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time.""' Asked if Green was involved in the purchase and sale of collateral instruments, Cocke replied: Probably not as an individual. But he represented the clients that certainly wanted to do the same thing.” ...was one of the very early transactions, as far as I am con- cerned, with Hammer. I think he [Dan Hughes] is the one who expanded Hammer in the sense that we moved from one hundred million [dollars] to a billion-type movement, and now we are doubling, about a trillion. He is the one who enhanced it, is the best way of saying. News in late March 2003 revealed that the Empire State enhanced it, is the best way of saying. Building had just been sold by casino king Donald Trump and the heirs of shady Japanese billionaire Hideki Yokoi for US$57.5 mil- THE HUGHES PORTAL lion. Yokoi (who, at the time, was serving a prison sentence and Dan Hughes, Jr, the nephew of US Representative William J. had secretly negotiated the transaction through a middleman) and —_— Hughes from New Jersey, made a considerable fortune in the con- his partner Trump had gained ownership of the building in 1991 struction business in Florida during his early working life. By the for US$42 million. Little is known about Yokoi's World War II mid-1980s, with paper assets nearing US$100 million, he became activities. involved in collateral trading and by late 1989 entered the realm The building last changed hands four decades earlier in 1961, — of Project Hammer. when it was acquired by real estate tycoon Harry Helmsley from During the autumn of 1989, Hughes was approached by Peter the Prudential Insurance Company in a sale-leaseback deal. The Seaman, the President and Chairman of a small investment bank world-renowned skyscraper was built on called Nantucket Holding Company. land owned by the Astor family and sold to Seaman had developed an arrangement with the DuPonts in 1929. Construction of the Ecoban Limited, a small merchant bank with Empire State Building began in 1930. John offices in London and New York City that Jacob Astor was one of the first Americans specialised in emerging market-debt and the to become involved in the opium trade, from A'forfait market.'* Seaman, using Nantucket which his later fortune derived. This he The ancestor of all Holding Company, concluded an agreement invested in Manhattan real estate. The . . by which Ecoban would purchase US$100 architects of the Empire State Building were trust companies IS million worth of documentary letters of cred- Shreve, Lamb & Harmon Associates — England's Foreign & it issued by the head offices of Citibank NA designers of One Bankers Trust Plaza, the . and the Chase Manhattan Bank NA. Hughes HQ of Bankers Trust, together with the Colonial Investment had access to these bank credits via a US$50 Credit Lyonnais building in New York City. Trust, which dates billion "commitment" extended to him by the It is of more than passing interest that one law firm represents many of the "actors" who appear in this story. That firm is White & Case. Amongst numerous notable achievements listed on its website background/history is its representation of the DuPont Group in its sale of the Empire State Building in 1954 for the princely sum of US$51.5 million. As we noted earlier, almost 40 years later, in 1991, the building sold for the less than princely sum of US$42 million. I am not certain how the real estate investors define invest- Bankers Trust Company. To fund the purchase, Ecoban needed the support of a bank and turned to Midland Bank Aval Limited (MidAval), the forfaiting subsidiary of Midland Bank Group International Trade Services (MiBGITS). MidAval, once wholly owned by Midland Bank, had, shortly before commencing with the Hammer transaction, concluded a private agreement with Sir William Purvis, Chairman of the Hongkong and Shanghai Banking Corporation, where- in HSBC purchased a controlling equity ment performance over the years, but stake in MidAval. This meant that an aggregate loss of US$9.5 million MidAval was 60% owned by HSBC over the course of 37 years doesn't usually constitute an invest- and 40% owned by Midland Bank." ment accomplishment by any standard I know.” Accordingly, on 12 October 1989, MidAval issued a letter Meanwhile, a brief review of White & Case's client list tell us agreeing to purchase "$100 million with rolls until funds are that they also represented the First National Bank (the forerunner exhausted of documentary letters of credit..."'* An earlier of Citibank), Astor Trust Company," Prudential, J. P. Morgan & MidAval letter (dated 25 September 1989) stated that they "irrev- Co., Saudi Aramco, Swiss Bank Corporation and Seagram ocably commit to purchase the above letters of credit and pay the back to 1868 and was conceived by one of the foremost legal minds of the day, Lord Westbury. Company Ltd of Canada, controlled by the Bronfman family— amount agreed between you and Ecoban Limited (‘the purchase regarded by some as the kings of the Canadian mafia.'* But White _ price’) to Citibank NA, Lugano". & Case's most "enduring" client is Bankers Trust Company, a The reference to "Lugano" was deleted in later letters at the J. P. Morgan-controlled bank which the law firm was "centrally specific request of Nantucket's Peter Seaman, as detailed in his 11 involved" in forming back in 1903. October 1989, letter to Brian Fitzpatrick, the Managing Director The ancestor of all trust companies is England's Foreign & of Ecoban Limited. Lugano was of some considerable impor- Colonial Investment Trust, which dates back to 1868 and was tance—as we shall see later—but not least because it was at conceived by one of the foremost legal minds of the day, Lord — Union Bank of Switzerland in Lugano where, according to Dan Westbury. The current Lord Westbury, Richard Bethell, will Hughes, the actual trading of the Hammer programme took place. appear later in this story. Meanwhile, MidAval's letter was addressed to Jardine, Emett & But first, let's step through the looking glass and examine one Chandler, New England, Inc., in Boston, USA, which acted as an of the early Hammer deals, which General Cocke believed: agent for MidAval. On the strength of MidAval's signed and trust companies is England's Foreign & Colonial Investment Trust, which dates back to 1868 and was conceived by _ one of the foremost legal minds of the day, Lord Westbury. 36 ¢ NEXUS The ancestor of all WWW.NeXU smagazi ne.com AUGUST — SEPTEMBER 2003