Chapter 3

Carolyn met Becky in the lobby, and they came to my office. I greeted them and tried to encourage Becky to be relaxed. Carolyn showed her around the Jenkins Bank floors, and they took a less extensive tour of the law firm's offices. She introduced Becky to the group that handled my personal business. Carolyn found the contact person who would handle Becky's accounts and left Becky with the bookkeeper. Becky was told how she would be reimbursed for expenses and paid for her contract; it wasn't a question of whether, only the procedures for how. The bookkeeper called Henley who came to the bookkeeper's office for Becky. They went to Henley's office to talk about the project and how they could best work together. Before lunch, I called Henley. He reported that they could work together. I went to Henley's office.

I could tell immediately that Henley liked Becky. I said, "A number of the senior people will be retiring soon. I'd like a plan to make sure our quality doesn't suffer when they leave. I'm convinced the system Henley and Shinkle are developing will allow us to do that with a small core of people. I prefer the core be trained at Roselawns and be smart paralegal-like people with very few actual lawyers. Becky would be the attorney in charge. Her friend Bernie will be the knowledge expert. Bernie's job will be quality control and monitoring changes in the law. Priority order is legality, quality, sustainability, and cost control. I'd rather have two part-timers working on a single module of the expert system than a single person that is hard to replace. I want strong cohesion and weak coupling."

Becky said, "I understand. Losing your grandfather and having the senior people retire all at once was a good lesson."

Will was the even stronger lesson, a reality lesson!

Henley said, "Shinkle, Becky and I will come up with a good plan. Becky knows the per diem lawyer market, and I'm pretty good at selecting accounting students who would be good."

Becky said, "Long Island is a treasure trove of mothers, wives, and divorcees, who would be loyal long-term employees."

Henley said, "And we have the time to train them. I think Becky's idea of a cadre of part-time attorneys is something to consider. I bet the same model would work for part-time CPAs too."

I said, "Little steps. First, take care of the securities area of the law firm, so when I'm admitted to the bar, we have a model for Jenkins and Jenkins."

Becky said, "That's about three and a half years. Are we going to be able to do anything until then?"

Henley said, "We can start training and cover about twenty percent of Jenkins and Jenkins applications by January. The first modules to go on line will be the government bonds. We should have the utilities area done by the end of Rob's first year of law school."

"I have to do the first year of law school at the University of Alabama. There's some flexibility during the second year. I'll probably need to finish at Alabama. I still might see about a transfer to Columbia after the first year. I'm going to Alabama this afternoon. I should be back Monday."

Becky stopped by my office at two-thirty. She said, "It went well. I'm very excited."

I walked her to the lobby. I got my things together and was ready to leave when Karen arrived. I got in her taxi, and we went to the LIRR. A shuttle was at the Ronkonkoma station and took us to Macarthur.

Karen had her overnight bag and sandwiches for the flight. She was in a sundress.

I said, "You look beautiful as usual." She smiled.

I got cold Cokes for the cooler and preflighted the plane while Karen was in the restroom. We got off at five-thirty.

Karen wanted to talk more about my stations in Alabama. I told her a little about the stations and how the link with WSM worked. She was very interested in WAPI television.

We landed in Maryland at the historic old College Park Airport, refueled the plane, parked beside the 94th Aero Squadron Restaurant that had a WW I French farmhouse espadrille mess hall theme. Karen and I had the petite filet mignon and Australian lobster tail, beer cheese soup and garden salad. I suggested to the waiter that the restaurant add Caesar salad to their menu. Karen liked the theme atmosphere. The meal was enjoyable, and we left full. We flew into the University airfield in Tuscaloosa and got to the house about midnight. I said hi to Leon, who stayed in the apartment over the garage while he attended classes in the University's BSN program and finished studying for the RN exam. He had done his RN related classes at the community college.

Karen and I got in the Jacuzzi where we hooked up. We continued round two in the bedroom and slept spooned until morning.

We had a most pleasant wakeup and shower, then I fixed breakfast as Karen got ready to see her family. Leon had the refrigerator stocked with fresh fruits and fresh fruit salad. We had eggs over easy, grits, country ham, Texas toast covered in honey, and fresh fruit salad. I ate a full plate, Karen had eggs, toast but no honey, a small piece of country ham and fresh fruit salad. I waddled to the car and drove Karen to her parents' house in Ensley. I brought her luggage into the house and greeted her mother, brother and sister, then left to meet Beau at Lauderdale. Beau had flown down from Wallingford and stayed at the plantation. Libby and her sorority little sister were in France. They were taking classes at the Cordon Bleu like Lib had. It was Libby's second summer of classes at the famous cooking school. Libby's little sister also took art classes, and Libby took an advanced international banking class. Since Libby didn't date, she had time for both the class and cooking school. They went native, in that they only spoke French, dressed like they were French, and acted like they were French; they were so good, they passed for being French. They traveled on the weekends and visited museums and the French countryside.

Beau had learned a lot at Wallingford Bank and from Will. Beau stayed with Will, and they talked about banking nonstop, more than Brooke liked. Brooke liked Beau's kitchen skills, so she accepted the situation. Will and Beau played golf at the best clubs in the area, and Beau met many of the Wharton finance avant-garde. Beau planned to return to Wallingford after the directors' meeting.

Beau and I had a private meeting before the officers' meeting. Beau had said he wanted to discuss some things related to our private financial situation.

I greeted Lib, and Beau and I met in the guesthouse. He said, "I think I can improve the structure of our off-shore accounts."

I waited for him to continue.

Beau said, "One of the best statutory safe harbors is deposit through a government's bank. A foreign treaty is probably next best. In San Marino we can combine both. I have established two family trust accounts in the government bank of San Marino. We need to designate the trustee for both trusts; someone not closely tied with us financially. A US treaty allows for tax-free direct investment in the US by San Marino citizens if done through the government bank."

"San Marino, is that in the Caribbean islands? How safe is it?"

Beau said, "No, it's a city-state surrounded by Italy, like the Vatican. It's very stable, but for us, it's an in-and-out transfer bank to route funds to Lichtenstein or the Caymans. One of your trusts owns a bank in the Caymans, where your off-shore trading is done. If we observe the niceties, it's all very legal under the current US banking and tax codes. As part of First National's stock repurchase, the bank repurchases some of your stock and pays you only your basis, thus no tax gain for you on the repurchase. First National will finance the stock repurchase with funds loaned from your San Marino account. That converts most of your First National stock from Alabama held stock to foreign bonds, a wash for you, but you have the bonds that will make the interest payment tax deductible to First National and tax free interest payments to your San Marino account. You don't control the trust, so it stays legal for you. I have the power of trustee appointment for your account, and you have it for mine. We pay one point to the San Marino bank as a transaction fee. Additionally, there is another treaty that encourages Caribbean investment in high tech startups, and Wallingford has found ways to use that treaty to move off-shore funds for stock purchases. Lichtenstein is for noninvestment fund transfers from trusts beneficial to you."

"Will talked about doing something like this. Do you like all these shell games?"

"Raiding, arbitrage, foreign shell games and junk bonds are what Wallingford does. The downside is that if you're not very, very careful, you could end up in jail. I think Lauderdale Investment Bank will operate more conservatively, like Jenkins, but working with Will and Wallingford are great learning experiences. Lauderdale has a huge competitive advantage with its link with Jenkins and access to Jenkins' capital markets. If we, okay if I, don't get greedy, Lauderdale can do very well without the risk of Wallingford."

I asked, "But you want me to do this San Mateo thing?"

Beau said, "San Marino, not Mateo. You're already off shore; your grandfather set most of it up. I just want to improve it and make it safer. One basis point is almost nothing to make sure you're legal. This is only for you and me, not clients."

"What do you want me to do to make it work?"

Beau said, "I think the assets you got from your grandfather are fine. It's the bonds for the redemption of the outside stock that should be handled through San Marino. I'm going to do the same thing with most of Lauderdale. There's not much to gain for St. Joe. Most of its profits already receive favorable treatment under the U.S. Tax Code as long term capital gains."

I asked, "Is that it?"

Beau said, "I'm finished."

"How's Libby?"

"Too far away. You need to meet Pris, her little sister. She's really first class."

I said, "Karen and I are going out. It may get serious."

Beau said, "I hope it works for you two."

"She came down with me. She's at her parents' house."

Beau asked, "Anything happening in the City?" Rob was aware that Beau was uncomfortable and changed the topic.

"I took a couple of broadcasting classes at Columbia. I'm still working on the Securities automation software project at the firm. A number of the people in the firm are going to retire next year, some on July one and some February one. Most of the key people agreed to stay until I pass the bar. The billing at the firm has picked up again, and the bank is back where it was before Will rejoined Grandfather. I'm glad the radio network and the country music thing are going well. With things stabilized, I'll feel better once we start the First National stock redemptions. I'm glad the plan is for a phased redemption. I won't worry as much, and I worry enough about law school."

Beau said, "You'll do fine."

We went across the hall and saw Jane, who had come in from Birmingham and was with Lib. I said, "How's my favorite bank president?"

She said, "Hungry. I didn't eat this morning."