A $50 million margin call? I'll short Wall Street.

Evan Miller arrived right on time.

At 10:00 a.m., the receptionist at Farstar Capital informed Isabella that a visitor claiming to be from the SEC was already in the waiting area.

Isabella went to pick him up herself.

The moment she saw Evan, her level of vigilance unconsciously dropped a notch.

He looks too young.

He was in his early thirties, tall and thin, wearing a dark gray suit that was clearly a ready-made garment from a chain store, with slightly wide shoulders. His tie was tied very tightly.

He was carrying a black briefcase in his hand, made of nylon and with a zipper.

In this office with its polished concrete floors, minimalist artwork, and every piece of furniture exuding an aura of "I'm expensive, but I won't tell you how expensive," he looked like a civil servant who had wandered into the wrong office.

Isabella noticed his eyes.

Those eyes seemed to hold a kind of stubbornness.

"Mr. Miller, please come with me."

Isabella led him through the trading room.

Neither Lin Tao nor Matt looked up—Isabella had instructed them beforehand not to show any unusual behavior.

She led Evan to the door of the main office, knocked twice, and then pushed it open.

"Boss, Mr. Miller from the SEC has arrived."

Lu Ze sat behind his desk, with a crude oil options position report spread out in front of him.

He looked up and glanced at Evan.

"Please come in."

Isabella went out and gently closed the door behind her.

Only two people remained in the office.

"Sit down." Lu Ze pointed to the chair in front of him.

Evan sat down in the chair. He placed his briefcase on his lap, unzipped it, and took out a plain yellow law notebook and a ballpoint pen.

This gesture made Lu Ze's lips twitch slightly.

On Wall Street, when someone sits across from you with a pen and paper, it usually means one of two things: either he is your lawyer, or he is there to investigate you.

But the way Evan took out his pen and paper didn't look like he was preparing for an interrogation; it looked more like a student preparing to take notes in class.

"Mr. Walker, thank you for taking the time."

Evan spoke up.

His voice was more composed than Isabella had expected, but it still carried a directness that had not been completely worn away by the bureaucracy.

"I know you're very busy."

"fine."

Lu Ze leaned back in his chair. "You say this is an informal exchange. Then I won't call a lawyer."

This made Evan visibly relax a bit.

"Yes, informally."

Evan said,

"I am not here today on behalf of any formal investigation by the SEC. There is no subpoena, no recording, and no record whatsoever."

"Then who do you represent?" Lu Ze asked.

The question was very direct, so direct that Evan's pen paused briefly on the paper.

"I speak for myself," he said.

Lu Ze looked at him.

This answer is extremely rare in the context of Wall Street.

When an SEC enforcement lawyer says "I speak for myself," it means that what he is doing is either a probing exercise authorized by his superior but not intended to leave a trace, or a private action he is taking behind his superior's back.

Judging from his eyes, Lu Ze leaned towards the latter.

"good."

Lu Ze said, "Then let's talk."

Evan wrote a date in his notebook: February 25, 2008.

"Mr. Walker, I'd like to start from the beginning."

He looked up. "In February of this year, there was an over-the-counter CDO transaction between Farstar Capital and Goldman Sachs involving 50 times leverage. This transaction later evolved into the famous Bear Stearns put option deal."

"Yes," Lu Ze said.

"During my investigation—"

"You're saying this isn't a formal investigation."

Lu Ze interrupted him.

Evan paused, correcting himself: "In my personal investigation, I noticed some... anomalies in that CDO transaction."

"What's wrong?"

"At the time, Farstar Capital's net assets were approximately $23 million. However, Goldman Sachs's qualification threshold for a 50x leverage ratio required a net asset value of at least $80 million."

Evan looked at Lu Ze, waiting for his reaction.

Lu Ze's expression remained unchanged.

"This means,"

Evan continued, "Either Farstar Capital submitted false asset documentation during the application process, or someone within Goldman Sachs tampered with the qualification review report."

"Which one do you think it is?" Lu Ze asked.

This question made Evan's pen pause on the paper for almost two seconds.

"I think it's the latter," he said.

Why?

"Because I checked the internal approval records of Richard Kleiman, the vice president at Goldman Sachs who was in charge of this deal at the time. He bypassed the risk control committee's review process and unilaterally signed off on the deal. Moreover,"

Evan's voice lowered further, as if he were talking about something he himself considered very important:

"The senior executive in charge of risk control at the time, a woman named Amelia Walker, left Goldman Sachs shortly after the incident. She received a very generous severance package."

"I tried to contact her."

Evan looked at Lu Ze.

"She refused all my requests to contact her. Her lawyer told me that she had signed a comprehensive confidentiality agreement and could not comment on any matters related to Goldman Sachs."

Lu Ze picked up the coffee cup on the table and took a sip.

"Mr. Miller,"

Lu Ze put down his cup. "What you just said sounds like an internal problem at Goldman Sachs, not a problem with Farstar Capital."

"Yes."

Evan nodded. "But my boss doesn't see it that way."

"Hobbes?"

Evan's pupils contracted slightly upon hearing the name.

He didn't ask Lu Ze how he knew his boss's name. On Wall Street, this level of information asymmetry is commonplace.

"Mr. Hobbs believes that the SEC's current investigation should focus on short sellers."

Evan used extremely careful wording.

He believes that Bear Stearns' collapse was at least partly caused by malicious short selling and the spread of market panic. Farstar Capital profited the most from that event and should therefore be the primary target of the investigation.

"He sent you to investigate me," Lu Ze said.

"He sent me to investigate you. Yes."

"Then, as you continued your investigation, you traced it back to Goldman Sachs."

Evan paused for a moment.

"Yes."

"Then what?"

Evan pressed his finger against the pen, and the pen made a very slight scraping sound from the plastic.

"Then, Hobbes told me that we could close the investigation into Farstar Capital."

The sentence lingered in the air for about three seconds.