he feels betrayed…No, heartbroken…” Lavender sighed and placed his hand on his chest. “That’s it, heartbroken and betrayed.”
Peterson waved him off. “Save it for your closing argument.”
“You don’t really have anything. At least anything solid. I know it and you know it.”
“Sid, Sid, Sid. I’m not giving you a peek at my case unless your guy wants to do a Queen for Day about what he knows.”
Lavender set his cup down on Peterson’s desk, then leaned forward, reaching out his hands, palms up.
“Hypothetically speaking-get that? Hy-po-thetically. Who’s left for him to give? You got Matson. Granger never even sat down with Burch.” Lavender drew back. “What? He’s supposed to roll down on a bookkeeper at SatTek? What’ll that earn him? Two days off a ten-year sentence? Four days off twenty?”
“I think you better have a heart-to-heart with your client,” Peterson said, tapping his middle finger on a file folder bearing Granger’s name. “This isn’t the first time he’s come up on the radar. As soon as he stops lying to himself, you’ll be knocking on my door. If he doesn’t come in, it’s dasvedanya, baby. I hear Lompoc in the fall is just lovely.”
“That’s the last word?”
“Yes.”
“Which one?” Sid grinned. “Lovely or dasvedanya?”
