Steve Martini - The Enemy Inside

Korff starts to nod. “That was what worried me, part of the reason I complained so much. Before all of this, Gruber was a small regional bank with local deposit holders, mostly individuals and small businesses. It had assets of a little more than half a billion francs. All of a sudden, in less than two years, we had accounts in excess of one hundred billion.”

Harry looks at me. I know what he is thinking. It’s time for me to start worrying about what he told me on the plane on the way over.

“Not all of these deposits were from Americans, you understand. Some came from Europe, Latin America. As I said, we had deposits from almost everywhere. Money from the larger Swiss banks was being moved to smaller banks where it wouldn’t be noticed. Banks without branches overseas where your IRS and Treasury would have less leverage. We even had diplomats from the United Nations with PEP accounts at the bank.” Korff looks at both of us. He starts to laugh. “These people were on the news at night complaining about corruption in the third world, telling poor countries they had to clean up their act if they wanted help from the IMF, the International Monetary Fund. And during the day they were making PEP deposits in cash, large amounts into their numbered accounts at Gruber.”

“Makes you wonder about human nature,” says Harry.

Not if I know my partner. Harry’s been convinced since shortly after escaping the womb that the angels of our better nature took flight the instant Adam had his ass tossed from Eden.

“You wouldn’t by any chance have any documents concerning any of this?” he asks.

“No, of course not. But the bank has them. They would have all of the names and the account numbers.”

“You said there were exceptions to the bank secrecy laws in cases where there was evidence of criminal wrongdoing, money laundering. If that’s the case,” I say, “what’s to prevent a foreign government or some private party from accessing the banks’ files on these accounts?”

“Ordinarily I would say you are right,” says Korff. “But not in this instance. You see, there was a kind of informal understanding between the Swiss government and the other countries involved. What you might call a ‘safe harbor.’ ”

“Go on.”

“If the money was moved, transferred from the large Swiss banks that had international branches, during the window of time that was agreed upon, the United States agreed not to pursue it. Other countries followed the American lead. They would make no inquiries and the Swiss government would not be asked to relax the rules of secrecy concerning any of the PEP accounts. Once they were transferred, they would be untouchable.”

“Why would they do such a thing?” I ask.

“Because no one wanted the information to be made public,” he says. “There were serious concerns that disclosure would threaten political stability in a number of countries, not the least of which was your own. There was also concern as to the effect on financial markets,” says Korff.

“He’s got a point,” says Harry. “How do you explain to the common folk who are grubbing for a living that half of their leaders are on the take?”

“Precisely,” says Korff. “It was a very big problem. But still there should have been other ways to deal with it. I became a thorn because I kept pointing that out. Because, you see, I had no choice. As the bank’s compliance officer, if I said nothing and suddenly the news came out as to what was happening, I would be the one who was responsible. Gruber’s president and his friends on the board would claim they knew nothing. So what else could I do? I papered their walls with my complaints. When it was over they fired me. So there you have it. How I became unemployed. Now, what is this job you are looking to fill?”

“Why didn’t you take the information to the media?” I ask.

“This is not the United States, my friend. If I said anything they would have had me in jail, charged under the bank secrecy statutes.”

“But the statutes didn’t apply because of the criminal acts,” I tell him.

“They do if the Swiss government says they do. And the banking industry in Switzerland is very powerful.”

“Let me see if I understand what you’re saying.” I lean over the table. “The bank has all the information on these PEP accounts, numbers as well as the identities of the clients holding those accounts?”

“That is correct.”

“But the bank can’t be forced to give up the information, even though there is clear evidence of money laundering and probable corruption, because they’re shielded by secrecy. Not because it’s covered by Swiss law, but because other governments have decided not to challenge the issue since their own politicians are involved?”

“There you have it. Now you understand,” he says. Korff takes another swig from the stein and swallows it.

“And a private party seeking this information, bringing suit from outside the country. .”

“Would have no chance at all,” he says. “Without support from their own government, Switzerland would simply refuse to cooperate. Secrecy is the first rule. The only reason it has been relaxed is because of outside pressure from other governments. Take that pressure away and we go back to the first rule.”

I shake my head. If he’s right, Harry and I have hit a stone wall. A long trip for nothing.

“Excuse me,” says Korff, “but I’m getting the sense that you’re not really here to offer me a job. Instead, you’re looking for information. Am I right?”

“Yeah,” says Harry. “But you have to admit that the beer in this place is pretty good.”

“I thought so.” The German’s happy expression collapses. “Yes. The beer was good. And I enjoyed the meal,” he says. “And it is good to get out of my son’s apartment, to give them some time alone. So for that I thank you. I have enjoyed the conversation. When you get to be my age, it is good to be listened to by people who, at least for the moment anyway, think you have something important to say.”

I am feeling like a heel.

“It is difficult to lose one’s job when you get old,” he says. “There are not a lot of opportunities.”

“I’m sorry that ours was a lie,” I tell him. “Sorry that we had to deceive you. If there had been an easier way we would have taken it.”

“I understand,” he says. “I’m not going to ask you why you’re doing what you’re doing. Looking at your faces, listening to your questions, I assume that your motives are proper and correct. For whatever reason you are doing this, I hope you get them.”

By “them” I am assuming he means the PEPs. That’s not our mission, but if they should happen to tumble along the way, neither Harry nor I would shed any tears.

“So do we,” says Harry.

“All of this, the money, the PEPs, the corruption, it troubled me greatly.” He uncouples his hand from the beer stein, looks down at the table for a moment. When he lifts his head there is a tear running down one cheek.

“It is difficult, very difficult to do the right thing, and to end up as I do. I had worked for Gruber for twenty-two years. I knew the original owners. Nice men. To watch and see other people do what these people have done. To see them prosper. And to watch as society cloaks them with protection. . ”

I reach across the table, grab one of his fat hands before he can say anything more. “I’m not going to lie to you again and tell you that I feel your pain,” I say. “But I do understand. We both understand,” I tell him. “You need not have any doubts. You did the right thing. I think you know that and so do we. And if your family is any judge of character, and my guess is that they are, they know it as well. Whatever these other people did, they have to live with it. Take it to the grave with them.”