> Index fund buyers don't read EPS, so the frauds are targeting the dumb active investors.

I'm not saying the buyer's do. The selection criteria of the index fund may include it.

> It's generally agreed that index funds are going to eventually destroy the stock market

Or, like I've been saying, companies will find says to adjust their figures to get selected for index funds. And then eventually implode, due to the cost of doing so, which in most cases is quite a lot, taking down the investors along with them.