Hacker News Reader

Comment by jlarocco | Hacker News Reader

The article says the judge called them out for not doing enough due dilligence.

The fact that they didn't do enough research doesn't mean it's okay to scam them, though.

Right, it doesn't change the direction of criminality. But nonetheless JPM is out that money regardless (maybe some will get clawed back, but probably most of it was spent). "I got scammed and the perp is going to jail" isn't a good excuse to tell your boss about you lost $175M, either.

Lessons abound here. Slow down on the tech habit folks, especially if you're an investment bank and not a VC incubator.

>JPM is out that money regardless ... probably most of it was spent

an MBA entrepreneur who starts a business and sells it to you for $175 million through normal channels is not likely to spend the money. this wasn't a fund wiring scam.

Unless they spent it on crypto or buying property in a country that won't let you claw it back.

She never had the full proceeds in her possession. Remember, she had investors. She was venture-backed startup. She likely only had somewhere between 10% and 25% of the equity at the time that she sold the company.

>> She never had the full proceeds in her possession. Remember, she had investors. She was venture-backed startup. She likely only had somewhere between 10% and 25% of the equity at the time that she sold the company.

How does this work for the VCs? Does JPMorgan claw back money from the VCs? What if the VCs distributed to their LPs...does money get clawed back from the LPs?

I wonder if there was an aspect to it where the scam was so audacious that they figured it wasn’t a scam. Like a “there’s no way they would generate millions of fake users which would obviously get caught post-acquisition, we must be missing something”

> The fact that they didn't do enough research doesn't mean it's okay to scam them, though.

True, if one does not mind risking the Orange Jumpsuit scenario

David O Leary and Mark Cuban checking in...(they sold companies for billions that were basically worthless when the ink dried)

I dont think they had to lie to Yahoo to do it though. Everyone believed in the froth of dot-com and plenty of dumb money just there for the taking from the likes of Yahoo. Kinda like today with all the AI froth.

> The fact that they didn't do enough research doesn't mean it's okay to scam them, though.

It is absolutely, 100% morally OK to scam investment bankers. It's just not legal.

Reply on news.ycombinator.com