Fraudulent Transfers Read online

  “After October?”

  “There was another request for ACH information at the end of November. I complied with that request and my December mortgage payment was made for me. For what it’s worth, I never heard anything at the Fed indicating that bad things were happening because of the information I was giving to Alvarado. In particular, I knew nothing about the counterfeit cashiers check fraud you mentioned. Nothing about that was shared with staff at my level at the bank. And money laundering of one kind or another is going on all the time in various ways and as far as I knew, there had been no escalation in money laundering activity because of anything I had done. The Financial Crimes Enforcement Network handles that stuff and keeps pretty much to itself.”

  “Did Padilla/Alvarado ever refer to an organization named Bounce?”

  “I remember him using that word once when he made one of his information requests. I asked him what he was talking about and he said something to the effect of ‘Never mind. That’s no concern of yours.’”

  “When do you expect the next request for information to be made?”

  “Next Monday, December 26. Alvarado told me he would be meeting me that morning at the ferry terminal and he would be asking me for FedWire information for a multi-step fund transfer coming up on December 28. Why do you ask?”

  “Because I have a plan that might help my clients and, based on your other bad choices at the moment, might help you. Listen, we’re almost back to the ferry terminal so let’s split up. Do you think we could meet tomorrow at noon at Union Square to continue this conversation?”

  “That should work. Because of Christmas, the bank will be closing at noon tomorrow and I usually go for a walk over the noon hour anyway and nobody seems to follow me. I’ll be in Union Square, on the west side, just across the street from the Sir Francis Drake Hotel, at 12:05. I don’t really have a choice here, do I.”

  “Let’s just say your other choices are all worse than the one I have in mind for you.”

  “Right. I’ll see you tomorrow—Ed.”

  For the next two minutes or so, all I heard were cries from seagulls and what I thought was the moaning siren of a sound buoy out in San Francisco Bay. Then Ed was back on the phone. “Jack. Still there?”

  “Yes,” I answered, now on my third glass of merlot. “Pretty amazing story. Do you believe Pollard?”

  “I do. I’ve had a suspicion since we first saw him at the ferry terminal with Padilla that he was being blackmailed or otherwise forced to cooperate with Padilla against his will. So this is coming together as I thought it might. I’m going to take the ferry back to San Francisco. I’ll patch you in again tomorrow when I have my next meeting with Pollard. Where are you going to be tomorrow at 1:00 p.m. your time?”

  “I’ll be at my office.”

  “OK, I’ll call you there. I’m signing off for tonight. I still have some thinking to do about what happens next. You might, however, check your calendar in the morning to see if you, dba Jonathan Swisher, could make a few days’ trip out of the country leaving next Tuesday, December 27. You should be able to get back home by the following Saturday or Sunday, December 31 or January 1. And check with Veronica to see if she can do the same. We’re going to need you both for this. Tell her she needs to get her hair cut short and change the color to blond. And, she’ll need a pair of dark frame glasses. Good night Jack.”

  Chapter 28

  Ed called fifteen minutes behind schedule, at 1:15 p.m. my time, on Friday. He said he just saw Pollard walking across Union Square to the meeting place he and Pollard had agreed to. He told me he would leave his phone on so I could again hear the conversation, and he reminded me to put my phone on mute.

  The first voice I heard was Pollard’s. “Hello--Ed. Sorry I’m late. I was worried that I was being followed, so I made some detours, including going in the front door and out the back door of one of the hotels on Market Street. I think we’re OK, but keep your eye out for someone who seems intent on watching us. Here, I brought you some popcorn to feed the seagulls and pigeons. They sometimes behave better when you feed them. I had a good night’s sleep last night, for the first time in weeks. Confessing my sins seems, at least in the short run, to be therapeutic, so thanks for that. What happens next?”

  “I need you to switch sides and start playing for my team. If what I have in mind works out, there may be some light at the end of your tunnel that otherwise wouldn’t be there. This is going to require you to not just give information to Padilla/Alvarado but also get information from him and give it to me.”

  “Such as?”

  “When you meet with him next Monday morning, tell him you will need to know from where and when the wire transfer he wants you to give him information about is going to originate, and the names of the U.S. banks it will pass through. And tell him you need to know where the first transfer out of the U.S. is going to end up. Based on what we know about money laundering operations in general—and that’s what we think we’re dealing with here--this most likely is going to be a bank somewhere in the Caribbean. Tell him you need to know the name of the person at that bank who will be in charge of the transfers into and out of the bank. These transfers will require assistance from a bank employee who is on the money launderer’s payroll. Otherwise, it couldn’t be done without generating a suspicious activity report inside the bank. Tell him without this information you can’t get him the log on names, PINs and passwords he needs from you. You can put some further technical spin on this to make it sound credible. Tell him if he can get you what you need, using the cell phone connection you have with him, by noon on Monday, you’ll deliver the information he wants at the ferry terminal at the end of the day. I’ll then need you to get to me on Monday afternoon as early as possible both the information Padilla/Alvarado provides to you and the information you will be providing to him. Here’s my cell phone number. Calls on this phone are encrypted and secure. I’ll be waiting for your call.”

  “I’ll give it a try. Padilla/Alvarado is a smart guy and he’s going to be suspicious as to why I’m asking for information from him that I’ve never asked for before.”

  “Well, you have until next Monday morning to come up with a good answer to that question. I’m sure you’re up to the challenge.”

  “Assuming this works, what’s next?”

  “I’ll tell you later, after we see what you can learn from Padilla. All I can say now is that, if my game plan succeeds and you have helped it succeed, things will go better for you than would otherwise be the case. As noted earlier, under the circumstances you have created for yourself, this is your best bad choice.”

  “OK. Thanks, I guess. I’ll call you at this cell phone number next Monday afternoon, regardless.”

  “Good luck. Merry Christmas.”

  “Right.”

  After that, for the next minute or so, all I heard coming from Ed’s phone was Union Square background noise—birds, tourists, street vendors, car horns, whistles from the doormen at the Sir Francis Drake Hotel hailing cabs, etc. Then Ed came back on the phone.

  “Jack, still there?”

  “Yes Ed. Go ahead.”

  “I’ll call you on Monday after I talk with Pollard. Did you check your calendar, and Veronica’s? Are you free to make a little trip to the Caribbean next week? It’s really nice down there this time of year, although I’m afraid you may not have much time for hanging out on the beach.”

  “We’re both able to get out of town starting early Tuesday morning and can be gone the rest of the week, through Sunday, if necessary. But Veronica isn’t happy about having to have short blond hair and glasses.”

  “Tell her it’s only temporary and she’ll look great as a blond. You already have a passport and drivers license for Jonathan Swisher. I’ll get you a Jonathan Swisher American Express card by FedEx on Monday. Veronica is going to be traveling as Swisher’s girlfriend, Sarah Hollister. I’ll get her a passport and other Sarah Hollister credentials by FedEx on Monday as well. Can
you email me a picture of Veronica, and her birthday, height, weight, and eye color?”

  “Sure, except the weight will have to be an estimate. And her birth year may be an approximation. But what’s going on here?”

  “That depends on what Pollard can learn from Padilla. I should be able to tell you more on Monday.”

  “And what am I supposed to be doing in the meantime?”

  “Your day job. You still have clients, don’t you?”

  “Not for long if we keep this up.”

  “Stay loose. I’ll call you on Monday. Merry Christmas.” And with that, Ed ended the call.

  I in turn called Veronica, told her what I could about Ed’s latest conversation with William Pollard and told her to be standing by for a trip to someplace in the Caribbean, leaving next Tuesday and not returning until the following weekend. She would now need to head back to San Francisco from Monterey Monday evening in order to be at SFO early in the day on Tuesday to catch a flight to a destination yet to be determined. And, between now and then, she would need to make an emergency salon appointment.

  “OK Jack, but if we’re going to the Caribbean, don’t expect me to put on a bikini. Those days are over.”

  “Nonsense Veronica. You’d look great in a bikini. But Ed says we’re not going to have much time for the beach. Whatever he has in mind for us is apparently going to keep us busy. Have a nice time in Monterey—one of my favorite places on the planet. I’ll call you on Sunday to see how your Christmas is going. But you can’t have your present until we get to wherever we’re going on Tuesday.”

  “You’ll tell me what it is though, right?”

  “No. Sorry. You’ll just have to wait.”

  There was a good reason for this since I’d had no time to think about Christmas and, at the moment, there was no such present.

  For the rest of Friday and into Saturday, I tried to do what Ed told me to do and catch up on client work. Thanks to Tomas Padilla and associates, there was a great deal of client work needing to be done that should already have been done. Clients are accustomed to lawyers not finishing their work on time and are generally tolerant of this defect in the legal profession, but I was now pushing the limits of tolerance. Early Friday afternoon, before digging into the work itself, I sat down with Stephanie and we did a triage—deciding which situations were most urgently in need of attention, which clients were complaining the loudest and threatening the most, which clients had found themselves in circumstances that could reasonably be described as hopeless, etc.

  By early afternoon on Saturday, I had made modest progress in my catch up effort, with the top of my desk again being visible. I therefore shut down the operation and headed out to find Veronica a Christmas present. I had initially thought I would buy her a nice eight foot six inch, medium flex, graphite-composite fly rod. But I finally decided that, since she’d only been fly fishing twice, made me take the fish off her line, was worried that fishing would dry out her hands, and didn’t like being cold and wet, maybe I should buy her a bright shiny object instead. Fortunately, a small jewelry store just down the street from my office was still open and had something I liked—a gold chain pendant having as the medallion a little ceramic starfish with a small diamond in the middle. I paid the jeweler (noting that the fly rod would have been cheaper) and asked him if he could put the pendant in a box and gift wrap it for me. He said he normally didn’t do gift wrapping but he agreed to make an exception in my case since he perceived, correctly, that I had no skills in this area. I also stopped by a pet supply store on my way home and bought Fletcher a chew toy (unlikely to last longer than twenty-four hours) and a box of his favorite dog treats.

  After arriving home and giving Fletcher one of his treats, I put on my wintertime jogging gear and went for a run up into the foothills to the west of my house. Even though the air temperature was only in the 20’s, there was no wind, the sky was bright Colorado blue and the sun, at 6,200 feet, made for a pleasant outdoor afternoon. I put in three miles before giving up and walking the last half mile back to my house.

  Christmas had ceased to be much of an event for me since, for many years now, I had had no family to share it with and Fletcher was largely indifferent to holidays. When I returned from my run, I hung an old wreath I still had on the front door, gave Fletcher some extra Greek yogurt with his dinner, popped a frozen pizza in the microwave for myself and opened a bottle of pinot noir from my special occasions collection. Fletcher and I watched Miracle on 34th Street for maybe the tenth time and called it a day.

  Christmas morning produced a cloudless sky and temperatures going into the 40’s. So, around 9:00 a.m., Fletcher and I headed out to Eleven Mile Canyon thinking we would have the South Platte River there to ourselves. This proved to be incorrect. Other fishermen, it seems, had similar thoughts and, as usual at this popular tail water, there was competition for the best trout hangouts. Fortunately, I found one of my favorite spots still vacant and I spent a pleasant two hours chasing after medium-to-small rainbows with microscopic flies intended to imitate the emergent life cycle stage of a particular species of mayfly that lives in this neck of the woods. I hooked up with and brought to net a half dozen fish, which I considered a good day’s fishing for late December. Fletcher was relegated to the back of my truck during this time, but he didn’t seem to care. Sleeping there was as good as sleeping anywhere else.

  We were back home by 2:00 p.m. I took a hot shower to warm up and then put in a call to RJ to wish him a merry Christmas. He was having a good day playing shuffleboard with some of his neighbors and sitting around the pool indulging in his favorite arthritis medicine—Jack Daniels and soda—and telling, and listening to, fish stories.

  I next called Veronica. She was back at her motel in Pacific Grove after a long, pleasant hike along the beach outside of Moss Landing. This is an area abutting the southeast side of Monterey Bay, to the north of the city of Monterey and to the south of Santa Cruz. It is home to a large population of sea otters, sea lions, brown pelicans and numerous other species of shore birds, and the beach, which goes on for miles, is wonderfully clean and never crowded. Veronica was planning to have a solo Christmas dinner at the Fishwife, a popular restaurant just up the street from Asilomar Beach on the west side of Pacific Grove, and just to the north of the glitzy Spanish Bay golf resort.

  “Jack, I wish we were here together,” she said. “This is such a beautiful part of the world.”

  “I agree, and we’ll definitely make that a part of next year’s plans. By the way, I have your Christmas present right here on the table. Too bad you’re not here to receive it.”

  “And you still won’t tell me what it is?

  “Nope. Sorry. This present requires in-person delivery, with the expectation that appreciation will then be expressed immediately while we are in the general vicinity of a bed. That’s why you’re going to have to wait until we get to wherever Ed is sending us on Tuesday.”

  “Well, your present should be delivered to you at your office tomorrow, with no such strings attached.”

  “And I don’t suppose you’re willing to tell me what it is.”

  “Not unless you tell me what my present is.”

  “Sorry. Nonnegotiable. You’ll just have to wait.”

  “Then so will you.”

  We talked a bit more about things she might want to see and do while in Monterey, her parents’ health and their plans for Christmas, and what her work schedule called for on Monday. We then speculated about what Ed had in store for us, decided we didn’t know and agreed we would talk on Monday as soon as Ed could tell us where we were going and what we were supposed to do when we got there.

  “Merry Christmas Jack. I miss you. I’ll see you on Tuesday—somewhere—as a short haired blond with glasses.”

  “Merry Christmas to you. I’ll call you tomorrow. You’ll look great as a blond, and you can take the glasses off as soon as you’re done being Sarah Hollister.”

  Chapter 29

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bsp; Ed called shortly after 2:00 p.m. my time on Monday. “Hi Jack. Pollard came through for us. The wire transfer we’re interested in is going to originate out of the checking account of a brokerage firm in Seattle first thing Wednesday morning. The originating bank will be Wells Fargo. The brokerage firm’s client is some corporation the brokerage firm thinks is a legitimate business, but in fact is just a front for money laundering by Bounce. This corporation probably sweeps up small—under $10,000—cash deposits through multiple other companies controlled by Bounce, some of which may conduct an actual business. The ultimate source of the cash is most likely criminal activity involving drugs, gambling, prostitution, human trafficking, arms sales and the like. This money, once it’s made it into the banking system without detection, then gets aggregated in the fronting corporation’s brokerage account. According to Padilla, the transfer this time around is going to be $22 million.”

  “What else did Pollard get from Padilla?”

  “The transfer will go from Wells Fargo in Seattle to a small privately owned bank in Houston, Lake Conroe Community Bank. The next stop will be the bank in Miami Padilla used for the counterfeit cashiers check fraud, South Florida Bank and Trust. Then, the transfer will go off shore to a bank in the Cayman Islands, Bayfield Bank, located in George Town on Grand Cayman Island. That bank has been in business for more than a century. It’s at that bank where someone on Bounce’s payroll will try to sneak the money out of the bank by a wire transfer to a country where Bounce’s customers--the criminals who generated the cash in the first place--can get their hands on it and use it to enjoy the good life.”