CEO of Kubient sentenced for fraud | Hacker News Reader

CEO of Kubient sentenced for fraud

arstechnica.com

167 pointspseudolus52 comments

"CEO of AI ad-tech firm pledging “world free of fraud” sentenced for fraud"

Classic of the genre.

> Revenues for the first quarter of 2020 were shown as $1.38 million, a huge jump from $177,635 in Q1 2019, thanks to "two enterprise customers" that "successfully beta tested KAI."

TL;DR: Their revenue was the result of round-tripping spending through a partner company who agreed to “spend” the same amount of money back into Kubient. They created fake reports to show to auditors to cover up the synthetic revenue.

They generated fake revenue with the help of another company and then IPO-ed months later. Truly a sign of the times in that era of SPACs and other ridiculous market offerings.

When countries do this it's "real GDP growth"

GDP is a different and often bad measure.

Sounds a lot like most cryptocurrency exchanges.

This is not unheard of for the fraud-fighters to be fraudsters themselves even after reforming, in which the redemption arc becomes just another scam.

Barry Minkow

Frank Abagnale

it's always the ones you most expect

For once it's not crypto.

It isn't news that AI is the newest tech grift (and just as power hungry).

Sure, some few legitimate and cool uses. So much if it isn't though, and we're just getting started.

A new candidate for the running for being the Theranos of AI has just been found.

> Paul Roberts is due to serve one year and one day in prison.

What's the point of the extra day? Is there some kind of special procedure for people who get strictly more than a year?

Perhaps he committed fraud on a leap year

According to sixty seconds of googling[0], the extra day makes them eligible for sentence reduction for good behavior.

[0]: https://kmlawfirm.com/2022/06/23/whats-the-deal-with-a-year-...

Crimes can be either misdemeanors or felonies in the USA, and they are automatically considered to be the latter if the prison sentence is over a year in length. Therefore he might have been sentenced to the extra day to ensure that his criminal record includes a felony. This would prevent him from getting a job in finance, for instance, even after having served his sentence.

PS. I am not American, let alone an American lawyer, so don't take my word for it!

This is incorrect. In the federal system, while felonies are punishable by imprisonment over a year and misdemeanors by imprisonment up to a year, the important word is punishable - whether the crime is a felony or a misdemeanor is simply inherent to the charge, and if you are convicted, the nature of the crime doesn't change based on the imposed sentence. E.g. if you are convicted of a felony but receive a prison sentence of a year or less, you're still a felon - the charge doesn't just turn into a misdemeanor because you received a shorter sentence.

I wondered if that might be the case - thank you for the correction!

Small enough to fail and jail.

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