Chapter 988 Underground Connection
Ves decided to look into the Neyvis Family first, because the KNG could never have grown so fast and with such momentum without the capital to back up their ambitions.
"Turns out the Neyvis Family has been laundering money for the Peace Association." He immediately recognized.
Money earned through illicit means couldn't be spent so easily. Running them through legitimate businesses helped underground organizations clean up their dirty money so they could spend it in the open without drawing an excessive amount of scrutiny.
"I guess it's too much to expect a bank on Bentheim to keep their noses clean."
To their credit, money laundering only formed a small proportion of the Industrial and Commercial Bank of Bentheim banking activities. It could even be said that the additional money injection allowed the ICBB to be more generous in investing in some of the local businesses with promise.
Through increasing the circulation of money in Bentheim's economy, the ICBB therefore formed a positive influence to the planet.
"Many other banks are probably engaging in similar schemes." Ves concluded.
The ICBB and the Neyvis Family's involvement in laundering money for one of the Big Three gangs of Bentheims made Ves apprehensive. If Ves ever damaged their business interests, then he'd be sure to draw the ire of the Peace Association.
Despite its seemingly benevolent name, the gang led by Three-Eyes Jackson could be just as cruel and ferocious of the Blood Claws!
"Pissing off the Peace Association is a very bad idea."
The Neyvis Family's relationship with the Peace Association extended to the Kadar-Neyvis Group. The mech company enjoyed a considerable amount of attention and protection from the gang since its inception!
"On top of the KNG's political, military and local connections, it also has a firm bond with Bentheim's underground!"
The sheer amount of connections the KNG forged almost made Ves faint. The more people cared about the company, the more people Ves pissed off if he dragged the company through the mud!
It seriously made him consider Leland's request yet again. Fabricating evidence in the absence of any legitimate evidence of treasonous behavior incurred numerous powerful enemies!
The calculus didn't seem very favorable to him. Was the backing of Flashlight really worth pissing off so many powerful figures?
After a moment of thought, Ves eventually narrowed his eyes in determination. "The only way to thread the needle is to dig up evidence of actual misdeeds. I don't believe a mech company of this size, background and history is completely clean. There has to be something fishy!"
The strange way that Kadar and Neyvis ran their company just didn't mesh well with Ves for some reason. The business of producing and selling lower-end mechs en masse pressured mech manufacturers into operating as lean and efficient as possible.
Yet the KNG seemed to reject that approach in their employment policies.
"Where do they get the money?" Ves asked himself.
The KNG spent lavishly on their employees, yet Marcella told him that she believed the company actually made a loss for every cheap mech they sold!
At such a time, the KNG should have tightened their belts and streamlined their operations, but Ves actually witnessed preparations for future expansions!
The company's cozy relationship with the Peace Association couldn't account for the entire shortfall. As Ves read through the intel meticulously gathered by the Blood Claws, the KNG only allocated around five percent of its profits and production capacity to servicing the Peace Association's needs.
This sounded like a reasonable proportion to which the KNG could just attribute at as 'inefficiencies' or 'spillage' in their administration. Handing over five percent of their stuff to a gang sounded like an unofficial industry standard for large companies.
In exchange for providing tribute, the gang subsequently extended their protection to the company. The documents provided by Raella frequently stated that none of the Blood Claws should ever touch the KNG and the Neyvis Family because the Peace Association would certainly retaliate!
Every business operating in an area where gangs held sway needed to accommodate the local powers. This was an unavoidable reality. Even his LMC continued to pay tribute to Walter's Whalers!
"In general, the KNG spends a lot more money than they get from the Peace Association. It wouldn't make sense for the gang to be generous enough to lose money to the KNG. Extra cash infusions by the ICBB can't explain it all because the bank needs to remain profitable as well."
This returned Ves to his initial question. Where did the KNG get the money to make up for their shortfall?
From the Ministry of Economic Development? Unlikely.
"Even if Marcella stated that the KNG has received generous subsidies and interest-free loans, the ministry is still a profit-seeking institution at heart."
From his logical deductions, MinEcDev wouldn't violate their basic interests when showing political favor to a particular company.
So where did that leave the company?
"Maybe I should look at their production capacity first."
He recalled the sights he saw when touring their manufacturing and repair complexes. He pulled up the reports he wrote after visiting the facilities and tried to draw mental maps for each of the four sites.
He loosely compared the figures of their claimed production capacity to how many mechs these complexes could actually pump out when running at full tilt.
This involved a lot of educated guesswork, but Ves was very familiar with how much time, manpower, resources and time it took to produce a single mech.
After he spent a full hour on projecting the theoretical maximum production capacity of each complex, he found out that there was around twenty percent left to spare.
"Either they lied when they told me their official production figures, or they are spending that twenty percent on producing off-the-books mechs." He guessed.
Ves ruled out the possibility that the complexes all ran below their maximum capacity. From what he personally seen of the hectic but tightly-run operations at all four sites, every available workplace saw an abundant amount of activity.
"The KNG is also in the process of expanding the facilities of all of their complexes. A company would only do so when there's no free capacity left to spare."
Of course, Ves might have made a miscalculation somewhere and overestimated the effective production capacity of the KNG's complexes, but he didn't think so. The company was too well-run! The productivity of their well-remunerated employees was near the top of the local industry standard!
Perhaps the key to answering the question where the KNG made up their shortfall was to look at how they made use of this twenty percent production capacity. Perhaps five percent could be attributed to providing tribute to the Peace Association, but where did that leave the remaining fifteen percent?
Ves simply didn't believe that a tightly-run company like the KNG just left that fifteen percent on the wayside!
Even so, they could have spent that fifteen percent production capacity for anything, from accumulating lots of spare parts to pad their inventory to selling more off-the-books mechs to various the various gangs in Bentheim.
"For the coming days, I should spearhead my investigation into finding out where this spare capacity is being spent."
He did exactly that as he revisited the manufacturing complexes in his capacity as a liaison mech designer.
Of the four complexes, the KNG allocated the least amount of military production at their Dorum Complex.
Therefore, Ves could not visit this facility with the excuse that he was overseeing the production of mechs for the Mech Corps seeing as there was none there.
Nonetheless, visiting the Hasten, Ansel and Mosville Complexes under Jeff's constant company didn't leave Ves with enough liberties to dig in too deep in areas that had nothing to do with the production of military mechs.
It was inspiring to Ves to see how the KNG handled the production of so many different kinds of military mechs. The Mech Corps imposed strict standards on their production, something which Ves used as an excuse to make a thorough inspection in this area.
He reviewed the records, interviewed key personnel and spent hours observing the work being done on fabricating the mechs destined for military use.
Besides doing his due diligence as a representative of the Mech Corps, his deep inspections also provided more data points which he used to corroborate his estimation of the KNG's true production capacity.
Each time he returned from his visits and revised the numbers, his initial conclusion didn't sway, though it trended downwards a bit. "There's around ten to fifteen percent spare capacity lying around."
It different from site to site. The company ran a very tight ship at the Haston Complex. As the center of production of all of their cheap, low-margin mechs, it was very important for the KNG to avoid unnecessary expenses.
Besides paying the Haston mech technicians a lot more generously than their competitors, the company generally did a good job keeping the Haston Complex running smoothly.
The Ansel Complex on the other hand fell somewhere in the middle. The highly capable Ansel mech technicians ensured that every spaceborn mech that rolled off the production lines adhered to a high standard of quality. However, they tended to be a bit too perfectionistic about their work and didn't deliver mechs as fast as possible.
"Even so, the very low rate of errors means that the Ansel Complex doesn't have to go back to fix them. It's rather inspiring to see them work."
Ves dreamt of running the LMC's Mech Nursery like the KNG's Ansel Complex even as he decried the cost. Still, he learned so many lessons on how the KNG ensured a high volume of production of many different mech models at a time while maintaining an excellent level of quality. Even if he didn't apply all of the practices in the LMC, just a handful of clever methods would be enough to raise the Mech Nursery's efficiency as it slowly expanded its scope of production!
Compared to the large and established Haston and Ansel Complexes, the Mosville Complex raised the most questions to Ves. As a hybrid site dedicated to producing spare parts and servicing heavily-damaged mechs, the variety of stuff going in and out was extremely hard to track.
According to the intel gathered by the Blood Claws, the Peace Association's influence here was the greatest.
"Lots of mechs go in and out. Lots of parts go in and out. Lots of materials go in and out." Ves described his observations of that complicated location. "The higher the complexity, the higher the level of confusion among the workers. Hardly anyone there has a total picture of what goes on there, including the residential mech designer in charge."
More stuff going in and out meant more openings to fudge the numbers or smuggle things out without drawing attention.
The main complication here was that the highly complex supply chains running through the Mosville Complex prevented any single person from acting out without permission. In order to divert a significant amount of spare capacity to off-the-books activities, it required the collusion of at least dozens of people, ranging from mech technicians to the security guards in charge of monitoring the facilities for impropriety.
"Are all of them in it?" He asked himself.
Probably not. If he ran something like this, he would have limited most of the shady activities to a trusted work crew.
As a fairly new addition to the KNG, the personnel working at the Mosville Complex consisted of a mix of old hands and recent hires from the city. When Ves looked over each work crew, he found one large group of mech technicians to consist almost entirely of old hands from Neyvis Mechs before the merger.
An experienced chief technician called Errel Nyquist headed this team of experienced mech technicians.