Steve Martini - The Enemy Inside

“What was your job at the bank,” I ask, “at Gruber?”

“Oh. I was an officer at Gruber for twenty-two years. The last three I was what they call the anti-money-laundering compliance officer. A very important position,” he says. “It was my job to detect money laundering and to report it to the bank president and to the authorities.”

“I see. Was there much money laundering that went on?” I ask.

“Not in the beginning,” says Korff. “But toward the end before I retired, yes. It was very serious.”

“Really?”

He takes another drink and Harry fills the stein from the fresh pitcher.

“Yes. It was bad.”

“I’d be curious to know, how does a. . uh. . anti-money-laundering compliance officer discover such things?”

“Usually cash,” he says. “When someone brings large amounts of cash to deposit, that is usually a problem. Especially small denominations. It’s often drug money.”

“Are you familiar with the term PEPs?”

“You must be reading my mind,” he says. “That was the problem at Gruber. You know what it means? This PEPs?”

I nod. “Yes. Politicians, their families, people associated with them.”

“Well, when people like this, some PEP shows up at the bank and he or she has cash, sometimes suitcases full of it, you know you are in trouble. You cannot take that money, no matter how much it is.”

“And this happened at Gruber?” says Harry.

“Oh, yes.” He takes another drink. A little bit of it sloshes down onto his belly. “It was the reason I was fired. That and your government.”

“I don’t understand,” I tell him.

“Let me tell you.” He leans toward the center of the table like he wants to whisper some secret.

Harry and I join him halfway.

“The Americans wanted to go after their citizens for taxes. They pressured the big banks. Not the ones here,” he says. “The ones in Zurich and Geneva, Bern. The banks with overseas offices in the United States. After so many years of threats, the banks and the Swiss government finally said enough. They agreed to some plan to release information so that the American government could go after these people, American citizens with accounts in Switzerland. But then,” he says, “they had a problem. The PEPs.” He looks at us and wrinkles his forehead until the furry mice of brows above both eyes begin to dance.

“They had too many,” he says. “These people had accounts in banks all over Switzerland.”

I shoot Harry a glance.

“As you can imagine, this was embarrassing, hmm? They already told the press back in America that they were going to deal with these tax cheats. Now they find out there were powerful American politicians involved. And not just a few. So what to do?”

“What did they do?” says Harry.

“Consolidation,” says Korff. “They allowed the depositors, the PEPs, to move these accounts from the big banks where most of them were deposited to a handful of small banks in more remote areas. In the cantons. Because these transfers were inside Switzerland, they went unnoticed by the central banks in Europe and the United States. I don’t know whether they were informed or not. Probably not.

“What made it worse was that many of these transfers were made in cash. Large, large amounts of cash. Big bills. In the United States the largest denomination is the hundred-dollar bill. But in Switzerland we have the thousand-franc note, worth almost eleven hundred US dollars. The PEPs, the American PEPs, were showing up with multiple trunks, you know. .” He gestures extending his arms way out.

“Steamer trunks,” says Harry.

“Ya. That’s it. The steamer trunks, filled with thousand-franc notes. Truckloads of them.”

“Why not just wire the funds?” asks Harry.

“They did not want any record of the transaction other than the deposit at the bank.”

“You know, a friend of mine mentioned something about this.” I look at Harry. “You remember, what was his name? Ahh. . Graves.”

“Tory Graves,” says Harry.

“That’s it.”

“You know him?”

“Oh, yes.”

“He came to visit me,” says Korff.

“No, what a small world.”

“Yes. He was very interested in what was happening. In particular, where this money came from and how they would be able to use it.”

“Yes, we’d be interested in that as well,” says Harry. He pours more beer.

“Sure,” says Korff. “I will tell you.”

Cheng settled into the seat on the Chinese Army executive jet as it sped toward the Dabie Mountains. He was halfway along on his journey, the two-and-a-half-hour flight from Hong Kong back to Beijing.

As he looked down on the sprawling foothills he could see another dam under construction, one in a vast series of projects.

China had come a long way. Cheng may have been a godless bureaucrat, but he knew that his nation had been blessed more than once by Joss, the ancient Chinese god of good fortune. They had but one great adversary left in the world, America, and to Cheng’s thinking, based on every measure available to him, America was in decline.

While the United States was distracted with its Mideast adventures and its myopic focus on terrorism, China was busy investing in long-term infrastructure and industry, grabbing up critical global resources-oil, metals, and rare earth among others. Even the fabled iPhone and the Apple computer were assembled in China.

As America’s wars dragged on with no long-term political solution, voters grew weary. Cheng’s analysts in the Bureau predicted this result years before it actually occurred. They based their predictions on an earlier model, the war in Vietnam. The perceived American enemy was different, but the result was the same.

America, once in a war stance, had a tendency to perceive its enemy as a vast unified monolith. Cheng couldn’t be sure whether this was driven by military strategy or political ideology. But he and his analysts could see its effect. In Vietnam the monumental enemy was international communism, toppling dominoes that would consume the world if Vietnam was lost. In fact what was being waged was a war of nationalism by a country the size of California with an economy that was struggling to become third world.

Now the United States was gripped by an Islamic wave of jihad, hostility that transcended national boundaries, launched by a multitude of splintered subnational groups, many of them with different motives and grievances. There were so many of these that they defied identification. Even here, in the tribal chaos and ancient feuds of the desert, America had managed to inflate the balloon of a large unified enemy, an army of Islamic radicals. The violence was real, but the army, if it existed, was unified by only one thing-its hatred for the West, Europe and America. To Cheng and to China, this was a huge boon. They couldn’t have invented anything this beneficial if they had designed it themselves.

Cheng had to wonder if decades from now historians might look back and realize that what was actually in play were numerous wars of nationalism being waged across an entire region in the Middle East. Cheng suspected that this was the result of artificial boundaries drawn by the Western powers in the Hall of Mirrors at Versailles at the end of World War One. These boundaries had completely ignored ethnic, religious, and tribal factions. Instead, colonial spheres of influence were carved out of the desert for the Western powers who won the war so that they could plunder the oil reserves just then being discovered. In a place where tribal blood feuds were millennial in duration, this was like planting the seeds of poison to be harvested in the future.