Comment by vlovich123 | Hacker News Reader

Comment by vlovich123 | Hacker News Reader

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This is a confusing argument to me. Are you saying that structuring and smurfing should then be legal? All structuring and smurfing is is an attempt to make sure that financial transactions stay below the statutory reporting threshold.

Also, I think you’re conflating my statement which was meant to be prescriptive with a descriptive statement. I’m saying if structuring and smurfing are illegal in a financial context, MSFT doing so to skirt antitrust laws should be similarly illegal - if the laws don’t prohibit it, the laws should be updated. But I’m not a lawyer so it’s possible laws already prohibit it or MSFT violated some laws. Commenting in either direction on an information free article isn’t wise.

As for the spirit of the law vs letter of the law, that’s an ongoing debate as old as history. It’s personally weird to me to encounter letter of the law people given that the spirit of the law has a much richer history behind it to my view and seems more defensible. Some amount of rule lawyering is required, but violating the spirit of the law is a more robust legal principle that can withhold participants trying to find creative workarounds around the spirit of the law.

You picked a particularly bad example. Structuring is a notoriously bad law because innocent people make transactions that would be considered structuring all the time, and making it illegal has no legitimate purpose when the government could just use the aggregate amount of deposits over some period of time for its reporting threshold instead of the amount of each individual deposit. It's like creating a rule with a loophole that gets exercised through ordinary behavior, and then instead of closing the loophole they impose criminal penalties on the ordinary behavior.

But then you consider that it's used for civil asset forfeiture (i.e. law enforcement stealing money from innocent people without ever proving a real crime) and it suddenly makes sense:

https://www.washingtonpost.com/news/the-watch/wp/2014/03/24/...

Whereas with MSFT it's a different situation. There is nothing illegal or wrongful about depositing a large amount of money, there is just a heinous law that makes it illegal to do it in a common way. Whereas monopolizing a market is intended to be illegal regardless of how you do it, so there shouldn't be a way to structure things to monopolize the market without breaking the law. The way you're intended to comply with the law is by not monopolizing the market.

This is an easy asnwer.

With banking, structuring laws mean banks need to report any transaction over $10,000.

So if I need to send you $100,000 and s split it up into 11 payments so each payment comes under the $10,000 reporting limit that breaks the law because my payment was for $100,000 but i structured it to get around the $10,000 reporting limit.

If Microsoft approaches anit trust limits if it owns more than 50% of a company and buys 49% then no strucuturing took place as they only bought 49%. Now if they bough 10% in each of 6 different shell companies that they own such that they'd control 60% of hte company, then this is illegal as it works around the limits.

But owning up to the limit is perfectly fine as it doesn't in anyway break the law or work around it. That's the very reason for having a limit, to say you can go up to this limit, but not over.

I'm guessing you don't deal in finance at all as we deal with this all the time. You'll see funds owning up to 9.9% of companies to avoid the 10% reporting threshold. Again, nothing illegal here as the government has said they are perfectly fine with funds owning up to <10% of a company.

Ah I see, I was in two minds about including the quote but decided against it. I was talking about "Microsoft structured its minority stake in OpenAI in part to avoid antitrust scrutiny, The Times has reported. Microsoft also reached a deal in March to hire most of the staff of Inflection AI, another A.I. start-up, and license its technology. Because the deal was not a standard acquisition, it may be harder for regulators to scrutinize.", not what you wrote. Obviously they structure the deal to involve scrutiny; they aren't going to structure it to invite scrutiny; the deal is designed to avoid anything that would allow a random regulator to get involved. The Times is insinuating without cause.

I don't think you're in a position to bully Microsoft. I doubt they care about your opinion.

If you need to intentionally structure a deal to avoid scrutiny and have it described that way, it implies what you really wanted was much worse.

“We packed the goods in nondescript boxes to avoid scrutiny by the border guards…”

Scrutiny isn’t something you need to avoid as a big company if you’re not fucking around. The lawyers are there to handle the scrutiny, not to hide stuff from it.

> If you need to intentionally structure a deal to avoid scrutiny and have it described that way, it implies what you really wanted was much worse.

It doesn't. That is like saying that if someone structures their affairs to pay less taxes it implies that wanted to do something illegal. They had to choose some structure, they picked the safest and easiest one. In both the hypothetical tax case and the real MS case, I suspect.

The incentive is to choose structures that minimise regulatory engagement. The fact that MS is following incentives isn't a red flag. Not a green one either, it isn't interesting except as something that the NYTimes can hook insinuations on.

This is a funny discussion, because "structuring" has a very specific meaning when it comes to finance. It's about executing your financial transactions in a way that avoids regulatory scrutiny (for example sizing transactions such that they fall just under reporting thresholds).

Structuring is explicitly illegal in the US.

This is the point that vlovich123 was making, and given you totally missed it, it seems like you might not be familiar with what the term means in this context.

Sorry for being unclear on this, I should have quoted. But I'm not, and never was, talking about vlovich123's point in any comment in this thread. I didn't have an opinion on what vlovich123 said.

It does. You can't replace the X and Y in "Structuring X to avoid Y" and still end up with the same implication.

Structuring your business to avoid breaking the law is good.

Structuring your business to avoid some otherwise regular audits that would reveal whether you are breaking the law is obviously suspicious. One might think that there is a reason why getting audited might result in negative consequences for your business.

I think the issue here is the overloaded use of the term "structuring."

If I think I might be doing something that antitrust regulators won't like, so I hire a lawyer to tell me what I can do, and they tell me "you can buy up to 49.9% of this company," and I buy 49.9% of the company, that's fine. It's neither illegal nor unethical. It's also not "structuring" in the technical, financial sense, but a layman might say "you structured the deal to avoid falling afoul of regulation," even though it's the wrong use of the word. I think that's what's happening in this conversation (I have no idea about what MSFT actually did or didn't do, just the direction the conversation here is going).

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