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Is there a David Mamet in the house?
Mar. 31st, 2008 02:04 pmI assume that many of you have seen The Spanish Prisoner, a David Mamet film starring Steve Martin (but don't let that put you off, it's a good movie).
When I read this morning of the $350m sting on Lehman Bros, it was of Mamet I first thought.
This is not an easy one to unravel, particularly since (as in Mamet), nothing seems to be as it seems, so to speak.
The dramatis personae are
(a) Investment bank Lehman Bros
(b) Japanese trading company Marudeni
(c) Shingo Yamaura and Takuro Nitahara, one-time contract employees of Marubeni
(d) The mysterious "Mr Sato" and the real Mr Sato.
(e) Asclepius, allegedly the "front" for Marubeni.
Last autumn, Lehman provided funds to a medical business, believing Marubeni to be the counterparty. The first repayment fees were due on February 29. No fees were forthcoming. Marubeni has effectively said "this is nothing to do with us, you were scammed". Lehman says that it was everything to do with Marubeni, and that they want their money.
Those are the bare bones. But how Lehman got scammed is pure theatre.
They met Yamaura and Nitahara -- senior leaders in Marubeni's Life Care Department, but allegedly only contract employees, and a man lehman Bros thought was Koichi Sato, the Department's general manager (and a salaried employee), at Marubeni's offices. The money was to finance a medical business. Lehman claims it was shown letters showing that Goldman Sachs had undertaken a similar transaction. Lehman provided the funds to Asclepius (which, by the by, filed for bankruptcy this month).
When no repayments were forthcoming on Feb 29, Lehman Bros heard that Yamaura and Nitahara had been sacked. They asked to meet Koichi Sato. The Koichi Sato they were introduced to was not the same man as the "Koichi Sato" who had met Lehman with Yamaura and Nitahara at Marubeni's offices the previous Autumn.
In effect, Lehman has been scammed out of $350m, which is a fair chunk of change. And no-one has the faintest idea where the money is. The whole thing was pure fraud.
This isn't rogue trader country -- it's a con that makes Ocean's Eleven look like peanuts. It is, I would say, the greatest straight theft from a bank in history. And all it took was a few forged documents, a single imposter, and a couple of guys who knew how the business worked. The money goes into Asclepius. It goes out of Asclepius into another shell company. It goes out of that shell company as payment for "medical supplies" (none of which really exist) to a raft of other front companies. If you move the money around fast enough, then by February 29 it could be anywhere and it would take years of auditing to track it down. By which time, of course, it will have been transferred elsewhere. The fact is, you can still move money faster than you can track it. Well, that's my take on what happened.
Beautiful.
When I read this morning of the $350m sting on Lehman Bros, it was of Mamet I first thought.
This is not an easy one to unravel, particularly since (as in Mamet), nothing seems to be as it seems, so to speak.
The dramatis personae are
(a) Investment bank Lehman Bros
(b) Japanese trading company Marudeni
(c) Shingo Yamaura and Takuro Nitahara, one-time contract employees of Marubeni
(d) The mysterious "Mr Sato" and the real Mr Sato.
(e) Asclepius, allegedly the "front" for Marubeni.
Last autumn, Lehman provided funds to a medical business, believing Marubeni to be the counterparty. The first repayment fees were due on February 29. No fees were forthcoming. Marubeni has effectively said "this is nothing to do with us, you were scammed". Lehman says that it was everything to do with Marubeni, and that they want their money.
Those are the bare bones. But how Lehman got scammed is pure theatre.
They met Yamaura and Nitahara -- senior leaders in Marubeni's Life Care Department, but allegedly only contract employees, and a man lehman Bros thought was Koichi Sato, the Department's general manager (and a salaried employee), at Marubeni's offices. The money was to finance a medical business. Lehman claims it was shown letters showing that Goldman Sachs had undertaken a similar transaction. Lehman provided the funds to Asclepius (which, by the by, filed for bankruptcy this month).
When no repayments were forthcoming on Feb 29, Lehman Bros heard that Yamaura and Nitahara had been sacked. They asked to meet Koichi Sato. The Koichi Sato they were introduced to was not the same man as the "Koichi Sato" who had met Lehman with Yamaura and Nitahara at Marubeni's offices the previous Autumn.
In effect, Lehman has been scammed out of $350m, which is a fair chunk of change. And no-one has the faintest idea where the money is. The whole thing was pure fraud.
This isn't rogue trader country -- it's a con that makes Ocean's Eleven look like peanuts. It is, I would say, the greatest straight theft from a bank in history. And all it took was a few forged documents, a single imposter, and a couple of guys who knew how the business worked. The money goes into Asclepius. It goes out of Asclepius into another shell company. It goes out of that shell company as payment for "medical supplies" (none of which really exist) to a raft of other front companies. If you move the money around fast enough, then by February 29 it could be anywhere and it would take years of auditing to track it down. By which time, of course, it will have been transferred elsewhere. The fact is, you can still move money faster than you can track it. Well, that's my take on what happened.
Beautiful.
