Taylor Swift didn’t fall for FTX because she asked a simple question
finance.yahoo.com
finance.yahoo.com
I do not for a second believe that Taylor Swift herself asked this literal question. It is a summarization of the due diligence her team performed, as paraphrased by the attorney charging everyone else.
Take it with a grain of salt - this whole guy's legal case rides on the implication that all of the defendants knowingly had a duty to perform due diligence. And so proving that some celebrities like Taylor Swift backed out - not because of money or scheduling but because they understood that they were trading securities illegally - is important to his case.
Personally, I come down on the side of the defendants on this one. When Larry David was hired to do a superbowl commercial for FTX, how much was he really expected understand about securities law? Could we really argue he was in on the fraud? If he did a superbowl commercial for Chipotle we wouldn't expect him to perform his own health inspections.
It may have been her team... but it isn't unreasonable to believe that she is aware of the issues around promoting securities.
Someone on her team is financially savvy enough to know the questions to ask. It could have been a random member of her legal time, it could have been her father, it could have been her after a conversation with her father about it... or she may have been aware of those issues herself with a few decades of family conversations with a financial advisor.
But I also think it's a bit of hindsight snobbery to assume anyone was seriously looking FTX as a securities fraud risk in 2020. Maybe normal fraud, or even just a general ponzi scheme. It was an SEC-approved platform ~~that traded on the stock market!~~
The Business Insider link can give hints to that. As a trader, her father is required to do certain disclosures.
4)BUSINESS OR ACTIVITY NAME: 13 MANAGEMENT LLC
FOR PROFIT OR NOT FOR PROFIT: FOR PROFIT
INVESTMENT RELATED: NO
ADDRESS OF BUSINESS: NASHVILLE, TN 37203
NATURE OF BUSINESS: COMPANY OWNS 18 TOURING BUSES
YOUR POSITION. TITLE. ASSOCIATION: MANAGES AND PAYS EMPLOYEES
When someone offers you $100 million out of the blue to endorse them, that should trigger red flag alerts, especially for someone like Swift who zealously protects her image. It's likely that someone on her legal team pointed out the securities issue to her during a briefing, and she brought it up during negotiations with FTX (Rolling Stone notes that multiple members of the FTX C-Suite personally attempted to recruit her, and lawyers don't generally get involved in contract negotiations until an agreement in principle has been worked out.)
Again, in pretty much every other celebrity endorsement deal, you are not personally on the hook if it turns out the company screwed up or defrauded people. It's just very unlucky for the defendants that the product turned out to be a security which is has special and arcane rules, instead of just made of asbestos by slave children, I guess.
It's more than plausible that tons of people in Taylor's orbit tried to involve her in various crypto schemes, and either her dad someone on her team introduced her to the concept of unregulated securities (if she wasn't already aware - in interviews at the start of her career - when she was a teenager - she would say if music doesn't work out, she was going to go into finance).
A lot of entertainment industry celebrities are dumb as a bag of rocks. Others are terrifyingly smart. Ms. Swift strikes me as the latter
That's awful. Having a technical skill shouldn't be seen as a negative. Is this due to something specific to this pop star's audience, or does it apply more generally to celebrities outside of tech?
If she'd learned a better language, maybe it would be seen as better? :)
Given that the "opaque SEC definition of security" has been one of the most-commented on aspects of cryptocurrencies for several years, it seems like it would be a basic thing for a financially savvy businesswoman to ask about.
pretty much every other celebrity endorsement deal, you are not personally on the hook if it turns out the company screwed up or defrauded people.
??? They definitely can be. It's been part of American jurisprudence for decades. The FTC even has specific rules governing endorsements....
You should have really heard the man I guess
"I was in the ad but I was telling people not to buy it!"
The ad ending:
>Q: Would you say is FTX an easy and safe way to go into crypto? Larry: Eeeaaaah I don't think so, And I'm never wrong about this stuff, never.
The ad ends with a don't be like larry, which ironically if you where like me and interpreted all marketing or ads by default as the double speak likes they are, you would just read as -be just like larry, avoid FTX-
IANAL, but yeah that'd be a fun defense strategy to behold to be on a real trial, very comically appropiate for larry's trial if there's ever one
It is very common for someone top of one's trade to command respectable knowledge and skill in another trade.
Einstein was a decent violin player. It wouldn't be a surprise if he asked some deep questions in musics in certain circumstances.
Talyor Swift has got to the top and sustained at the top of probably the most competitive business, and keeps her wealth growing. She has certainly financial knowledge and discipline. I am pretty sure she is capable of asking that question.
I don't think that's true. There are some popularized figures, especially ones who have become public figures through music, and then have had continued success, but those are just the pop stars. What about all the doctors or engineers who have found success in one area, and then think that automatically makes them experts in a different area, with disasterous results?
This seems...wrong.
[0]https://www.businessinsider.com/taylor-swift-avoided-100-mil...
Did those politicians ask any questions at all or just happily recieve the money, no questions asked, wink wink
Because that's not the SECs job. It may be FEC’s job to do something about that, and it may be current FTX management's job to do something about that, but its definitely not SEC’s job.
> Did those politicians ask any questions at all or just happily recieve the money
They weren’t from FTX (corporations can't donate to candidates) but from individuals, and often through cutouts specifically to conceal the actual responsible individual (SBF) to avoid the questions that would come, including from the recipients, about the pattern of donations.
Those would be campaign donations, which are not part of the SEC's responsibilities.
Also of all the crypto companies FTX looked the more legitimate one, with their political connections, pushing for regulation...
Smart girl
I have no idea what that means one way or another. But if someone with backers like FTX at their height of their game came and asked me to promote them for a lot of money, I probably would assume they were legit.
With AI tools this is doable already. If you're famous and need plausible denaibility to promote the next FTX just hit me up
lol
Additionally, do you have a source for the claim that her father was the actual person that "caught" this? I did a small search and did not find. If it is just a presumption based on his career, a more charitable take along these lines might be that she could have learned about securities from her dad sometime over those 30 years and thus could have not needed to consult him to know the question to ask.
It's not some obscure detail, it's one of the key risks of being involved in a new crypto offering as an investor, and I think most people posting here have read years of HN discussions about the relevant SEC positions. Ultra high net worth individuals - especially ones that have launched multiple business lines - are fairly likely to have heard about it. At least enough to play word association and ask someone to look into it for them.