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Why I did not go to jail (2014)

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Re: Why I did not go to jail (2014)

#51

Post by chki »

Meekro wrote: post #32
PragmaticPulp wrote: post #22

Earlier quoted context omitted.

> Out of a political desire get the big bad rich people we have in the process turned every executive of a sufficiently complex operation into an unwitting criminal. Yet we only saw a small number of arrests come out of the 2008 housing crisis, despite widespread fraud. The few cases that were successfully prosecuted involved 9 and 10 figure fraud operations. At the core of the issues is the idea that ignorance of th…

"Ignorance of the law is no excuse" is not a just principle when the laws are so numerous and incomprehensible that everyone is always ignorant of the law. Plenty of people just end up getting bad legal advice, even when they thought they were paying top dollar for a good quality law firm.

In some jurisdictions (I can only speak for Germany with some authority) if you've made a serious effort to get legal advice on a complicated topic and the legal advice was wrong this will (probably) mean that you're not guilty of a crime caused by the bad legal advice. Civil liability is a different topic obviously.

(But the "probably" is there for a reason: it really does depend on the specific topic at hand and whether you actually tried hard enough to comply with the law)

Re: Why I did not go to jail (2014)

#52

Post by ChrisArchitect »

dang wrote: post #17

If curious, past threads: Why I Did Not Go to Jail (2014) - https://news.ycombinator.com/item?id=18026790 - Sept 2018 (152 comments) Why I Did Not Go to Jail (2014) - https://news.ycombinator.com/item?id=11240717 - March 2016 (13 comments) Why I Did Not Go To Jail - https://news.ycombinator.com/item?id=7191642 - Feb 2014 (182 comments)

ya, curious why this has to be submitted over and over

Re: Why I did not go to jail (2014)

#53

Post by emeraldd »

dang wrote: post #17

If curious, past threads: Why I Did Not Go to Jail (2014) - https://news.ycombinator.com/item?id=18026790 - Sept 2018 (152 comments) Why I Did Not Go to Jail (2014) - https://news.ycombinator.com/item?id=11240717 - March 2016 (13 comments) Why I Did Not Go To Jail - https://news.ycombinator.com/item?id=7191642 - Feb 2014 (182 comments)

I thought I'd read this before. Still, there's this little tidbit that bears repeating:

    Secondly, I would regularly give a speech to the finance employees that went like this:
    “In this business, we may run into trouble. We may miss a quarter. We may even go bankrupt, but we will not go to jail. So if somebody asks you to do something that you think might put you in jail, call me.”

Re: Why I did not go to jail (2014)

#55

Post by dan-robertson »

yetanothermonk wrote: post #27

Did the PwC auditors have skin in the game? Do they have to stand by their decision when questioned or is it just a stamp of approval?

PwC are a big company and probably are pretty good at avoiding liability for themselves. Once upon a time companies with a partnership structure (eg law firms, accounting firms, private investment banks) were legally partnerships. In a partnership, partners have unlimited joint and several liability, which means that every partner could be held liable to an unlimited amount for anything any partner (or the partnership) did. I think this encouraged partnerships to avoid being liable or doing illegal things. These days there is a legal structure called a limited liability partnership (in the U.K. this was designed specifically for the big accounting companies like PwC) and true partnerships are less common.

It’s not obviously a bad thing, unlimited liability is pretty rare these days (people have unlimited liability but usually act through limited liability companies. Lloyd’s underwriters (used to?) have unlimited liability. I can’t think of other examples. Maybe partnership structures were good for keeping people honest but I don’t really understand why a partnership is different from an LLC, and I feel like they don’t scale well to large organisations.

Re: Why I did not go to jail (2014)

#56

Post by thaumasiotes »

phnofive wrote: post #11
jancsika wrote: post #3

Toward the middle, referring to author's very trusted counsel: > “Ben, I’ve gone over the law six times and there’s no way that this practice is strictly within the bounds of the law. I’m not sure how PwC justified it, but I recommend against it.” Toward the end, about the CFO's sentence ostensibly for breaking the law referred to above at another company: > Once the SEC decided that most technology company stock opt…

The enforcement and form of securities laws is beyond me, but I think Ben’s point is that Michelle went to prison for a crime she didn’t know she was committing and had checked [citation needed] with PwC. I agree it’s not arbitrary, but it does seem a bit unfair.

> I think Ben’s point is that Michelle went to prison for a crime she didn’t know she was committing and had checked [citation needed] with PwC.

The article is written that way, but that view contradicts all the facts. As summarized in the other comments:

- Really large numbers of executives were guilty of the same conduct described in the article. They didn't go to jail.

- Michelle was not charged with anything related to the conduct described in the article. She was charged with evading her personal taxes.

It seems unlikely that she had PwC audit her personal taxes. So the main point of the article seems to be that Ben Horowitz wrote it without bothering to learn what had happened.

Re: Why I did not go to jail (2014)

#58

Post by mc10 »

ChrisArchitect wrote: post #52
dang wrote: post #17

If curious, past threads: Why I Did Not Go to Jail (2014) - https://news.ycombinator.com/item?id=18026790 - Sept 2018 (152 comments) Why I Did Not Go to Jail (2014) - https://news.ycombinator.com/item?id=11240717 - March 2016 (13 comments) Why I Did Not Go To Jail - https://news.ycombinator.com/item?id=7191642 - Feb 2014 (182 comments)

ya, curious why this has to be submitted over and over

Not everyone here has actively followed HN since the last time it was posted (2018). I found this post to be interesting.
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