JUNE 3, 2008
MÁLAGA, SPAIN
ACCELERATING THROUGH THE CURVE of the onramp, he merged onto the highway giving the brand new Peugeot convertible more gas while changing lanes and passing slower traffic. Two young Spanish girls on a light blue Vespa, their long black hair flowing, smiled and waved as they passed. Bryan looked in the rear view mirror. The driver was scrunched down at the handlebars, her face hiding behind the tiny windshield, tan legs together at the knees. She was still smiling.
Gil lived in Málaga, on Spain’s Costa del Sol, coast of the sun, and less than an hour away from Marbella. Both coastal cities were considered to be retreats for the wealthy, and residence to an assortment of expatriates, and successful felons, some still on the lam.
Málaga was a port city in Andalucía, an autonomous region of Spain known for bull fighting, fairs, wine, and its Islamic history. Muslims had ruled this part of the Iberian peninsula for eight centuries, finally being forced out by a Catholic monarch the very year that Columbus discovered the new world. While they did rule however, the Muslims left a mark on the land they called Al-Andalus that was very visible to that day. Many conquerors had left remnants of their civilization in Spain, including the Romans, who left bridges and aqueducts, but it was the Muslims that gave the area not only its name, but influenced the very fabric of its culture more so than any other conqueror. Bryan commented on the appearance of the people. “One needs not search far to see the Moorish influence; just have a look around at the people.”
“I can see why Malik chose to be a Spaniard – he blended in perfectly,” Shannon said, recalling the man’s appearance.
Muslim dynasties began with the first conquest of the peninsula and the establishment of the Iberian Emirate in 750 AD, the rule of the Emir of Córdoba. Not quite two hundred years later, in 912, Rahman III, a Shi’ah of the Ummayad dynasty ascended to rule Al-Andalus at the age of twenty-two. In 929 he proclaimed himself the first Caliph of Córdoba, setting a precedent of a Caliphate in Spain lasting until 1031. The period saw the construction of the first magnificent castles and mosques, the most famous being la Mezguita de Córdoba a Moorish mosque built during the Caliphate.
“You’ve been here before, right?” Bryan asked, as he tried to get his bearings.
“Sure have, in school. I know the area very well, mi canta España,” she said. “It has such a deep and varied cultural history.”
As they rounded a turn near downtown, Shannon pointed out a few famous historical monuments, cultural influences present in Malaga, monuments to art and conquest. “Right over there you have Islamic culture stacked on top of Roman, and Spanish on top of that,” she said as they passed the Moorish fortification and a Roman amphitheater.
“Pretty amazing,” Bryan said as he tried to get a glimpse of one of the seven remaining Muslim citadels left in Spain.
“The Islamists know that these are here too. They believe they own them and may well have their sights set on Iberia again,” Shannon said.
“So you think that the cells that surfaced here in Spain have that in mind as their goal?” Bryan asked.
“It’s possible,” she said.
“But it’s also why it’s a good move on our part to have Gil close by, considering the terrorists seem to be moving through here routinely,” Bryan added.
“I’ve never met Gil before. How exactly did he end up on the Pegasus team?”
“Yeah of course, you’ve had only the pleasure to see his face on a video conference call. Well my dear Shannon, Gil’s probably the most important piece to our little team. By that, I mean when it comes to the financial matters – as in tracing the bad guys and their cash flow.” Bryan turned the radio down and continued; “I’ve known Gil since prep school.”
“Born in the States, right?”
“True blue. His father was a brilliant banker. He has two older sisters. One’s a doctor, the other writes children's books. A family of over achievers - especially Gil, who had academic scholarships thrown at him from many universities - ended up at Harvard though, majored in Math and Statistics.”
“You mean ‘Sadistics.’ That’s what we called it at IU.”
“Yeah, well he was a bit of a nerd then.”
“I thought you said he’s some sort of stud muffin.”
“I don’t believe you’d ever catch me referring to another guy using those words. I think I said he’d a reputation for chasing women.”
“Sorry,” She said laughing.
“Money has a way of changing people Shannon. Especially someone like Gil, so he turned himself into what you said.”
“So Gil’s money turned him into something hot, huh?”
“Can’t respond to that. How about not as much of a nerd.” Bryan said with a chuckle. “He was a skinny, six foot two non-athlete - thick glasses. But a chip off the old block - also brilliant - Stanford Business School by twenty.”
“That’s impressive.”
“Very, and while still a grad student he was already making big bucks in the financial markets. Actually had a weekly financial newsletter - charged three thousand dollars per subscription. He was already rich from family money and now richer still. Turned fifty thousand from his grandmother into over three million.”
“And that’s when he got into trouble?”
“Not quite. Every Wall Street firm wanted him. It was the early nineties and the stock markets took off like a rocket ship. The era saw huge new fortunes.”
“I wasn’t one of those.”
“Likewise.”
“Well, it didn’t last long, many evaporated by 2000,” Shannon said.
“How very true. But at the time it seemed everybody was playing stocks. Gil would say he sometimes knew to short a stock, when his bartender bragged about owning it.”
“You mentioned before that he made his money using the net. How?” Shannon asked.
“Right, the key was the net, and he’s a master. He gleaned information on company summaries, and financials from the net. He also used the net to place orders as well.”
“When I was little girl, I can remember my grandfather taking me on occasion to his stockbroker’s office in Bloomington. He’d sit for hours watching stock tickers in a room with other clients of the broker,” Shannon said.
“How nice,” he said with touch of sarcasm.
“I remember once, his broker placed an order for him. He wrote it down on a piece of paper and put it in a pneumatic tube. Like the drive-in at a bank,” Shannon said.
“Well by the nineties most investors just went online. It was slow, you know, they used dial-up. No trips to the broker’s office though. A trader like Gil had a T-1 for his Internet connection. Twenty-fives times faster than dial-up. Gil took advantage of inherent execution inefficiencies.”
“Meaning?” She asked.
“Volume bottlenecks of the early days of trading on the net. Similar to a log jam.”
“He did this with his own company?”
“Not initially. Top firms such as Morgan Stanley, JP Morgan, Goldman Sachs and such, all wanted him. Gil had other ideas - opting for a low-key atmosphere - a smaller, second tier trading firm. There he would have autonomy, and avoid scrutiny…“
Shannon jumped in and said, “The scrutiny from people like the feds, wondering about suspicious trading maybe. No doubt top firms had compliance departments that looked at everything. What sort of boiler room did he join?” She was beginning to wonder about the ethics of her Pegasus team member and Bryan’s good friend.
“Shannon, it wasn’t a boiler room per se. I mean they had real clients with legitimate services. Most accounts were large institutions - pension funds - money managers and the like.”
“He was busted ripping off retirement funds?”
“I wouldn’t say he was ripping them off. His clients did make large sums after all - we’ll just say, he bent the rules.”
“Bryan, I’m sure you heard the expression that ‘you can’t get just a little bit pregnant’,” Shannon pointed out.
Bryan explained how it worked. Gil would fill orders for his clients, who would spread around ‘big block’ orders consisting of thousands of shares at a time to trading houses just like his. His job was to execute the trades at the best prices possible. Most of the techies followed Microsoft’s lead and gravitated to the NASDAQ for their public listings, which was where the first real big Internet action was initiated.
“I’m familiar with that Bryan, they use a four letter symbol as opposed to the NYSE which use one, two, or three. And at the New York Stock Exchange they place their orders with an actual person standing at a post. I think they call them specialists,” Shannon said.
“How about that - your interests know no boundaries,” he said smiling.
“Funny, I’ve watched CNBC,” she replied with a little laugh.
“Anyway, all trades were made using the old auction format, but on NASDAQ the auction’s one hundred percent electronic. Gil calculated correctly that bottlenecks would occur. It completely opened a Pandora’s box. An inherent arbitrage by being ahead of the fund’s trades - it was very cunning.”
“I’m afraid you lost me a little on the arbitrage part. There was a disparage in price?” Shannon asked trying to follow the complicated nature of Gil’s stock trading.
“Gil made the arbitrage for himself, but because he had the price of the trades in advance. Obviously an advantage that no one else had – and that, as they say is the rub.”
“Now he was breaking the law. It’s like insider information.”
“Make that market manipulation sprinkled with fraud. Not a good mix to say the least. And he was co-mingling the clients accounts with bogus nominee accounts, making sure the winning trades went to him,” Bryan said.
“He just did it right there in the open?”
“I said he’s cunning - he waited until the end of the day and switched accounts in the confusion of the trading reconciliation, when they matched the buys and sells with client orders.”
“Why did it take so long to catch him?” Shannon asked, miffed at the possibility of such fraud.
“Well, they finally got their man, as they say. In only six years they netted more than two hundred million dollars. But he couldn’t stop. The trading only became bigger as financial markets moved into the new millennium.”
“Obviously regulators had their trades on the radar screen by then,” she said.
“Well, it was the stock they targeted; a mortally wounded company already hawked by regulators. Three large short trades brought the house of Gil down. His eight-year run was over.”
“Who bailed him out of that mess?”
“Before he was bailed out he had to be indicted, and it took months for the feds to build the case. Well after 9/11 before they had an indictment prepared. At the time I was still on assignment with the Navy and hadn’t jumped to a desk yet. I can tell you this - Gil’s father’s connected – very connected. I think the White House actually had a hand in the deal.”
“That was it? No jail time, no fines? The President or someone intervened and your friend just walked,” Shannon asked, perturbed at the light sentence.
“No, he paid a fine - twenty million dollars, but not a single day behind bars,” Bryan said, looking at Shannon, raising one eyebrow.
“Twenty million dollars – that’s it? I thought you said they made a couple hundred million?” She asked still dumbfounded at the favorable treatment Gil received.
“He did, and he kept a good portion, more than seventy million. The catch is that he’d be working for Uncle Sam in its war on terrorism for as long as they said so. They in turn, have loaned him to me. Of course at my request.”
“Of course, and you think that special favoritism is worth it I suppose?” Shannon asked, crossing her arms, somewhat irritated.
“I’d say so Shannon. Terrorism requires vast sums of capital to fuel its engines. Money for recruiting, training, housing, and weapons, just like any real army. But they’re not a real army, and they finance everything illegally. Pegasus, meaning me and you, needed the expertise of someone that knows how to hide illegal financial activity.”
“Seems like putting the fox in the hen house,” Shannon said as she looked out the window, shaking her head.
“It was the feds that came up with the idea. They set a precedent for assigning folks with particular skills in deceit to head up securities regulators years ago. You should remember that, you minored in history too, if I’m not mistaken,” Bryan said.
“Close, European History to be exact, but I’m familiar with the fact that Joseph P. Kennedy was the first head of the SEC.”
“As I said, who better to have enforcing rules than the best of the rule breakers? The practice worked then, why not now? He first got his feet wet by helping the DNI when he was at SOUTHCOM.”
“When Admiral Barnes busted Venezuela and Haiti,” she said.
“That’s right. Now Gil Bussman is our man.” Bryan was satisfied that he’d made a succinct point, the winning point.
“Well then, why not make Gil the next Chairman of the SEC?” Shannon countered, smiling.
“Touché.”
“How did he end up here in Spain? Seems he should be under house arrest.” Or at least wearing an ankle bracelet, she thought.
“Gil chose Málaga because he loves Spain, speaks Spanish and we were on board with his choice. Spain has an extradition treaty with the United States; besides, he’s right at home with the characters near by - the best crooks and money launderers in the world,” Bryan said.
“Marbella.”
“Exactly.”
“And an official employee of the Embassy, I suppose,” she said.
“With diplomatic immunity, and protection of our in-country FBI folks – with a little help from the company,” Bryan added.
Bryan and Shannon pulled up to a new ten story beach condominium. His friend had done well. The units there were priced from one million to fifteen million dollars for the penthouse, Gil’s penthouse.
“This is where he lives?” Shannon asked, checking her make-up in the visor mirror. She was irritated at the apparent lack of justice, and couldn’t believe one person could be so valuable that a blind eye would be turned to his past crimes. He should be in jail, she believed. She’d need to see some real evidence first hand to prove that Gil was so valuable. Bryan knew her irritation would probably fester more once they entered Gil’s home.
The elevator doors opened directly into the private vestibule of the penthouse. Greeted by Gil’s long-term housekeeper Inés, a short Spanish woman in her fifties, Bryan kissed her politely on both cheeks as was custom and introduced Shannon.
“¡Buenos días Inés. ¿Cómo estas?” Bryan said.
“Oh, estoy bien, gracias Señor Bryan. ¿Cómo está usted?” Inés responded.
“¡Muy bien!”
“Quiero presentarles Shannon Parker.”
“Encantada. Usted parece una modela. Usted es tan hermosa.” Inés told Shannon, informing her that she was beautiful enough to be a model.
“Buenas días Inés y gracias, pero no soy una modela,” Shannon said, explaining she wasn’t a model.
“Don’t feed her ego Inés,” Bryan said laughing.
“Oh no, no Mister Bryan. Por favor, come with me to Mister Gil.” She used "spanglish,” now commonplace on the Costa del Sol due to the large number of English speaking residents, mostly British expatriates.
They followed her through the foyer into a ten thousand square foot bachelor pad. Bryan looked around to see if there was some new statue or piece of artwork since his last visit. A grand piano, that’s new, he thought. He saw a set of bongo drums, also new, an empty wine bottle on top. Inés tidied up by grabbing the bottle as they passed. With twelve-foot ceilings, panoramic views from the maximum window area possible, and the only private swimming pool, the condo encompassed the building’s entire top floor and was the jewel of the Costa del Sol. Tastefully decorated in minimalist style, the furniture resembled displays in a design magazine rather than something to settle comfortably onto for a Sunday afternoon of leisure.
“Well I’ll have to give him credit for having fabulous taste,” Shannon whispered to Bryan, bewildered at the interior design.
Keeping a few steps behind Inés, they approached the entrance to the pool area. Two young models wearing micro bikinis were lying next to each other on teak chaise lounges. Both were talking on cell phones as they tanned under the hot Spanish sun.
“Just some of his playthings I take it?” Shannon asked sarcastically.
“They’re new to me,” Bryan said, curious about the women.
As they stepped outside onto the marble deck Gil came into sight. He was kneeling down at the edge of the infinity pool, casually chatting with another young model, whose topless body was silhouetted in the dark blue water as she held the side, slowly frog-kicking. Gil looked up and waved, a wide grin forming on his face. He stood up from his crouch, as the girl pushed off the side and made a few strokes toward the infinity’s edge. The motion of her body caused waves to cascade over the side, creating an illusion that the pool was a waterfall pouring into the cerulean blue sky.
Gil skipped a step and jogged over to Bryan and Shannon. Wearing just baggy swimming trunks and sandals, it was obvious that he’d been sticking to his daily workout regimen of weight training and kickboxing. He had the lean cut of a male model fifteen years younger. A far cry from the geek Bryan first met in their youth. Gil had also lost the glasses, having undergone Lasik surgery years ago.
“Hey Brother.” They shook with an arm wrestling grip, pulling each other close to bump shoulders and pat the other’s back.
“And this must be the indomitable Doctor Shannon Parker,” Gil remarked, smile now even wider.
“Nice to meet you Mister Bussmann,” Shannon said, extending her hand for a formal shake.
“The pleasure's all mine,” Gil replied, kissing her hand instead. Bryan winced at the sight, certain a friendship was not in the making.
“You’re looking a bit worked there Bryan. Need a Red Bull? Or something harder?” Gil asked, perpetual smile intact.
“Red Bull’s fine.”
“And for you my dear Shannon?”
“The quarto de baño first, and I’ll have some sparkling water, please.”
“Coming right up and Inés will take you to the servicio. Inés llévela al servicio para la piscina.”
Shannon turned and followed Inés as Gil reached into a refrigerator under the poolside bar, grabbed a Red Bull, a Perrier, and a bottle of Fiji water for himself.
“Bryan. My man. So this is our new profiler,” Gil commented.
“That would be her.”
“How about that Doctor Parker there? Great legs, huh. Where do you recruit – spinning classes?” Gil teased as he watched Shannon walk across the deck to the dressing room.
“Easy there pal, she’s damn good - and very smart,” Bryan said, as he also looked at her legs. The Stairmaster was paying off.
“She’s not really my type, way too vanilla. Ya doin her?”
“You’re pure comedy - and no,” Bryan said, as he sat down on a cushioned high chair at the bar, glancing over his shoulder at Gil’s poolside guests.
“Now those two are my types bro. Couple of wild and hot Russians - sticking around for the summer to keep me entertained, and both available I might add.” He handed Bryan the Red Bull, still grinning. Bryan could see that Gil hadn’t lost his reckless, wild nature. Some habits were too hard to break.
“You my friend, never cease to amaze. But we’ve got work to do,” Bryan said, wanting to get to the business of Pegasus.
“Roger that. But you need to live a little. Ask anytime, and you shall receive.” Gil raised his water bottle, tilting the cap toward the girls who both waived. Their phones still glued to their ears. Bryan made a mental note to check into the girls further.
Opening double doors using a biometric scanner and keypad, the three entered an office off the master bedroom with its own large balcony and a view that faced west along Spain’s famous coastline. Gil closed the doors and pushed a button on the wall. Roman blinds lowered from the ceiling, covering the thick hurricane-glass windows. As the ambient light of the tropical sun grew dimmer, it was replaced by an artificial one of plasma.
Gil sat down at his Knoll designer desk. As much known for its artistic design as it is for functionality, the expansive ”L” shaped mahogany surface area supported four, twenty-inch flat-panel monitors that lined up side-by-side directly in front of him, and an additional two screens and second keyboard to his right. Bryan recognized the latter as a Bloomberg, the system used by financial institutions all over the world. Jokingly, it was rumored to be able to even count the pocket change of CEOs.
“Doctor Parker, I’m sure that my buddy here has told you the sordid details of my sordid past,” Gil began.
“Google offers quite a bit of information as well,” Shannon said. “This is a nice witness protection program you’ve got,” she added sarcastically.
“That’s great, you’ve got a real sense of humor. Ready to tango?” Gil said with a mischievous grin.
“Go right ahead,“ she said.
“Now you’re about to find out why I’m here and not in jail.” Gil said as he moved the wireless mouse side to side and tapped the space bar on the keypad. The plasma screens came alive. His fingers then went into blurring overdrive, the click of each key being depressed blending into the next, becoming one constant whirl. Shannon, her mouth gaped open, watched in awe.
“Impressed, huh?” Gil said, seeing Shannon’s reaction. “I play the piano too.”
Shannon looked at Bryan, her mouth still open, understanding what he meant about being “blazing fast” on the keypad.
Within a matter of seconds he had all four screens displaying a series of financial transactions. He stopped the clatter of the keys for a moment and combed his dark hair back with the fingers of both his hands. Resuming his task, he moved the cursor to highlight an area on the far left screen and began a synopsis of his financial forensics.
“I used SWIFT to isolate over six thousand separate international wires of interest – wires that I’m interested in – ones I think are suspicious – and that’s out of hundreds of thousands during the seven banking days prior to the Memorial Massacre,” he said looking at Shannon, who was now leaning on the desk with both hands so as not to look over his shoulder.
Gil continued, “SWIFT – do you know what that stands for?
“The Society for Worldwide Interbank Telecommunications,” Shannon answered.
“That’s right. Headquartered in Brussels, the consortium-owned, banking co-op provides secure messaging services, including wires, for over eight thousand financial institutions worldwide. It’s been the primary tool for tracking down sources of terrorist financing,” Gil said.
Bryan contributed to the explanation, “The Society’s been cooperating with the Treasury Department, FBI, and the CIA since 9/11. In the past, the agencies could 'swiftly' track transactions from suspicious accounts at a broker-dealer in, perhaps Berlin – let’s say, to disbursement of the proceeds at an ATM in Bali. SWIFT’s existence was leaked to the press and its effectiveness compromised, leading to the creation of Gil’s program out of the Pegasus budget.”
“These are possible terrorist related transactions here?” Shannon asked.
“Yep and nope. What you’re looking at are relevant transactions based upon parameters that I input. If I only relied on SWIFT, we’d be hosed.” He swiveled his chair around to face Shannon, who was leaning against the desk, arms folded, her back to the Bloomberg. Her skirt now mid thigh, revealed the true definition of her legs, a momentary distraction for Gil, now having second thoughts about whether Shannon was his type or not.
Gil re-caged his brain, getting back to his lesson. “I trim the SWIFT data down to four hundred or so with Pegasus. It’s over a half a billion dollars from fifty-five accounts in the States and UK - then after bouncing around the planet a few times landed on just a few that I want to know more about.” He opened his bottle of Fiji and took three large swallows.
Gil looked back at Shannon and began to explain the complicated elements of pinning down a terrorist finance scheme.
“Bryan’s heard this all before Shannon, but ya see, tracking terrorist’s financing is kind of an art now, and involves a thorough knowledge of financial markets and banking nuances. And I’m the master,” he said with a laugh. “Especially since terrorists are being tipped off by the well intentioned, but naive media. They really don’t realize it’s at the expense of national security,” Gil said with his head slightly cocked toward Shannon. He then delved into his area of expertise. “Major league bucks freely flow between accounts worldwide virtually anytime fed wires from the States are permitted. The feds can hardly prohibit Morgan Stanley from accepting funds from a bank based in Athens or the Isle of Lucy - simultaneously, US regulators have little or no idea regarding the ownership of the assets held in correspondent accounts at those same institutions,” Gil said, also testing Shannon’s wit and sense of humor.
“Isle of Lucy? Cute,” Shannon said with a slight grin. “Who’s covering the accounts then? Is it up to the institutions and secondary jurisdictions?” She asked, shifting her weight against the desk.
“Oh you can sit up there if you want. I’m sure it’ll hold a buck twenty,” Gil said, moving the wireless keypad out of the way.
“Thanks.” She scooted up on the desk, crossing her legs, hands on one knee. Gil was sure he’d been wrong in his judgment now.
“Is it up to the institutions? That’s a good question, but not exactly, anti-money laundering efforts have focused on persuading, or should I say - pressuring low-regulation jurisdictions to improve their scrutiny of slacker institutions. But with only a moderate success rate, if any at all.”
“I can understand why, I mean, what’s in it for them, right?” She was familiar with money laundering, but curious about the international varieties of schemes.
“Well, the incentive for some places would be on the side of fewer restrictions. There’s always the greed factor though, and a few will be tempted by riches,” Gil said.
“Shannon, the ‘money talks and bullshit walks’ concept,” Bryan offered. “The bad guys pay bribes to avoid governmental oversight. Very typical in developing countries or corrupt governments,” Bryan said, thinking the two generally went hand in hand.
“Exacta-mundo brother. And to date any sanctions imposed by rich-countries, or the U.N. haven’t been large enough to really stop it, or make the rewards unappealing.” Gil took another swallow of his water.
“The areas I tend to scrutinize the most Shannon are ‘low regulation shell banks.’ The ones established at low costs in easy jurisdictions, like the Channel Islands, Caymans – places that typically have opaque ownership structures.”
“You mean where shareholders are designated either as a private corporation or organized through a trustee?” Shannon asked.
“You did your homework - good job. And you’re correct again, a shell bank transacts business in high-regulation, on-shore jurisdictions - they use correspondent accounts maintained with very recognized foreign banks. The correspondent bank – in Dubai or Karachi, let’s say – knows only that the account holder, or customer, is another bank. There is no way in hell that they can ever know the ultimate beneficiary of the funds in the accounts. That’s unless someone else tells them.”
“What you’re saying is that not just any moron can coordinate these sophisticated networks,” Shannon said setting her Perrier bottle on the desk.
“Well, unless you consider lawyers and bankers morons. They both play critical roles in structuring offshore accounts and shell corporations. I might also add that the bankers are critical in organizing the procedures that keeps the money movement outside the reach of government regulators,” Gil said.
Bryan and Shannon looked at each other and smiled. “Find the banker,” Bryan said to Shannon. “These types of schemes are brilliant for tax avoidance.”
“And also great blueprints for desperados wanting to move money around the world for more dangerous purposes, the ones we’re after,” Gil chimed in. “And don’t forget non-financial services.”
“What would that be? Gaming?” Shannon guessed correctly.
Gil responded by counting with his fingers, starting with the thumb, “Precisely. One - casinos and bookmakers generate huge amounts of cash that are used to disguise illicit funds transferred all over the place. Two - real estate deals can be used to transfer ownership of assets across borders. And three - shipments and sales of precious metals, or if you want, smuggling large amounts of cash - all are frequently used to evade the scrutiny from formal inter-bank transfers.”
“So how do you catch them? Look for foreign real estate developments and deals?” Shannon asked.
“Pretty good guess, but be patient girl. That’s why Uncle Sam did a very smart thing by not sending me to the pokey,” he said smiling at her. She returned the smile, warming to him.
Gil went on, “I look at terrorist financing just like I would any old money-laundering scheme, only in reverse. Instead of funneling the money down from a bunch of tiny payments starting somewhere to a few bad guys in another place…”
“Drugs for example,” Bryan interjected.
“Exactly – the drug model works just like that. But I look for fewer sources, located in under-regulated areas, and connected to a larger number of recipients. If you try that approach with the standard drug-financing scheme – you know, tracing the flow of funds backward from the receiver to the originator of the deposit, well you go nowhere. It does the drug enforcement absolutely no good at all.”
“Right, you’d just end up with some street dealer selling crack at a schoolyard,” Shannon said, understanding the drug model completely now.
Bryan jumped in as the picture became clearer. “But with terrorist assets, you work in reverse from Malik. When a terrorist or cell of terrorists is identified, then you can trace the transactions back up the chain to the mastermind.”
“That’s very accurate. Usually it results in finding assets of the financier. Those are the tactics I use, and that’s why SWIFT was so important. We definitely need the cooperation of foreign institutions. But now if you really want to screw regulators up, you throw in the Hawala system.”
“Yeah, the Asian system that doesn’t require promissory notes and bypasses government regulators.” Bryan remembered that Hawala was widely used in Pakistan and in the Middle East.
“So how were these accounts set up, and how did you track it?” Shannon asked, now believing that Gil was worth saving after all.
“That’s the clever part. Whoever set up the accounts that I’m looking at now did a great job, but they had some help from leaks in the media too. All they had to do was read a newspaper to know what not to do. We’d been looking one way, so they went the other. Everything was legal, by the book. And they used offshore trusts out of the Channel Islands, Bahamas, Caymans, Panama, and a few other favorite safe banking havens of mine.”
“Like for your nominee accounts,” Bryan said referring to Gil’s old days.
“Similar sure, only a little more clever though.”
“No way. I thought you were the best.” Bryan let out another dig about his buddy’s colorful past.
“Hardly on this scale, not even the crooks at Enron ever thought of this. What makes it so clever is they used offshore insurance policies as a conduit to funnel the money into U.S. brokerage accounts, and completely undetected. It doesn’t raise any red flags from the IRS or Homeland Security screeners. They also used the real estate scenario that you jumped on right away Shannon.”
“Not sure I follow you.” Gil had stepped into an area of money laundering that Shannon was unfamiliar with.
“These offshore policies can be titled under trusts of legitimate policy holders, naming employees of foreign real estate development companies as the insured and the trusts as the beneficiaries. They also can use the largest insurers and re-insurers in the world. All very kosher.” Gil moved the cursor to the far screen on his right.
“I don’t know the account holders yet, what I do know is this…” He moved the cursor to bring up a bright blue, digital outline of the Northern Hemisphere over the black background of the screen. The images were animated with bright yellow lines as he narrated.
“Here’s a series of large short-term treasuries purchased exactly two weeks ago. I’m confident that they were paid for by money borrowed from the policies. Don’t forget IRS fact number one - money borrowed from an insurance policy is not taxed, and therefore not really scrutinized unless a regulator or agent has a particular reason to do so. The money makes it onshore tax free, and minus any suspicion.” Bryan and Shannon both raised their eyebrows, fascinated.
Gil went on. “That’s pretty smart stuff alright. Money can end up in these accounts and not picked up by U.S. Patriot Act parameters. From there it can, in theory, be dispersed to a bunch of sociopaths waiting to put it to use for the things they do. It’s a premier money laundry operation that actually generates cash profits too.”
“I can’t wait to hear this one,” Bryan stated.
“Remember those offshore insurance policies? Well those policies are invested in a combination of U.S. treasuries and hedge funds that use leverage, plus they guarantee the principal. They can double up on their bets and the policies can never lose a dime. The funds remain intact, while at the same time they are financing global terrorism.”
“And you think you know the owner?” Shannon asked, uncrossing her legs, and folding her arms across her chest.
“Well I’ve used my program to pinpoint where the outbound wires ended up, and the source of the premium payments for the insurance policies. I don’t know the account number or name, but I know the bank.” Gil picked up the Bloomberg keypad. “Just scoot over a little Shannon.”
As the screen brightened, Bryan’s eyes focused on three words. Shannon read the words out loud “Bank of Dubai.”
“And you’re positive on this fact?” Bryan asked, knowing that he was soon going to be taking a trip to the Emirates.
“Five by nines my brother. The recipient of the wires from these U.S. brokerage accounts and source of the offshore premium payments are one in the same. Right here from the Bank of Dubai. Figure the odds, huh Bryan.” The sarcasm couldn’t have been more blatant. “That’s where the suspicious wires from the U.S. landed. I figure we crack that nut, and we’ll be able to put these particular terrorists out of business for quite awhile. The bad news is that I’m still working on figuring out who owns the accounts. Dubai’s banking laws won’t let me run through customer accounts. But I wouldn’t be surprised to find out that someone on the coast a little west of us isn’t involved also. I’ve got my Spanish banking contacts looking into it.”
“You mean Marbella,” Bryan said, agreeing that many Muslims had vacation homes and yachts there, and quite possibly one of the resident money-laundering specialists might have gotten their hands dirty.
“Exactly, I’ve found a couple of wires that bounced off Spanish banks.”
“What’s the good news then?” Bryan asked, putting a hand on his friend’s shoulder.
“Here’s the good news. No, actually make it great news. Thanks to Doctor Parker’s call earlier yesterday, I’ve got more for ya. A whole lot more.”
“Meaning?”
“Meaning that I traced the suicide bomber’s bank account straight to a wire from an account at the Bank of Dubai - probably not the same account that’s linked to the premium payments, but definitely linked to your suicide bomber. There’re numerous inbound wires from an account at the Bank of Dubai. Just look right here.” Gil highlighted the transactions on the Bloomberg. “I’ve got over ten in the two months prior to the bombings. A total of one hundred and twelve thousand dollars for Mister Eduardo Arias.”
“Who sent the wires?” Bryan asked Gil.
“He had two places that wires came in from. One was this account here.” Gil highlighted an entry on his screen.
Shannon read the entry “Banco de Santa Maria.”
“And the owner of the Madrid account would be?” Bryan asked open-ended.
“It would be Eduardo Arias, or Abdul-Malik – it’s confusing, these terrorists and their multiple aliases. But the name is Eduardo Arias on the account card in Spain. Here’s his address in Madrid.”
“Right, we’ve got that address. The Madrid office is checking that out as we speak. Who owns the other account?”
“This guy here. Some Russian. One Leonid Petrov.”
Bryan let out an affected laugh at the sound of the name he just heard. “That’s absolutely bizarre,” he said dismayed.
“You know this guy or something?” Gil asked, draining the last drop from of his Fiji bottle.
“We just came a complete full circle. Yeah, I know this guy.”
“Why’s it bizarre?” Shannon asked.
“Hmmm - how can I put this? Real piece of shit, this guy – Petrov’s committed war crimes as far back as the Soviet Afghan campaign, that’s twenty years ago, as well as atrocities in Chechnya. In fact, probably had a hand in murdering scores of civilians - all Muslims. He’s hated them ever since the Mujahideen got the best of the Soviets. Has been bent on revenge whenever he could exact it. Why, as far as he’s concerned, the only good Muslim’s a dead one.”
Gil and Shannon watched Bryan as he walked toward the draped window, pulling it to the side several inches. He glimpsed the rich blue of the midday Mediterranean Sea, the bright sunlight outlining his face. He was thinking about the Russian, finishing his thoughts out loud, “Petrov financing fanatical Islamic terrorists would be the equivalent of Nazis wiring funds to Jews. That’s why it’s bizarre.”
