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Show Her The Money
By Stephanie Feagan
Harlequin Enterprises, Ltd.Copyright © 2005 Harlequin Enterprises, Ltd.
All right reserved.
Chapter OneSitting in front of the senate finance committee was like sprinting down Dallas Central Expressway, naked. If I didn't get run over and killed, I was bound to become the butt of everyone's joke first thing in the morning when the newspapers came out.
Either way, I'd rather get a root canal, have lunch with Aunt Dru, who could bore God into a premature Armageddon or remarry my lying, cheating mongrel of an ex-husband than face a row of senators bent on ferreting out the truth behind one of the worst accounting hoodwink jobs in history. Never mind that they got the first scent of blood from me. Less than a month ago, I thought I could set things straight, Marvel Energy would get their hand slapped and all would be well. How was I to know that what I discovered was only the tip of the iceberg?
I'd finished giving my prepared statement, and now it was time to run through the rack line with all those fun and happy senators who vaguely reminded me of a movie I once saw about the Salem witch trials.
"Ms. Pearl, I'd like some clarification on a few points."
Eyeing Senator Santorelli, a romantic-looking Italian with perfect hair, I nodded.
"What was your position within the accounting firm before you were dismissed?"
"I was promoted to senior manager last December, with the understanding I was being groomed to make partner within three years. This was my first year to head the Marvel Energy audit. I reported directly to Lowell Jaworski, the partner in charge of the firm's Dallas-based energy and petroleum clients."
"When you initially discovered the irregularities in Marvel's accounting methods, were you aware how deeply your own firm was involved?"
"I had no idea." That all came later. It broke my heart to discover the firm where I'd worked for over eight years was rotten at the core. But I didn't say that. I was pretty sure the finance committee could care less about my heart.
"What sort of discrepancies, in particular, did you find while working on the Marvel audit?"
Oh boy. This was the fun part. "Based on the dollar amount of oil reserves Marvel claims to hold, they own close to a sixteenth of the world's supply of petroleum. Marvel is a large company, sir, but not that large. My staff was only able to track down a fraction of their claim. Marvel has less than sixty million dollars of debt on the balance sheet, but I believe they owe various banks upwards of four hundred million. All of this debt was carried off the books, within a maze of partnerships and offshore trusts. As I dug deeper, I found out the company overstated their quarterly income for the past five quarters by almost twenty million."
"When you asked about these discrepancies, what was Mr. Jaworski's reaction?"
I cleared my throat and shot a glance at my hired gun attorney, Mr. Dryer. He nodded slightly, indicating I should go ahead. Returning my gaze to Santorelli, I caught an odd look on his face, one I couldn't decipher. "Mr. Jaworski told me my chances of making partner would fall to zilch if I didn't back off and leave it alone."
Santorelli paged through the copies of documents I'd provided to the committee, then looked at me with that weird look again. He almost looked like he wanted to smile. There was a bit of a twinkle in his dark eyes. Or maybe it was just the awful fluorescent light in the hearing room. At any rate, I had the sense he found all of this amusing in some way, and that pissed me off. After becoming a CPA, landing a job at the most prestigious firm in the universe, then working ungodly hours, week after week, year after year, all so I could make it to the top, I was now on unemployment. And Santorelli thought this was funny? I couldn't believe it. Maybe he just had that kind of face that always looks like it wants to smile.
"Ms. Pearl," he began in a solemn voice that belied his expression, "I see workpapers and documents here, along with the preliminary findings of the Securities and Exchange Commission investigation, that go a long way toward backing up your claim that Marvel grossly understated debt and overstated assets, but nothing in here gives us any proof that the irregularities weren't the result of error, or miscommunication, or negligence. You say the Marvel execs and the partners of your firm knowingly hoodwinked investors, that all the mis-statements were on purpose, but we can't begin investigating anyone unless we have some sort of evidence. All we can do with these documents is allow the SEC to file suit against Marvel and the firm for what amounts to setting up a maze of companies so complicated, it would take Einstein a year to figure it out. It's no wonder there are so many mistakes."
The sole woman on the committee, Barbara Clemmons from New Hampshire, piped up then. "Isn't it true that you approached the SEC after you were let go from your position at the firm?"
Again, I glanced at Mr. Dryer. He leaned over and whispered, "Tell the truth. They're going to try and say you did all of this for revenge, and without the memos, it doesn't look good. Just do the best you can."
Do the best I could? Oh, Lord. Turning back to face the row of senators, I said, "Mr. Jaworski told me, if I was determined to take my suspicions to the SEC, he'd fire me. In light of what I found, I didn't see I had any choice."
"If you're so certain this was a conspiracy, where's the evidence?"
Time for some major ass-covering. I mentally slipped into my iron underwear. "The Marvel executives sold every share of Marvel stock they were legally allowed to sell the day I took my findings to the SEC, and at the same time, put a freeze on the employees and wouldn't allow any of the retirement fund Marvel stock to be sold. Then they announced an adjustment to earnings and the stock price fell by fifty percent."
"All that proves is the Marvel executives were running scared because they knew you were opening the company up for an SEC investigation. There's no law against someone looking out for their own interests. Perhaps they froze the retirement fund to avoid a further drop in the price, which would protect the investors. As for the earnings adjustment, they no doubt wanted to set the record straight in their own way, rather than allow for the perception of wrongdoing among their shareholders."
Un-freaking-believable. She was painting the execs at Marvel as the wounded party in all this. They'd lied, cheated and ripped off the investors by selling out before the stock price tanked. But Barbara Clemmons had the nerve to insinuate that I was Chicken Little, causing a panic when clearly, it was all just a big misunderstanding.
She said in a tone now almost hostile, "I was given to understand we would see evidence at today's hearing. Instead, all you have are theories." The other senators nodded agreement, looking annoyed. Except Santorelli.
Excerpted from Show Her The Money by Stephanie Feagan Copyright © 2005 by Harlequin Enterprises, Ltd.. Excerpted by permission.
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