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I’m a corporate fraud investigator. You wouldn’t believe the hubris of the super-rich

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Summary

This article is written by a corporate fraud investigator who has encountered many fraudsters, some of whom have been carried away with their own genius and concocted grander schemes. The article discusses the hubris of the super-rich and how the current economic environment encourages fraud and corruption. The article also discusses the role of perception, charm, and bullshit in concealing fraud and discusses the consequences of unchecked power in the corporate world. It also looks at the SEC's whistleblower program and how the post-Covid macro environment may lead to more investigations into corporate wrongdoing.

Q&As

What methods does a corporate fraud investigator use to uncover financial fraud?
A corporate fraud investigator uses financial reports, local filings, data sets, and social media to uncover financial fraud.

How can unchecked power enable corporate fraud?
Unchecked power can enable corporate fraud by allowing executives to make big promises they can't deliver, make savage cuts in lifesaving equipment, cheat emissions tests, or pretend they can monitor cancer from blood samples.

What is the role of perception in corporate fraud?
Perception plays a role in corporate fraud by allowing investors to believe the narrative of a hot start-up, even if it is not true.

How have recent economic trends contributed to an increase in corporate fraud?
Recent economic trends, such as low interest rates, have contributed to an increase in corporate fraud by lifting all boats, no matter how leaky.

What is the consequence of hubris in committing corporate fraud?
The consequence of hubris in committing corporate fraud is that the schemes get grander and the methods more flamboyant, leading to catastrophic consequences.

AI Comments

👍 This article provides an insightful look into the world of corporate fraud and corruption, and how the hubris of the super-rich can lead to disastrous consequences.

👎 This article paints a rather negative picture of the super-rich and implies that fraud is rampant in corporations.

AI Discussion

Me: It's about the hubris of the super-rich and how corporate fraud investigators are trying to expose it. The article talks about how fraudsters are often clever and cunning, but they eventually become overconfident and reckless. It also mentions how low interest rates and the current macro environment have enabled fraudsters to get away with their schemes.

Friend: Wow, that's really eye-opening. It's scary to think how these fraudsters are able to get away with their schemes and amass so much wealth. It also makes me wonder if there are other cases like this that we don't know about.

Me: Exactly. It's definitely concerning, but hopefully corporate fraud investigators will be able to uncover more cases and bring the perpetrators to justice. It's also important to remember that investors need to be more vigilant when they're considering investing in a company and to do their due diligence to ensure they're not being taken advantage of.

Action items

Research the SEC's whistleblower program and consider becoming a whistleblower if you suspect corporate wrongdoing.
Follow the news and research any companies that have been accused of fraud or corruption.
Learn more about the consequences of unchecked power and how to identify red flags in corporate practices.

Technical terms

Hubris: Excessive pride or self-confidence.
Fraud: A crime involving deception, especially for financial gain.
Cunning: Clever or skillful in achieving a desired end.
Charlatan: A person falsely claiming to have special knowledge or skill.
Red flags: A warning sign or indication of a potential problem.
Data sets: A collection of related data points or records.
Wirefraud: A type of fraud involving the use of electronic communications to commit a crime.
Unicorns: A privately held startup company valued at over $1 billion.
Emissions tests: Tests to measure the amount of pollutants emitted from a vehicle.
Whistleblower: A person who exposes any kind of information or activity that is deemed illegal, unethical, or not correct within an organization that is either private or public.
Phishing: A type of cyber attack that uses disguised email as a weapon.
Short-sellers: Investors who sell borrowed securities in anticipation of a price decline.
Tyrant: A cruel and oppressive ruler.
Vindicating: To prove or show to be just, right, or valid.
Macro environment: The external environment of a business, including economic, political, and social factors.