12

One day in early May 1981, Margolies summoned Oestericher. According to Oestericher, if he can be believed, while he was always aware of the general outlines of the Margolies swindle at that moment he was not cognizant of the details or the scope. But he knew enough to realize how successful Margolies’s plan had become. It was his hope and dream that soon, very soon, Margolies would offer him that implied partnership in a jewelry business, one that would make him rich and independent. And so anything that his friend wanted him to do, he was willing to do.

On that May day, Margolies wanted to talk about Barbera. She was doing a good job, he admitted. But she was untrustworthy. She had made off with copies of the books and records. It was essential to get them back and, at the same time, cast a cloud of suspicion over her, that she was not the loyal employee she seemed but a devious and possibly dishonest person who was stealing from Candor and trying to cover her tracks.

What Margolies wanted was Oestericher’s help in manufacturing some sort of evidence to show that Barbera must be stealing from Candor, and then he wanted to hire a private detective who would be given the evidence and who would then, among other things, shadow her for a time, thereby implying that Margolies was very concerned that his comptroller was not all she seemed.

He and Oestericher discussed the first phase and came up with what they were sure was an ideal solution. They got a copy, easily obtained, of a Merrill Lynch transaction slip and filled it in. It revealed that on November 13, 1980, Margaret Barbera had purchased 4,325 shares of Superior Oil Company of Nevada for $795,800. Copies of the document were made, ready for whatever use Margolies wanted to make of them. (As it happened, Barbera did maintain an account with Merrill Lynch and, indeed, had used it at one time to purchase on margin shares in Superior Oil, but her holdings had never exceeded $21,000.)

Then they hired a private investigator named Linwood Lewis, handed him a copy of the phony stock transaction slip, and set him to work. He looked into Barbera’s background and followed her for a couple of weeks, handed in a report, and then was told that his services were no longer required.

Lewis’s report stated, “On May 21, 1981, an investigation was started to monitor the movements of Ms Barbera when she was not at work at 15 West 47th St., N.Y.C The purpose was to find out if she was working at another job, or to find out the reason why she did not work a 9 to 5 job like most people.”

On at least a dozen occasions, Lewis tailed her. He noted, “On May 29, 1981, around 11:30 P.M., upon arriving at 15 West 47th St., I observed lights on the entire floor. Subject left the building around 2:15 A.M. She walked up 45th St. to Fifth Ave., down Fifth Ave. to 44th St. and disappeared in the garage on 44th St. between Fifth and Sixth Ave. Upon entering the garage after waiting outside for her, she could not be found. Asked the attendant, he stated he saw no one, but that there is another exit. One exit is on 44th St. and one on 43rd St. Checked with the cashier. She knew who I was talking about, because she stated she sees the lady and the car around this time a few times a week. She said the lady had just left. On my daytime surveillance, the subject would either go shopping at A. & S. and Macy’s on Queens Blvd. or just stay at home. Twice I followed her on the weekend to her girlfriend’s home in Teaneck, New Jersey. Learned from subject’s neighbors that she is a very quiet person and she stays to herself. About visitors, it was learned that a Chinese woman comes to visit, but that’s just about it. On the nights that I have followed her home from 45th St., she has gone directly home. She is not one of the slowest drivers in the world. Once she leaves the Midtown Tunnel exit on the Queens side of the tunnel, she runs like a bat out of hell. She opens up that BMW.”

Checking on Barbera’s background, Lewis found that until she went to work for Margolies, she had been something of a deadbeat. She had once had an account at Abraham & Straus department store, while she was in college, but she had fallen behind and it had been turned over for collection. The same thing had happened with a charge account at J. C. Penney, and a $1,262 loan she had taken out at Chemical Bank also was in default. She had borrowed money from the United Student Aid Fund to pay her tuition at NYU, and that had never been repaid. At about the same period, she had borrowed from Beneficial Finance Company to buy a 1971 Chevrolet, had neglected to pay the last $45 on the loan, and that, too, had been turned over to the lawyers for collection.

But then, suddenly, she seemed to have plenty of money. She had bought a 1981 BMW 320i and paid the $17,700 purchase price with a cashier’s check, and then came up with another couple of hundred dollars for some extras. The BMW, Lewis noted, was registered in New Jersey at an address in Teaneck, the home of Edward and Jenny Soo Chin, who other than being Barbera’s assistant at Candor and her very close friend and frequent companion “does little else but watch her children.”

In sum, Lewis concluded, there was nothing to point to her having committed any criminal acts. The only suspicious facts he could find was where she had come up with the money to pay for the BMW and where she kept her money, since she kept nothing in New York State, perhaps because she owed money in the state. But that was all.

There was, though, something else that Margolies and Oestericher asked Lewis to do. They asked him to break into Barbera’s apartment and search it. Margolies was sure she had books and records of Candor somewhere in that apartment, he told Lewis, and they didn’t belong to her, she had stolen them, and he wanted them back. Lewis was appalled. He wouldn’t hear of doing such a thing. He had a license and Margolies was asking him to commit a criminal act that, if discovered, would cost him that license and drive him out of his profession.

If Margolies was disappointed that Lewis would not do this bidding, still, the private detective had served a purpose. He had noted a few strange things about Barbera and her behavior, and he knew that Margolies was concerned about her and about her honesty and loyalty. Thus, should Margolies ever need a witness to testify that, as early as the spring of 1981 if not before, Irwin Margolies had been suspicious of his comptroller, he had one.

So Margolies, with Oestericher’s help, was weaving a web to entrap Barbera. He had what he thought was solid evidence—on the surface, anyway—in the form of the Merrill Lynch slip, that Barbera had made away with nearly $800,000. He had Lewis’s report and Lewis’s memory of what he had seen and been told. And there was more. In the spring of 1981, the diamonds turned over to Margolies and Candor by Van Mopes had disappeared, and so had the diamonds turned over to Margolies by Oxenberg. Margolies was concocting evidence to show that it was not he but Margaret Barbera who had made away with them, and not only them but also Candor’s entire inventory of diamonds, worth, he would claim, about $2.5 million, and she was holding them for ransom, demanding an immediate payment of $100,000 in cash for their return.

So Margolies was prepared to turn all the blame for all that had happened, to Maguire and everyone else, on Barbera. He was sure he had covered every aspect, that nothing could touch him. It was not that he expected his scheme to tumble yet. He thought it still had a long way to go before anyone caught on, and that there still were millions more to be made.

And, then, suddenly, it all collapsed.