He broke an unwritten, cardinal rule, which is to never steal from the rich.
You just don't hear about them as much because someone going to jail for stealing $60K from a couple families from their church in a fake real estate scheme isn't as exciting as a massive fraud against JP Morgan.
I knew one local HVAC company where the office manager skimmed off six figures over something like 20 years before she got caught. Just slow and steady, never taking enough to be obvious, I guess. It happens more than people would think.
"She".
The name is "Charlie," but it's a young woman.
And, like another young woman, she stole from the rich, and got jailed.
She'll probably get a federal minimum-security prison (no fences and a golf course).
They aren't quite "Camp Cupcake," but they are a far cry from places like Leavenworth (I've known folks that have done time in both).
Right from the article
> Addressing the court before she was sentenced, Javice,
"she was" ...
The title even:
> Charlie Javice sentenced to seven years in prison for fraudulent sale of her startup
"her startup" ...
Kind of curious, how did you determine their gender? Guessing, saw the title on HN only without clicking on the link assumed it must be a "him"?
If you turn a profit no one cares (unless you're Shkreli, don't think his investors lost money, but he pissed off some politicians because he said the quiet parts out loud about how the pharma industry works), if you lose it's fraud.
When all the winners are doing it, hard to compete otherwise... not that it makes it right.
That was FedEx’s founder, Fred Smith. It wasn’t UPS
He only had $5,000 of funds remaining, which he gambled playing blackjack, so the potential loss to investors was small. He’d already lost almost all their investments through operating FeDex
At that point he had been stiffing his pilots on wages for weeks or months, and with many also paying fuel bills on their personal credit cards/checks, since many fuelers had canceled FedEx's accounts.
Yeah, $5K isn't a whole lot, but if I'm a pilot struggling to put food on my family's table, and the CEO takes company money to Vegas, I'm not thinking "Oh, but the investors" or "Sure, it's not that much money anyway".
I don't see why people (not saying you, in particular) see this as some heroic founder "risking it all". He wasn't. He was risking the company's "all", after asking the employees to suck up his mismanagement.
I agree. He was asking employees not to cash their paychecks sometimes. $5000 is inconsequential compared to that forced investment from employees and business partners
Outside of Bribery and ?SarBox? (Whichever regulation handles kickbacks, etc), I can't think of anything.
If you get investor money or get a loan on the basis of funding logistics investments, bet it on roulette red, and go bankrupt, I would expect you'd be looking at hard jail time for fraud.
So I'm thinking the crime would be nothing, because he was a winner, and the optics totally changed, and fraud relies on very subjective opinions of a jury.
I think you are definitely in a much worse place for a fraud conviction if you lose money.
https://techcrunch.com/2024/05/08/ftx-crypto-fraud-victims-t...
If I stole 1000 bucks from you 3 years ago and repaid 1080 back now, sure, you got some interest, but you still be pretty unhappy with not having access to that money. For some, lack of access to that money could have been extremely damaging.
If you want an accurate reflection, note how much of the crypto deposited went in, and then how much came back out after SBF lost it.
This would be like me depositing USD, someone stealing some of it, then you bragging the value went up because I have a larger quantity as measured in Venezuelan Bolivars. What actually happened is their % they recouped was less than 100 until you artificially change to an entirely different currency.
Losing the gains put SBF in jail for 25 years. Mothballed original comment was "So I'm thinking the crime would be nothing,".
What's the TL;DR? His wikipedia page doesn't make it obvious.
This made a bunch of powerful people absolutely enraged, as he was basically publicly bragging about jacking the ever living fuck out of the prices. Pharma companies do this but Shkreli would publicly say it and tell the truth that basically the other companies were doing it while pretending to be good people, and he was only being honest about it. Poor people were pissed because they were told they couldn't get their drugs (I'm unaware if the program that allowed uninsured people to get them for cheap was real or not), and the rich insurance people pissed because he was basically he was bilking them.
So they went back and discovered one or some of his other early enterprises weren't profitable, but that he had used money he made off his later pharma enterprises to pay back his earlier investors.
In trial, his investors testified they were happy with the situation, lost no money, and would invest with him again. But they still convicted him for fraud, even despite the 'victims' themselves did not believe they were defrauded. It didn't help that Shkreli is probably one of the most profoundly unlikeable people you can possible listen to, unless you're not bothered to hear a hyper-capitalist be honest about how they do business.
He would paint himself as a working man's hero, "I'm making insurers pay more so you can get your drugs cheaper", always avoiding the awkward questions of where the insurer's money came from and why premiums kept rising (note that I'm also not siding with insurers here, especially those who have implemented PBMs to leech money into their pockets). He basically treated the public as useful idiots who thought that insurance was paying more for their drugs out of ... charity? Goodwill? The money fairy?
Then there was also the fact that at least once (and to a slightly lesser extent, twice), he went to the FDA to block the approval of a new drug, arguing it shouldn't be on the market. Why?
Not because it was less effective than the market options - it had better results.
Not because it had more/worse side effects, complications and interactions - it had better results there too.
Not because it was prohibitive, or patenting or anything stifling to the market.
No, it was because Shkreli had recently purchased a manufacturer of one of those existing drugs and their portfolio, and had been in the process of ramping up his price gouging on that drug, i.e. "The FDA should block approval of this better drug because it limits my ability to profit from my 'worse' drug."
In this case the wife never called the cops, and then when the cops showed up she claimed she wasn't beat, and not only that she has no visible marks or bruises or anything.
And none of this is justifying any of it. Just showing how far outside of what we commonly see in fraud cases that actually get convicted.
While she committed fraud, I feel sorry for her because of her naivety. It must've been a sick moment when they asked to examine the data during due diligence. If she'd known that would be used for marketing integration so quickly, maybe she would have backed out of the deal.
She's not naive. She was told this was illegal and then did it still. She knew this was fraud.
It made me wonder what she was thinking when her $30M share landed in her bank account. "Whee, I got away with it", "it's their problem now"?
I don't think I would commit fraud, but if I did it for that amount, I would be on a flight to Malaysia or some other place with no extradition with the US!