Chapter 107

The CEO of Travel Corp. almost spit his coffee across the room when his assistant informed him that Elizabeth Barton-Warner was waiting to see him. The man glanced nervously at his watch and it confirmed what he already knew: He was late.

The day had started off poorly with an argument with his teenage daughter over the attire she had chosen for a trip to the beach with her friends – a fight that extended from the weekend and filtered down to his younger daughter. He found a flat tire on his sports car and, rather than take his wife’s sensible sedan, he waited for Triple-A to come to his aid. Now it was almost 10:30 in the morning and the owner of the corporation was waiting for him – and probably had been for at least an hour. He pulled out his cell phone to see why no one had called him and found that the battery was dead.

Beth stood and offered her hand when Gregory Hansen walked through the door to his office.

“I’m sorry that you’ve been kept waiting,” Hansen said. “It’s been a rough morning at the Hansen household.”

He didn’t want to make excuses but he felt Elizabeth deserved an explanation.

“Oh, we’ve had our fair share of those, haven’t we, Philip?” she said, transferring the smile to her son. The son returned the smile and nodded.

“I hope everything is OK,” Beth said.

Hansen shrugged and put his coffee on the desk.

“I have a teenage daughter and one just ready to enter her teen years,” Greg Hansen said in a weary voice. “We live near Malibu and that means they go to the beach almost every day. All of Marissa’s friends have these bikinis that are far too small – at least in my opinion. Marissa bought a similar one Saturday and we’ve been fighting about it ever since. She put it on this morning just to show me how grown up she is. Now my younger girl, Alyssa, thinks she needs one, too. Marissa is 17 and I know that I can’t control her life any longer but Alyssa is another matter. I just don’t know what to do.”

“So long as she’s with friends, it’s probably harmless for the older daughter,” Phil chimed in. “My girlfriend and her friends like to be daring – mostly so they can say they’ve done it when everyone else starts talking about it. I don’t have any experience with younger girls. If she’s responsible, maybe this rebellion is better than other things she might try. Maybe you can get it for her and let her know that she can wear it in the backyard or while you or your wife is with her until she’s older. I would suspect that once she sees the reaction from people she doesn’t want a reaction from, she’ll understand your reluctance.”

Greg Hansen found himself nodding as he listened to Beth Warner’s son. He had no idea of how to handle his kids half of the time and this sounded like a better plan than the one he didn’t have.

“Maybe Philip and I can treat you and your family to dinner while we’re in town,” Beth suggested. “I’m not so old that I don’t remember how awkward my teen years were. A lot of young girls dress that way just so they can have validation that they’re attractive to other people. But Philip is correct. It gets really creepy when some 45-year-old man watches you walk past instead of the quarterback on the football team. Do you have a few minutes so we can discuss some business?”

“Absolutely!” Greg said. “I blocked off this morning for going over our fourth-quarter projections.”

Phil knew this because Rob Costello had gotten him into Hansen’s computer and his schedule.

“I can tell you some of what you’ll find,” Beth said. “You’re going to find that you’re underperforming – again.”

Hansen took a deep breath and seemed to deflate as he let it out.

“I just don’t see how that’s possible,” he said, shaking his head.

“Oh, we know how it’s possible,” Beth said. “I’m not sure if you’ve heard but I’ve put Philip in charge of Barton for the past week. I needed a vacation and the week was supposed to be fairly uneventful. Sadly, Philip and his assistant, Hailey Warren, made certain that uneventful was the last thing it was.”

Greg Hansen glanced at the young man at Elizabeth’s side. He didn’t appear embarrassed or upset that his mother had told a stranger that he had failed his test.

“Philip found several discrepancies in some of Barton’s subsidiaries,” Beth continued, never realizing that she had given the CEO the wrong impression. “I’m sad to say that the biggest discrepancies came from Travel Corp.”

“Wait!” Greg Hansen said urgently. “Our CFO resigned suddenly last week and I’m not really up to speed on a lot of the financials. That’s one of the reasons I was going over them today.”

“Your CFO, Ms. Julie Marshall, is the prime reason Travel Corp. has fallen below expectations since well before the acquisition by Barton Holdings,” Beth said.

“Julie?” Greg asked, sitting back heavily in his chair. “That can’t be right. I’ve known her for 20 years. She and I rose through the ranks together. She was promoted to the head of accounting at the same time I was made head of sales. That just isn’t possible.”

“It is possible,” Phil stated firmly. “You’re aware of the change to discretionary spending? I put that in place because I found two people at Travel Corp. raiding it with great regularity. Julie Marshall was the biggest perpetrator but there is a young man in your IT department who also had his hand in the company till. Ms. Marshall apparently figured out what had transpired and decided to run for it. We have a former Secret Service agent pulling every aspect of your financials for the previous five years and she will be charged with perhaps 200 counts of grand larceny and embezzlement by the end of the week. We estimate that she has pilfered more than $250,000 from Travel Corp. in the past five years. She has a pretty serious gambling problem and she was using the discretionary funds to support it.”

Greg Hansen covered his face with his hands and groaned.

“How did I miss that?” he asked the room at large.

“You missed it the same way that I did,” Beth confided. “The discretionary accounts are generally so small that we don’t pull the records with any frequency. When we do look at them we gloss over the expenditures so long as the funds aren’t depleted. We never take into account that someone might transfer money from another account to keep it liquid. That’s what happened with Travel Corp. Ms. Marshall moved funds from overfunded areas to the discretionary account. Then she took the funds from the account without anyone thinking twice about it. Philip has only a rudimentary knowledge of accounting so he looks at the bottom line. If it doesn’t match his expectations then he delves through every single line item until he finds out why not.”

“How did you pinpoint Julie?” Greg wondered. Beth looked to her son and then sat back in her chair.

“Let’s take a few things as a given,” Phil said as he moved to the front of his seat. “Every single piece of equipment – every desk, every chair, every stapler – in this building belongs to Barton Holdings. We are the sole owners of Travel Corp. You have no outstanding stock that we don’t own. Do you agree?”

“Well, yes,” Greg answered. He wondered why the conversation started in this manner.

“Good,” Phil said. “So I elected to place spyware on Barton Holdings’ computers in this building.”

“You...” Greg began but Phil spoke over him.

“I had our security firm place a program in your accounting upgrade last week,” Phil continued. “Anytime someone from Travel Corp. accessed any of its discretionary accounts the computer’s standard camera took a photo of that person and e-mailed it to my account. I had already identified a handful of people who were our prime suspects. It took me a day to find out that the same user name and password were input each time someone stole from us. What was unusual is that the user shouldn’t have had access to the discretionary funds. Furthermore, he was never in the office when the funds were taken. That told me that someone was trying to cover his or her tracks. Within two days, I found a photo of Julie Marshall sitting at the terminal as she attempted to remove $5,000 from the account. Of course, I had already blocked access to those funds.”

“Damn,” Greg said. “I will have to say that I am singularly displeased that you chose to spy on us.”

“And I am singularly displeased that you’ve allowed a quarter of a million dollars to disappear because you were too lazy to track it,” Phil shot back. “So you can be pissed off at anything you want but know this, if I had my way, you’d be following the unlamented Julie Marshall out the door.”

Greg Hansen gulped when he glanced at Elizabeth Barton-Warner. Her face showed no emotion at what her son had just said. He didn’t know whether she agreed with her son or not.

“Now that we understand our relative positions, let us continue,” Beth said after a moment. “What Philip chose to do was well within our rights as owners. He had my full support and he got to the bottom of the problem within a week when it would have taken you or me six months to get there. What he said is absolutely correct. Ultimately, this falls at your feet and at mine. You’re responsible for Travel Corp. and I’m responsible for you. We both missed it and we’ve both missed her behavior for years. There is no excuse for that. Regardless of any other obligations on our plate, we are responsible for the losses that this company has incurred. She was your employee and you are my employee. That’s all there is to it. Now we have to figure out where we go next.

“I will confess that at the beginning I was in complete agreement with my son. If I had seen you last Wednesday, it would have been to fire you. I came to the realization late last week that I would have to fire myself, too – for the reasons I’ve just given you. So you have a reprieve – for now. I’m going to be out here through Friday night. Before I leave, I will decide if you will keep the title of CEO or if I will demote you and replace you with someone from one of our other divisions. I don’t want any misunderstanding on your situation or about my intentions. I believe Philip has put together a system that will remove the abuses we’ve seen at Travel Corp. and, on a much smaller scale, at some of our other assets.

“What I want to know is how this transpired for the better part of a decade without a hint to you about what was going on. I want you to be able to explain to me why you didn’t see the large sums moved from other line items into the discretionary accounts when you went over the quarterly financials. I will want a plan from you as to how you can keep this from happening again. Lastly, you can bet your ass that I will want to meet the person you plan to have replace Julie Marshall. If I find this person unacceptable, I will send you someone from one of our other divisions to act as CFO – if you are still installed as CEO. Do we understand each other?”

Greg Hansen closed his eyes tightly and nodded.

“Let’s plan on dinner with your family later in the week,” Beth continued. “Whenever works for you is fine with us. We’ll treat you to a night out with no business discussions. I’d like to get to know your family. I’m not sure I’ve seen them since we acquired this company four or five years ago.”

Again, Greg nodded.

“I’ll check with my wife and let you know,” he said. “I’m embarrassed that I had no idea of what was happening right under my nose. I’ll do whatever I can in the next few days to see why things happened as they did. Perhaps we can meet again Thursday or Friday morning.”

“That would be fine,” Beth agreed as she stood. “Philip and I can show ourselves out. We have another stop to make before we leave for the day.”

“I’m sorry if I pushed you somewhere you weren’t ready to go,” Phil told his mother as they boarded the elevator.

“It’s fine,” Beth assured him. “I was a little unsure if I wanted to give him a warning but it’s best that I did. You handled it pretty well. You’re going to find a lot of that. You’re young and people are going to try to push you. I was pretty happy with how you handled it. You didn’t belittle him but you stood up to him. You didn’t play the ‘I’m your boss’ card that so many young executives play. You told him what you found objectionable in clear and concise terms – and in a way he couldn’t refute. We’ll talk a little more about it later. Right now, let’s move on to Adrian Karl. What do you know about him?”

“Cal-Tech grad,” Phil recited. “Started at Travel Corp. as an intern while in college and moved up to full-time job in the IT department as soon as he graduated. He’s a top-flight computer engineer, according to Rob Costello. Rob said and I quote, ‘If he wasn’t a fuckin’ thief I’d hire him in a heartbeat.’”

Elizabeth shook her head but chuckled.

“No gambling or drug addiction that we can find,” Phil continued. “We did a credit check and he’s solid. He has no huge debts that any other 25-year-old doesn’t have. He was on scholarship at Cal-Tech and he has only one student loan, $2,500, that he’s paying back at $55 a month. He shares a house with an older woman, most likely his mother or an aunt. He drives a used car very similar to the one I used to own and it’s paid off. Basically, he’s supplementing his income by skimming about $50 a month from the company but he doesn’t appear to be spending it anywhere. He’s paid pretty well for someone with his experience, to be honest, and he lives within his means.”

“What’s the total?” Beth asked.

“We estimate a little more than a grand over the past two years,” Phil answered. “He takes $25 or $30 a shot and he’s doesn’t hit the account every week or even every month. Rob said, and I tend to agree, that the guy is probably pulling money from the account for overtime he’s worked but isn’t being paid for. All the IT guys are on some sort of salary structure. Don’t ask me how but Greenbaum said it’s legal because of the technical aspect of their work. Rob agreed with him so I just nodded and took it as gospel. I don’t know anything about exempt or non-exempt employees. I’ll need to pick up some of that information and I don’t think it’s going to come from Heilman.”

“So he basically feels like someone is screwing him by asking him to come in on Saturdays to fix something and he takes his overtime pay from the discretionary accounts?” Beth asked.

“That’s the way Rob sees it,” Phil replied. “The guy I had watching him said Adrian Karl is perhaps the most boring 25-year-old on the planet. He goes to work, stays eight or nine hours, and goes home right afterward. He didn’t hit the clubs or a bar. He doesn’t have a girlfriend that we can find. He has no known vices that we can uncover.”

Beth nodded as the elevator stopped at the basement – or where the IT department was housed. She and Phil exited and walked down a corridor. Phil spotted Adrian Karl almost immediately, working at a terminal. He pointed him out to Beth with his chin and she nodded. They stopped when they came to the department supervisor’s office. There was no gatekeeper or secretary outside. There wasn’t even a desk for such a person. Beth shrugged and knocked on the door.

“Uh, come on in,” a voice said. A middle-aged man looked up from his laptop when Beth and Philip entered. He didn’t recognize either of them but he also knew that no one without authorization could get past security on the floor above them. The rumors – started by Greg Hansen’s assistant – that the Barton execs were on-site hadn’t filtered down to the bowels of the building.

“Can I help you?” he asked in an amiable voice.

“I hope so,” Beth said. She pulled out her laminated ID and Phil did the same. “I’m Elizabeth Barton-Warner and this is Philip Warner. We’re from Barton Holdings headquarters and we have some issues we’d like to discuss with you.”

The man blinked hard and gave his head a little shake.

“Elizabeth Barton-Warner,” he repeated, “of Barton Holdings headquarters.”

He let out a long breath.

“You can call our office and verify our identities,” Beth offered.

“Or you can go online to our corporate home page and at least identify Mom is who she says she is,” Phil added.

“I’m sure you’re who you say you are,” he said. “Otherwise, well, you’re wasting your time down here. I just don’t see what I can do for you. We’re pretty much forgotten in the grand scheme of things. You’d never know that Travel Corp. is pretty much a web-only enterprise at this point.”