Chapter 7 - THE MAN WHO PROFITED IF THEY FAILED
The response from North Vale came through counsel.
Professional.
Careful.
Immediate.
The lender froze any further amendment to the facility and requested preservation of all relevant records.
They did not accuse anyone.
They did not forgive anyone.
They asked questions.
One question caught Claire’s attention.
Please identify all persons involved in the introduction, negotiation, documentation, or approval of the original financing.
Claire wrote:
Peter Bennett.
Evan Hale.
Then she stopped.
Who else?
Dana began tracing every fee paid at closing.
North Vale had received its lending fee.
An outside appraisal company had been paid.
A title company had been paid.
Then there was a $96,000 “transaction advisory fee.”
Recipient:
Hale Meridian Advisory LLC.
Claire stared at the name.
“Hale?”
Dana nodded.
“Registered two years ago.”
“Evan’s?”
“According to the Illinois business record, yes.”
Claire had never heard of it.
She had known Evan earned transaction fees.
She had never known he had been paid personally on Peter’s loan.
She called him.
He answered immediately.
“You’re digging through my company now?”
“You were paid ninety-six thousand dollars for arranging Peter’s loan.”
“That was disclosed.”
“To whom?”
“Peter.”
Claire looked through the glass door at her brother, who was in the next office.
“He says he thought your firm received it.”
“My firm couldn’t take that mandate.”
“Why?”
“Conflict rules.”
Claire went still.
“So you created your own company.”
“It’s legal to consult independently.”
“That’s not what I asked.”
Evan exhaled.
“Claire, you are turning a distressed financing into a conspiracy because our marriage imploded.”
“Our marriage imploded because my daughter found a forged document in your room.”
“You have no proof I forged anything.”
Again.
Not I didn’t.
No proof.
Claire felt the distinction settle.
“What is Meridian Asset Recovery SPV Three?”
Silence.
“Evan?”
“A special-purpose investment vehicle.”
“Yours?”
“Not mine.”
“Whose?”
“I’m not discussing investor information.”
She almost laughed.
“You were willing to marry me Saturday but investor confidentiality is where intimacy ends?”
“That vehicle has nothing to do with us.”
“It appears in the collateral package.”
Another pause.
This one longer.
“I have to go.”
He hung up.
Dana had heard enough from Claire’s side to understand.
“What are you thinking?”
Claire stared at the warehouse valuation.
The Elk Grove property had been bought by Richard Bennett twenty-two years earlier for $1.1 million.
Current appraised value:
$5.8 million.
The loan secured against it:
$2.4 million.
If the company defaulted and a distressed investor acquired the debt cheaply, the property could be enormously valuable.
Claire remembered something Evan had said months earlier over dinner.
The real money isn’t always in the company that succeeds. Sometimes it’s in buying the mistake somebody else can’t afford to survive.
At the time, Peter had laughed.
Their father had not.
May you like
Claire looked at Dana.
“I think Evan knew exactly what happened if Peter couldn’t repay.”
