Conflict of Interest

‘The other thing was an entire missing directory. It was there on Wednesday night, gone by Sunday morning. Merlin could never bring himself to delete files – he might transfer them to the trash can, but he could never delete a single one of them, let alone an entire directory.’

She regarded Judith carefully. ‘I would say those two differences are quite significant.’

‘This missing directory—’ Judith began.

‘That’s where I need your help. You see, I don’t understand it. There are pages and pages of accounts. I have the feeling Merlin was on to something – something very big, involving a lot of money – and someone very powerful was determined to stop him. I know this must all sound like a huge conspiracy theory, but there are just too many things that don’t add up.’

‘All the financial information, do you know what company it’s about?’

‘There are several. They seem to be US-based – nearly all the figures are in dollars. But I noticed one name kept on coming up as a director, something like Jason Strauss.’

‘Jacob Strauss?’

‘Yes. That was it.’ She raised the glass of wine to her lips. ‘Who is he?’

Later that evening, Judith sat in her Earl’s Court bedroom, working at the dressing table which doubled up as her computer desk. Bottles of cosmetics and miscellaneous beauty accessories had been hastily shoved aside to make space for an ageing and cumbersome IBM, which she used now to scroll through the files that had mysteriously disappeared from Merlin’s computer. Somehow, Merlin had got hold of the trading figures of both Ultra-Sports and Trimnasium, the two privately owned companies Jacob Strauss had established years before he joined the board of Starwear. Having annotated the reports, he’d scanned them into his computer. Judith didn’t think she’d ever found companies’ financial accounts such compulsive reading – especially in light of the highlights and annotations Merlin had made while going through them.

She had never written about the Strauss brothers in the past, at least not in any detail. Like most London-based journalists, of the two brothers she knew quite a lot about Nathan, but nothing of Jacob. When she thought of Starwear the company, as opposed to the brand, she instantly conjured up an image of Nathan, the philanthropist, who had died in such tragic circumstances only a few weeks before. Of course, she knew that Nathan’s younger brother was Starwear’s golden boy in America, whose good looks and sports accomplishments made him an icon in the US. And she’d followed the news of Jacob’s appointment as the global CEO of Starwear after Nathan’s death. But that was the full extent of her knowledge.

Now though, moving the cursor down page after page of financial records, she did recall an editorial meeting at The Herald about a week ago. Alex Carter, sitting at the head of the table in a fug of cigar smoke, had brought up the subject of Jacob Strauss. Given his imminent arrival in London to head up Starwear, said Carter, The Herald should carry a profile on him. It was then he’d made the comment that had stuck in Judith’s mind: ‘I want something sensitive and supportive,’ he’d said. Sensitive and supportive. The phrase was so utterly out of character for Carter that it had firmly stuck in her mind. A hagiography about St Jacob had duly been pieced together from various PR briefings by – surprise, surprise – Alison MacLean. Judith hadn’t paid it much attention, but she did recall that Jacob’s pre-Starwear career had involved the hugely successful creation of two sports-related businesses – the businesses whose accounts she now found herself scanning.

But the figures set out here told a very different tale from that retailed in Alison MacLean’s profile. According to the accounts for Ultra-Sports, a chain of four upmarket sports equipment shops with outlets in Manhattan, Miami, Palm Springs and Beverly Hills, the profits made from all four stores had been almost entirely swallowed up by shrinkage problems in the Manhattan store. Hundreds of thousands of dollars’ worth of equipment had, it seemed, simply vanished without being paid for, from Ultra-Sports on Fifth Avenue. Merlin had made a note on the accounts: ‘Shrinkage – or theft?’ It wouldn’t have been the first time that shrinkage had been used as an explanation for the systematic rifling of the tills by a cash-hungry owner, thought Judith. Not that Jacob Strauss had any room for complaint in the income department. Merlin had also highlighted the section in the accounts which showed he’d drawn off a salary of $250,000 – well beyond what Ultra-Sports could support. At the end of the Ultra-Sports accounts, Merlin had summed up what it all meant in just two phrases: ‘Cash strapped. Zero capital.’ He’d also tapped in the name ‘William van Aardt – Partner’ and put a large question mark against it. Judith made a note to find out more about Mr van Aardt.

While the Ultra-Sports accounts told a very different tale from the success story Jacob Strauss claimed, the Trimnasium figures were even worse. A different file revealed that Trimnasium had never recouped the huge research and development costs incurred bringing the product to the market. In fact, its total income was barely enough to cover its rapidly rising advertising costs, as an increasingly desperate management tried to boost sales. It seemed that every lifestyle magazine and supplement, not to mention all the major health and fitness media in America, had carried Trimnasium advertisements for an intense period of two years. But the sales just weren’t there. Merlin had made some notes of a conversation he’d had with a J. P. Morgan colleague in New York. ‘Trimnasium product OK, but $$$’, the notes read. ‘Other products more functionality and less $$.’ Merlin’s own summary was equally concise: ‘No market intelligence prior to launch. Absence of strategy – product stillborn.’

Far from proving Jacob Strauss’s entrepreneurial genius, a phrase Alison MacLean had used in her ‘sensitive and supportive’ profile, Ultra-Sports and Trimnasium were textbook cases of greed and incompetence. Not that Alison MacLean was the only journalist guilty of swallowing Jacob Strauss’s public relations hook, line and sinker. Scanned into another file was US press coverage announcing the sale by Jacob Strauss of both Ultra-Sports and Trimnasium to a privately owned, Panama-based holding company called Sprintco. A photo-opportunity had evidently been set up on the slopes of Aspen, Colorado, showing Jacob, resplendent in that year’s skiing apparel, celebrating the company sales with bottles of champagne. Perhaps he was an entrepreneurial genius, Judith thought now, persuading anyone to buy the two companies from him. Ultra-Sports’s finances were precarious, and Trimnasium was a sinking ship – if due diligence had been carried out by any buyer, how in God’s name had Strauss pulled off the deal?

Merlin had circled the name Sprintco and put a large question mark beside it. The unknown identity of the buyer made the deal all the more suspect. The American press, oblivious to the real health of the two companies, had readily accepted Strauss’s explanation that the buyer, a wealthy individual trading under the name Sprintco, had made it a condition of the sale that his anonymity must be protected. So no names were mentioned by Strauss, and no figures either, although he hadn’t discouraged estimates between $100 million and $150 million for the two companies – figures which, in light of the accounts she had just scrutinised, Judith realised were pure fantasy.

She got up from her dressing table, lit a cigarette and paced about her bedroom, a dozen questions leaping to mind. Questions like: who was the buyer behind Sprintco? Was it just a shell company set up to enable Jacob to make an apparently successful exit from two companies that would otherwise have gone bust? Had Nathan known about the disastrous state of Jacob’s business affairs? If he had known, why did he appoint Jacob to such a senior position on the Starwear board?

There was no question that this material was explosive – especially in light of Jacob’s recent appointment as CEO of Starwear. Once she’d double-checked Merlin’s sources, Judith knew she had an exposé that could potentially out-scoop anything she had ever done before. It was more than just a business story – Denise was right. As Merlin would have known only too well, once the truth about Jacob’s early track record was revealed, it would have an instant and catastrophic effect on Starwear’s share price. The company would be blasted out of the blue-chip league and into mortal danger, ripe for takeover as long as Jacob remained in the top slot. Jacob’s own reputation and career would be in tatters. Criminal enquiries would be opened against him in the States. Having so recently become one of the most powerful players in the global corporate world, Jacob Strauss would face immediate public humiliation and financial ruin.

Realising just how high the stakes were, and how desperate Jacob Strauss must be, the idea of a fatal accident to conceal the truth didn’t seem so incredible. How better to silence the man who threatened to destroy you than by arranging an accident in a remote part of the country? The more outlandish, the better the distraction. Mulling it over apprehensively, Judith became convinced that Denise was right – Merlin had been murdered. She also realised that if she pursued this story she’d be putting herself in serious jeopardy. But how had they found out that Merlin was on the trail of Jacob Strauss? And what were the chances they’d discover she had picked up on it too?

As she paced her bedroom, she knew she faced a major decision. The safe option would be to let this story go; to accept that she’d be venturing into deep and treacherous water, which could easily overwhelm her. Not for one minute did she underestimate the danger she’d be putting herself in. Giving up an investigation was something she’d never yet done, something that smacked of defeatism. But was it worth risking her life to find out what lay behind the glossy image of Jacob Strauss?

Dr Ellen Kennedy had been in a state of unusual excitement ever since returning from her September walking tour of the Lake District, two days earlier. For as long as anyone could remember, Dr Kennedy had been a permanent feature of life at St John’s College, Oxford. Generations of students had come to share a fondness, not to mention a high regard, for their college’s most eminent economist. Though her bright eyes, apple cheeks and grey hair drawn back in a neat bun gave her the look of everyone’s favourite grandma, students soon learned never to underestimate her rapier-sharp intellect or widely broadcast intolerance of sloth. Following her return from the Cumbrian mountains, the diminutive figure of Dr Kennedy, in her sensible woollen check skirts and flat walking shoes, could be seen moving through the corridors of the college even more briskly than ever.

The cause of her newfound energy, apart from long walks in the bracing air, was an item of post she’d discovered among the large quantity accumulated during her fortnight away. It was a letter more replete with promise than any she had ever received before. Claude Bonning, whom she’d met several times in his capacity as President of Family First, had written inviting her to join the Executive Council of GlobeWatch, an organisation recently set up to promote good corporate citizenship by major multinational companies who operated throughout the world. Claude himself was the new organisation’s founding Chairman.

It wasn’t the invitation itself that intrigued Dr Kennedy. Every year she received more requests to join the bodies of worthy causes than she cared to think about – requests that she invariably declined, through pressure of work. It was, instead, the more tangible offer that accompanied the invitation.

‘Funded by a large and growing number of multinational companies,’ Claude Bonning had written, ‘GlobeWatch will not be just another talking shop, strong on rhetoric but offering no solutions. Instead, we intend to pursue a full programme of research, policy-formulation and publishing, independent of our sponsors. In particular, a sizeable budget has been allocated to research and policy formulation in the area of child labour, and we very much hope you will consider directing initiatives in this area.’

Child labour had become a subject very close to Dr Kennedy’s heart in the past few years. During her long career as an economist, issues faced by developing countries had increasingly preoccupied her – and more and more, the problem of child labour. Perhaps it was that she had found, at last, an outlet for her maternal instincts which had eluded expression through all her long years in academia. Perhaps it was that, as an educationalist, she felt strongly that children denied schooling were denied a future. But there was no doubt she felt more passionately about child labour than she had about any other issue during the course of an illustrious career – and she had probably done more to bring the issue to public attention than any other academic in Britain.

She had published papers on the subject and delivered lectures at conventions worldwide. She had visited regions in Pakistan and India, where some of the worst excesses occurred, with TV cameras, appearing in a documentary series on Channel 4. She had spoken out at legislative think-tanks in London and Brussels and Washington DC. But despite all she’d done, she was frequently overwhelmed by the knowledge of all that still needed to be done. And the perennial problem in doing it was always the same; there was never enough money. Never enough to monitor the extent of the problem in every country where children were exploited. Never enough to bring the issue fully to public attention. Lack of funding was something Dr Kennedy felt acutely – every month that went by consigned untold thousands of children to the abject misery of enslavement.

During her recent holiday, she’d had plenty of time to think. Charged as she was with new ideas, the arrival of Claude Bonning’s letter really couldn’t have been better timed. Although it begged a particular and intriguing question: just how sizeable was ‘a sizeable budget’? Excited though she was by the prospect of fresh research funding, on her first day back Dr Kennedy hardly had a moment to think about the letter, swept up in the usual demands of university life – student tutorials and final exam assessments, Fellows’ meetings and the usual college administration. She was only just beginning to get back to her usual routine on her second morning in college, when her telephone rang. Claude Bonning announced himself.

‘Ah, Mr Bonning! How good of you to ring. I received your letter when I got back from holiday yesterday.’ Sitting at her desk, she retrieved the letter from her in-tray. Glancing over it again, she noted it was dated a week before. ‘I’m sorry I haven’t had a chance to reply.’

For a few minutes they discussed the Family First conference at which they’d last met and where Dr Kennedy had made a keynote address, before Claude Bonning moved the conversation on to GlobeWatch, explaining the contents of his letter.

‘It certainly is very interesting,’ Dr Kennedy responded after hearing him out. Then, with typical acuity, she observed, ‘But it seems a little strange to me