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CEO of Cyber Fraud Startup NS8 Arrested by FBI, Facing Fraud Charges

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Re: CEO of Cyber Fraud Startup NS8 Arrested by FBI, Facing Fraud Charges

#141

Post by duncan_bayne »

caust1c wrote: post #10
joering2 wrote: post #5

Sounds like a witch hunt. Big corpo tries to get rid of competitor. And once again government destroyed someones life. Now that he cannot do his part anymore its so easy to proof he deceived investors because well he doesn’t have any numbers to show si yeah he was lying. And besides, who didn’t flex a slide or two to show future numbers how they hoped it will look instead of honest truth. If thats the case then DOJ h…

Take your libertarian dreams to international waters. Regulation exists to create opportunity, not destroy it. Unless you have facts to back up your claims, don't spread misinformation.

Their position isn't Libertarian.

I'm a Rand quoting free market extremist, and I'm A-OK with this guy going to jail for fraud. Fraud is, after all, morally equivalent to physical coercion.

On a related note, most people who heap scorn on Rand seem to have missed the fact that many (most?) of the major villains in Atlas Shrugged are corrupt businessmen.

Hang 'em high.

Re: CEO of Cyber Fraud Startup NS8 Arrested by FBI, Facing Fraud Charges

#142

Post by stordoff »

joering2 wrote: post #82
joshgachnang wrote: post #12

Earlier quoted context omitted.

I don't think every startup CEO is falsifying bank statements to show millions more in income to their own finance department and investors than they actually have.

We simply don't know that. That's what DOJ accuses him of - now we need to wait to hear his side of the story (and his lawyers), unless of course you believe in USA everyone is guilty without being proven of committing said crime?

Something of a nitpick, but you can believe one person is guilty pre-trial without thinking everyone is - there simply needs to be enough evidence to pass your own burden of proof (there's no obligation on a person, outside of a jury, to uphold the 'beyond reasonable doubt' standard), or that you believe there is no room for reasonable doubt even at this stage.

A person unconnected to the case commenting online has far less of an impact than a court with the power to impose criminal sanctions, so using a lower standard of proof isn't particularly harmful.

Re: CEO of Cyber Fraud Startup NS8 Arrested by FBI, Facing Fraud Charges

#144

Post by xmodem »

liability wrote: post #63
PragmaticPulp wrote: post #43

Earlier quoted context omitted.

None of it makes sense in the context of a well-run business with proper executives in place. That’s because these frauds don’t operate like a well-run business. Usually, the upper management teams are extremely lean. The business is broken up into different silos such that few people can see the big picture. Each is led to believe they are a tiny fraction of the overall revenue, giving them the impression that the b…

Sometimes tribal/"team sport" group dynamics keep employees inline too. Executives can foster an "us against the world" mentality that blinds workers to that which is obvious to everybody else. When in this mindset, people have the ability to ignore even the most damning evidence. Here's an example: When Enron's CEO verbally attacked wall street analyst Richard Grubman for questioning Enron's accounting practices, En…

See also: Theranos.

Re: CEO of Cyber Fraud Startup NS8 Arrested by FBI, Facing Fraud Charges

#145

Post by [deleted] »

billyhoffman wrote: post #13

Being an executive at a (substantially smaller) SaaS startup I have no idea how having up to 90% of your revenue be fabricated could happen without others knowing: - where are the contracts corresponding to revenue? Yeah they are SaaS focused on SMB but this is a financial product, there will be contracts, NDAs, etc - if the majority of the customers are fake there is such little load on the system. How does engineer…

[deleted]

Re: CEO of Cyber Fraud Startup NS8 Arrested by FBI, Facing Fraud Charges

#146

Post by temikus »

billyhoffman wrote: post #13

Being an executive at a (substantially smaller) SaaS startup I have no idea how having up to 90% of your revenue be fabricated could happen without others knowing: - where are the contracts corresponding to revenue? Yeah they are SaaS focused on SMB but this is a financial product, there will be contracts, NDAs, etc - if the majority of the customers are fake there is such little load on the system. How does engineer…

A serious question - if I may. Where do you work? Sounds like a great company.

If you cannot respond - totally fair :)

Re: CEO of Cyber Fraud Startup NS8 Arrested by FBI, Facing Fraud Charges

#148

Post by maxden »

tdons wrote: post #88

An auditor was fooled while he was in the room watching while the ceo downloaded bank account statements (pages 10/11 of https://www.justice.gov/usao-sdny/press-release/file/1317641... ): d. As part of its due diligence process, the Audit Firm had an employee (the “Auditor”) conduct a physical site visit at NS8’s offices in Las Vegas, Nevada. The Auditor was directed by a more senior Audit Firm employee to have someo…

Sounds like they might have used the CEOs computer and perhaps he has a modified PDF report ready, downloaded the actual report but provided the altered version.

Agree with the other comments, the auditor should get the reports independently or use their own laptop to login/get the report.

Re: CEO of Cyber Fraud Startup NS8 Arrested by FBI, Facing Fraud Charges

#149

Post by unishark »

heartbeats wrote: post #64
jedberg wrote: post #28

> It seems ironic that the co-founder of a company designed to prevent online fraud would engage in fraudulent activity himself I don't find that ironic at all. Having worked in the security space for a long time, it seems like the best people in the business are the ones who would be great at committing the crimes if not for their own morality. Someone with a weak sense of morals could easily turn to evil.

Well, it is a cyber fraud startup. They didn't lie about that.

Yeah I first read the article wondering if cyber fraud was their business model.

Re: CEO of Cyber Fraud Startup NS8 Arrested by FBI, Facing Fraud Charges

#150

Post by roymurdock »

PragmaticPulp wrote: post #43
billyhoffman wrote: post #13

Being an executive at a (substantially smaller) SaaS startup I have no idea how having up to 90% of your revenue be fabricated could happen without others knowing: - where are the contracts corresponding to revenue? Yeah they are SaaS focused on SMB but this is a financial product, there will be contracts, NDAs, etc - if the majority of the customers are fake there is such little load on the system. How does engineer…

None of it makes sense in the context of a well-run business with proper executives in place. That’s because these frauds don’t operate like a well-run business. Usually, the upper management teams are extremely lean. The business is broken up into different silos such that few people can see the big picture. Each is led to believe they are a tiny fraction of the overall revenue, giving them the impression that the b…

Damn what a good reply. You must’ve been burned/seen some shit in the past.
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