JM02 - Death's Little Helpers aka No Way Home by Peter Spiegelman

actually had an idea— a vision of Piedmont’s future.
    Ainsley saw that Piedmont’s marketplace was badly fragmented, with many small suppliers and no dominant player. He recognized that the market was ripe for consolidation and that, with the right financing, Piedmont could grow by acquiring its competitors, moving their clients to Piedmont’s products, and squeezing out costs. And there was another, more radical, aspect to his plan. Ainsley understood the growing reach of the Internet and saw in it an opportunity for Piedmont to transform itself— to become a provider not of billing software but of billing services. He saw, in short, an opportunity to get Piedmont out of the software business and into the outsourcing game. This was what had caught Gregory Danes’s eye.
    Three months after Ainsley’s installation as CEO, Danes became the first analyst to cover Piedmont. He was unequivocal in his support for the company’s strategies and beyond bullish on its future value. His declarations attracted more research coverage to Piedmont, and more investors, and the company’s shares jumped.
    None of this was lost on Denton Ainsley, who proceeded to cultivate close ties with the analyst and his firm. He invited Danes to speak at several of Piedmont’s lavish corporate retreats, solicited his views on takeover targets, and made him guest of honor at one of his celebrity-laden charity pig roasts. As for Pace-Loyette, Ainsley tapped the firm as Piedmont’s investment banker on all acquisitions and named it lead underwriter on the company’s secondary stock offering. Pace also became Ainsley’s personal banker, extending him hefty loans, collateralized by hefty chunks of ever-more-valuable Piedmont stock.
    For a while, while the market climbed, all was well. Piedmont’s growth strategy proceeded apace, subscriptions to its new outsourcing service sold faster than planned, and the company’s stock became a must-have for anyone who wanted to invest in the Internet. Pace-Loyette collected its fat banking fees, Danes’s reputation shone ever brighter— as did his outlook on Piedmont shares— and Denton Ainsley undertook elaborate renovations to his newly purchased Napa Valley château. And no one paid much heed to talk of accounting irregularities and falsified sales figures at Ainsley’s old company, Dentco, or to questions about Piedmont’s subscriber numbers, or to complaints that its software just plain did not work.
    When people did take notice, the unraveling was fast and violent. The SEC announced its inquiry into Dentco one Monday early in the new millennium; the following day came its notice of an inquiry into Piedmont. Wednesday saw a class action suit by a group of Piedmont customers; on Thursday the Justice Department declared its interest in interviewing Piedmont board members. On Friday, the first shareholder lawsuit was filed.
    On Saturday, Denton Ainsley’s bright Italian car was fished from a pond on his Napa estate, and Ainsley’s body was fished from the car. Suicide by Ferrari was the unofficial finding of one cop on the scene— an opinion bolstered the next day, when the coroner established Ainsley’s astonishing blood-alcohol levels.
    The forensic accountants took a bit longer on the autopsy of Piedmont Science, but when they were through their report revealed massive fraud, hidden debt, and systematic looting of the company’s coffers— all orchestrated from the very top. By which time the company had largely decomposed.
    Piedmont had little in the way of assets, and its executives and directors relatively shallow pockets, and it wasn’t long before irate customers, investors, and regulators turned their torches and pitchforks on Piedmont’s bankers. At the time, their claims were novel: Pace-Loyette and Gregory Danes were either fools or criminals, negligent incompetents if they were unaware of Piedmont’s true financial condition, despite extensive dealings with the company, or