CHAPTER 17 #2
“Lady Cordelia was just beginning to tell us that there’s something very rotten within the East India Company,” said the earl.
Alison’s expression turned grave. “Any trouble there could ripple out to the furthest reaches of society.”
“Precisely.” Wrexford steepled his hands and tapped the point against his chin.
“So far, she’s told us how her brother became entrapped in a fraudulent financial scheme being run by someone within the Company.
And that the victim in the recent murder at Queen’s Landing was a clerk who had discovered the financial irregularities in the company ledgers and had alerted Woodbridge of the fact. ”
“It began with a plot to make an obscene profit from tea,” Cordelia said.
“But as you’ll see, the dastardly scheme has evolved considerably over time.
The conspirators are malefactors of the worst sort, but they are supremely smart and sophisticated businessmen.
” Cordelia paused. “However, as I said, it all started with tea.”
“But . . .” Alison looked troubled. “But that’s impossible. I’ve heard the highest officials in government and the Company’s board of directors say that not even a teaspoon of leaves can be exported, save through the Chinese emperor’s consortium.”
“It’s difficult,” allowed Cordelia. “But not impossible.” She shifted in her chair. “It all has to do with silver.”
“Argentum!” exclaimed Charlotte.
“Yes, Argentum is the name that the conspirators gave to their clever scheme.” Cordelia pursed her lips and thought for a moment.
“You see, the Chinese emperor will accept only silver as payment for tea and most other goods exported from his country. That has made silver a valuable commodity here in the West, which has driven up its price.”
“That’s simple economics. The law of supply and demand,” observed the earl.
“Correct. And the situation is made even worse because the emperor will not allow his countrymen to buy British products in return. As a result, silver is flowing out of Britain to China, which has our Treasury extremely worried and further feeds into the increased price for us over here,” said Cordelia.
“But that’s where the story begins to get complicated.
When I said there was fraud going on within the Company, unfortunately, I can’t tell you who is involved.
Jamie and I have only met one of the henchmen, whom I call the Cobra, on account of his soulless reptilian gaze. ”
She took a moment to steady her voice. “Nor can I say whether the corruption is known to their superiors. But rot has a tendency to spread . . .”
Charlotte couldn’t in good conscience disagree. Money was like a canker, eating away at even the strictest sense of morality.
“To get back to the details of the plan, the dastards originally came up with a scheme that allowed them to profit in multiple ways.” Seeing that Wrexford was about to speak, Cordelia hurried on.
“First of all, they set up a smuggling operation to bring opium from India into China, where only a very small amount is legally allowed to be imported. They make a large profit. As you say, milord, supply and demand.”
“And they ask for the payment in silver,” guessed Charlotte.
Sheffield’s eyes widened. “Supply and demand! I’ll wager they were able to demand a great deal of silver for their opium, due to its scarcity.”
“Correct. You see, Mr. Sheffield, you have a very good head for business,” said Cordelia. “They were, in effect, getting the silver at a very cheap price.”
Sheffield again jumped in. “So I would guess they took the silver, used it to buy tea from the emperor’s consortium, and brought the tea back to England, presumably using false accounts to make it all seem like legitimate East India Company business.
And thereby they would make another healthy profit. ”
“Exactly,” answered Cordelia, with an approving nod. “However, the dastards soon saw a way to improve on their scheme.” She turned to the dowager. “To cut out the risk of shipping it back, they sold the tea to another foreign merchant—”
“Wait! I thought you said the Chinese controlled the trade in tea very strictly,” protested Alison.
“They do. But all the foreign merchants are confined to a certain enclave at any Chinese port open to international trade. Canton, on the Pearl River, is the principle site used by foreigners. Within these enclaves are ‘factories,’ which is what the offices and the mercantile agents—”
“Actually, the mercantile agents are called ‘supercargoes,’ or daban in Chinese,” interrupted Sheffield. When Cordelia raised her brows in surprise, he added, “As our company is planning to trade with China, I’ve been doing research on the subject.”
She gave a small nod. “It is these supercargoes who help facilitate all the financial transactions. Once the official business with the Chinese officials is completed and the tea is moved to the export area, there are side deals to be made.”
“On which, I assume, the Chinese choose to turn a blind eye,” said the earl.
“A smart move,” mused Sheffield. “Much better to leave it to the supercargoes, with their established trade routes and network of bribable officials, to disguise all this as a part of their legitimate trade.”
“Yes, but then the laws of economics took over,” Cordelia continued.
“The emperor began demanding more and more silver for his tea. And it appears, based on what Jamie overheard a loose-lipped assistant to the Cobra say, that the conspirators began to worry, as they were paying out more and more bribes to men with whom it was dangerous to diddle.”
“Whatever did they do then?” Sheffield asked.
“To make a long story short, they got out of the tea business, trading only enough to appear to be a legitimate trading operation,” said Cordelia. “Instead, they concentrated on accumulating their silver.”
“I think I can see where this is going,” Wrexford interjected. “Because the silver was traded in the black market for opium, and because of the emperor’s demands for payment in silver, the conspirators were accumulating silver at a much cheaper price than existed in the European markets.”
“Yes, exactly, milord,” Cordelia responded. “The dastards came to realize that the true potential source of profit was their ability to get cheap silver in China, since it had a much greater value in Europe.”
Alison squinted in confusion. “So they began to trade in silver?”
“Well, for a time, yes,” Cordelia responded.
“But once again, the laws of market economics took over. They originally tried to have their partners—the supercargoes—bring the silver back to London to resell it at the higher price. But that, too, posed problems. The price of silver in Europe can be volatile, and this was a concern given the time it took to transport it back from China. In one of their earliest efforts, by the time they got the silver back to Europe, the price had dropped. That, plus all the bribes they had to pay to customs officials and co-conspirators within the Company for camouflaging the payments through East India Company accounts, meant they actually lost money on their trading.”
“Shouldn’t that have put an end to their machinations?” asked Alison.
Cordelia shook her head. “Alas, no. They are, as I said, very astute financially. They began to solve this last set of problems with bills of exchange.”
“Bills of what?” exclaimed Alison. “Forgive me . . . but I thought they were exchanging opium and tea and silver.”
“Bills of exchange have long been a common practice in the world of commerce,” explained Cordelia, “They began in the Middle Ages, and are now becoming even more prevalent as trade expands around the globe.”
“Ah! I’ve been studying these instruments, too!
” Sheffield’s face lit up. “They take a variety of forms. But I would think that what they did here was pay the opium suppliers in India with a bill of exchange, rather than cash in the form of either British pounds or the local Indian currency. Because of their international operations, the supercargoes had agents in most major cities along the trade routes. I won’t go into the habble-babble about how the pieces of paper travel around the world and get converted back into actual currency by the billholders, but the system works. ”
“An excellent summary,” said Cordelia approvingly. “There are a few other details, because of the various currencies involved and a few other technical aspects, but your description is bang on the mark.”
Sheffield flashed a smile, but then his expression turned perplexed.
“There’s still one basic element that puzzles me.
Didn’t the supercargoes then have the same problem of bringing the silver back to Europe, with the same risks of fluctuations in the price of silver and of detection?
After all, the conspirators still had to sell the silver in Europe to pay off the bills of exchange they had issued to their Indian suppliers. ”
“You’re right, Mr. Sheffield. I’m just about to get to that part,” said Cordelia.
* * *
“Perhaps we should order more tea before you begin,” suggested Alison. Despite the warmth of the afternoon, Cordelia’s words seemed to have caused a chill to settle over the room.
Feeling her head begin to throb, Charlotte pressed her fingertips to her temples. The case had unsettled her from the start, and she had a sense it was about to take an even darker turn.
The previous year she had done several satirical drawings that focused on a certain incident involving the East India Company.
Her usual informants had been too terrified to talk to her, and though she had managed to cobble together enough facts to make a commentary, she had come away with the sense that the Company was utterly ruthless in protecting its reputation.
“I think we could all do with some sustenance,” agreed Charlotte. She rose and moved to the diamond-paned windows while the parlormaid was summoned, hoping the sunlight slanting through the glass might warm the dread from her bones.
“Do you believe her?” murmured the earl as he came to stand beside her.
“I want to,” she admitted. “But like you, I shall try to keep a healthy skepticism until I hear the whole story. As of yet, we’ve heard nothing about Professor Sudler’s workshop, and I find it hard to imagine that those intricate gears and levers aren’t in some way connected to .
. .” A sigh. “To whatever evil Lady Cordelia is about to reveal.”
“I confess to a morbid curiosity as to what that connection is,” responded Wrexford. “On a purely intellectual plane, the scientific innovations of Sudler’s mechanical device appear to hold revolutionary possibilities.”
“Yes, but as we’ve seen in our previous cases, science is not a beautiful abstraction. Theories in themselves aren’t good or evil. It’s we who twist them to do our bidding.”
He looked at her in concern. “You’re usually not so pessimistic.”
“I’ve become well enough acquainted with Lady Cordelia to know she doesn’t frighten easily.” Charlotte closed her eyes for an instant. “She’s rattled, and I have to assume there’s a good reason for it.”
Clasping his hands behind his back, Wrexford turned to stare out over the back gardens and sloping lawns. A breeze ruffled the ivy twined around the windows, setting the dark leaves to whispering against the panes.
The sound drew her from her brooding, and she found herself gazing out at the pastoral scene.
“Hell and damnation,” muttered Wrexford.
Charlotte suddenly saw it, too—a hulking grey shape stalking within the small glade of trees skirting the walled rose garden. “Good Lord, is that a wolf?”
“No.” A pause. “It’s Harper.”
Harper appeared to be the size of a small pony. . . .
A flurry of fierce barks rumbled through the glass. “He’s a Scottish deerhound,” added the earl.
A gasp slipped from her lips as she spotted Raven and Hawk moving through the shadows close to the beast. “Is Harper dangerous?”
“Not usually,” answered the earl. He hurriedly unlatched the window and let out a piercing whistle.
Harper pricked up his ears and then turned and came loping across the lawn. On reaching the window, he leaped up and planted his huge paws on the stone sill.
“Hallo,” murmured Wrexford, curling his fingers in the hound’s shaggy ruff and giving a vigorous rub.
With his lolling pink tongue and wagging tail, the animal didn’t look quite so fearsome up close, decided Charlotte.
“He’s quite good natured,” explained the earl, “save for when he feels the estate is being threatened.”
“What possible threat . . .” The words died in her throat as she saw the boys break free of the trees.
Hawk was brandishing an Elizabethan small sword, while Raven was cradling a medieval crossbow. And between them was the Earl of Woodbridge, his hands bound in front of him with a rather soggy-looking rope.
Cordelia must have spotted her brother from one of the side windows, because she rushed to join them. Elbowing Wrexford aside, she leaned out the window. “Raven! Dash it all, untie your prisoner this instant!”
As the dowager and Sheffield joined the commotion, Cordelia expelled an oath. “Damnation! Jamie was supposed to stay with the professor and his Engine.”
“Well, well,” observed Alison with an owlish blink. “The plot thickens.”