Need You Now

A distinct uneasiness gripped me as my gaze swept the room. It was my first time in the Paradeplatz, and under different circumstances I might have been taken with the rich maroon carpeting and burnished walnut paneling. Adorning the longest mahogany table I’d ever seen was the emblazoned gold insignia of BOS: three golden cherubs that symbolized the bank’s core principles of discretion, security, and confidentiality. What I noticed most, however, was all the gray hair around that table. A second row of chairs lined the walls, like the back benches of Parliament-less gray hair, but plenty of salt and pepper. The financial advisors in this room were not like me. These were senior advisors, some from New York, and others I recognized only from press coverage of their accomplishments.

“Patrick?”

The voice was little more than a whisper, but I recognized the gravel in my team leader’s delivery. Jay Sussman was one of the salt-and-pepper advisors in the second row. I skulked my way over, like a theatergoer arriving halfway through the first act, and took the empty chair beside him.

“What are you doing here?” he asked under his breath.

A door opened on the opposite side of the conference room. In walked the managing director of BOS/America, Angela Decker, with whom I had been scheduled to meet. Or so I’d thought. With her-and my quick double take confirmed it-was the chief executive of the International Bank of Switzerland, Gerhardt Klaus.

“Is this the meeting for FAs?” I asked through my teeth.

“Yeah, the top one-hundred-producing FAs.”

BOS had more than eight thousand financial advisors in the United States. My invitation from Decker’s office had obviously come by mistake. “Should I leave?”

“Stay,” he said, smiling with his eyes. “Watching you squirm will keep me awake.”

The chief executive walked to the head of the table and remained standing as the managing director took a seat at his side. I’d never met Klaus, of course, but it was well known that he never allowed anyone to introduce him at internal bank gatherings. A vice president had sucked up so badly in Zurich last year that Klaus had forever banned all Willkommen speeches.

“Guten Morgen ,” he said. “And thank you for coming, especially those of you who are visiting from out of town.”

Klaus had a booming voice that required no microphone. Disciplined living and cross-country skiing kept him fit and looking younger than his years. He’d been born into a family of Zurich bankers at the height of World War II, at a time when his country couldn’t decide which side it was on. It has been said that certain Swiss banks had suffered no such indecision.

“Each of you was invited to this meeting because we wanted you to be the first to hear a major announcement, one that is vital to the future of the worldwide operations of BOS. Without further ado, I’m pleased to tell you that a final settlement agreement has been reached between the International Bank of Switzerland and the U.S. Department of Justice.”

A chorus of murmurs coursed through the room like a breeze through a wheat field, followed by sparse and nervous applause. Then silence.

“As you all know,” Klaus continued, “both the Swiss government and BOS officials have been engaged in discussions for several months with U.S. authorities. These discussions…”

Discussions . Talk about a fudge word. Justice had BOS by the short hairs. The same excesses and mismanagement that had rocked the largest Wall Street investment banks had forced BOS to write down $50 billion in subprime losses in the fall of 2008. The market was in free fall, the world economy was in shambles, and investors from New York to Hong Kong were in a state of panic. The oldest and largest Swiss bank had been on the verge of collapse when the government had come to the rescue with a bailout. At that precise moment, the Justice Department swooped in. With the treasury secretary and the New York Fed warning that the collapse of institutions “too big to fail” could unleash another Great Depression, someone at Justice had the presence of mind-nay, the stroke of genius-to realize that the time was ripe to make Swiss cheese of the secret Swiss banks. The DOJ officially demanded the names of “serious tax evaders.” When BOS balked, they arrested a top financial advisor who was silly enough to state publicly that he’d smuggled a diamond in a tube of toothpaste for a client. When BOS stalled again, they indicted the bank’s head of private wealth management. They threatened to indict the chairman himself. They demanded a “collateral consequences” report from BOS lawyers, which is typically the final step before the indictment of an entire company. Finally, BOS-still in a weakened state, despite the multibillion-dollar bailout-blinked. It turned over the names of 280 of the most serious tax avoiders. Poof. A century of Swiss bank secrecy went up in smoke, just like that. Justice had been hammering away for more names ever since.

Apparently not everyone who worked for the U.S. government was a dumbass. Yet Abe Cushman had gone unnoticed by law enforcement. Those Ponzi schemes sure are hard to sniff out, especially the ones that last for only two decades and involve a measly $60 billion.

Hmmm.

“As part of this settlement,” the chief executive continued, “we have agreed to release the names of four thousand additional clients over the coming year.”

“Four thousand?” my team leader whispered. “This is good news?”

I leaned closer. “Actually, the good news is that the bank is offering a free box of Depend to each of our clients.”

My boss snorted with laughter, a reflex. The chief executive stopped, clearly annoyed. His steely-blue-eyed glare silenced the room-and it nearly sent me running for my own box of adult diapers.

Klaus leaned forward, his palms resting on the polished wood tabletop as he spoke. “I want to underscore that the only names on this list are clients of our cross-border business. This settlement agreement respects the fact that the cross-border business of BOS consists only of wealth management services offered to American residents outside the United States, that it operates entirely out of Switzerland, and that it is completely separate from the BOS/America wealth management business. In other words, this settlement affects less than one percent of the bank’s total invested assets. To put an even finer point on it, the settlement does not affect our U.S.-based private wealth management clients.”

Yet , I wanted to say.

“Which brings me to even more important news,” said Klaus, “and to the real purpose of this meeting. With the DOJ settlement behind us, it’s time to look forward. Ladies and gentlemen, I am pleased to introduce the new head of private wealth management for BOS/America, a man who truly needs no introduction, Joe Barber.”

My supervisor and I exchanged glances. His expression matched my unspoken sentiment: Joe Barber? You must be joking.

Advisors and their clients had been walking away from BOS since the fifty-billion-dollar write-down of subprime losses. The recent threat of a criminal indictment over bank secrecy had pushed the total loss of assets for the year to over 200 billion Swiss francs. BOS was on the fast track to number two-not in the world, but in Switzerland . The much-anticipated announcement of a new head of private wealth for the United States was supposed to restore faith and calm everyone’s concerns. The chosen one, however, had earned his stripes at Saxton Silvers.

Barber entered the room, the picture of Wall Street confidence as a photographer captured him and the chief executive smiling and shaking hands.

It was Bear Stearns, Lehman Brothers, and Saxton Silvers-in that order-on the list of Wall Street investment banks that had gone the way of T. rex and the dodo bird, swept away by the financial tsunami of subprime lending and mortgage-backed securities. Barber had sown the seeds of disaster at Saxton Silvers before accepting a presidential appointment as