Hacker News Board Hacker News, browsed like a classic message board
Live data from Hacker News

SEC charges App Annie and its founder with securities fraud

sec.gov

Post reply on HN
Print view View original

11–20 of 42 posts

Re: SEC charges App Annie and its founder with securities fraud

#11

Post by derefr »

JumpCrisscross wrote: post #9
ajsharp wrote: post #4

Sub headline more relevant than the headline: "Company Will Pay $10 Million to Settle First Enforcement Action Against Alternative Data Provider". This is such an insanely good arb for App Annie it boggles the mind. Paying a $10mm vig to the SEC for a scheme that probably minted hundreds of millions in revenue from hedge funds is a no brainer. If the SEC actually wanted to disincentivize future bad actors they'd pros…

> If the SEC actually wanted to disincentivize future bad actors they'd prosecute rather than issue hilariously petty fines The SEC can't prosecute. They can only make criminal referrals to the DoJ.

Nothing has happened here that breaks a regulation under which a civil suit can be brought?

Re: SEC charges App Annie and its founder with securities fraud

#12

Post by JumpCrisscross »

derefr wrote: post #11
JumpCrisscross wrote: post #9

Earlier quoted context omitted.

> If the SEC actually wanted to disincentivize future bad actors they'd prosecute rather than issue hilariously petty fines The SEC can't prosecute. They can only make criminal referrals to the DoJ.

Nothing has happened here that breaks a regulation under which a civil suit can be brought?

> Nothing has happened here that breaks a regulation on which a civil suit can be brought?

That's what this announcement is. The SEC charged them. They settled. The investigation, meanwhile, provides documentary evidence for some of the wronged to pursue claims against the wrongdoers.

Re: SEC charges App Annie and its founder with securities fraud

#13

Post by detaro »

lifeisstillgood wrote: post #8

So (getting my head round this) ... mobile app creators added an App Annie agent to their apps, which downloaded performance / usage data on their app to central servers. And App Annie promised not to sell that data to third parties unless it was "aggregated and anonymised". (Does App Annie pay the app creators for this?) App Annie sells this so people can work out which app to advertise on (the one with all the usag…

If Apple were to publish it, it wouldn't be confidential insider information. But they don't, so it is, so misusing it is a problem.

Re: SEC charges App Annie and its founder with securities fraud

#14

Post by JumpCrisscross »

ajsharp wrote: post #10
JumpCrisscross wrote: post #9

Earlier quoted context omitted.

> If the SEC actually wanted to disincentivize future bad actors they'd prosecute rather than issue hilariously petty fines The SEC can't prosecute. They can only make criminal referrals to the DoJ.

I assume DOJ can't prosecute when SEC comes to a settlement agreement?

> I assume DOJ can't prosecute when SEC comes to a settlement agreement?

This is incorrect. The SEC has no prosecution authority. That means it can't prosecute. It also means it can't take criminal prosecution off the table.

Re: SEC charges App Annie and its founder with securities fraud

#15

Post by vmception »

ajsharp wrote: post #10
JumpCrisscross wrote: post #9

Earlier quoted context omitted.

> If the SEC actually wanted to disincentivize future bad actors they'd prosecute rather than issue hilariously petty fines The SEC can't prosecute. They can only make criminal referrals to the DoJ.

I assume DOJ can't prosecute when SEC comes to a settlement agreement?

That's not a good assumption. Parallel enforcement routinely happens. Sometimes simultaneously, sometimes later. Sometimes both are reported in the same places, other times one is not reported at all except on DOJ's own website or in more obscure court dockets. Sometimes there is no referral. Sometimes the DOJ passes on it.

Re: SEC charges App Annie and its founder with securities fraud

#16

Post by tcldr »

usmannk wrote: post #6

What I don't get is where does App Annie get its data? Implied here is that app developers hand it over, but what do they get in return? And is that the primary source of App Annie's data?

Yes, in most cases they hand it over for free in return for analysis tools for viewing their own data.(Charts, filters, etc.)

This was a pretty big benefit when all Apple offered was an unwieldy CSV broken out into line items for each country, but less so today.

Re: SEC charges App Annie and its founder with securities fraud

#17

Post by vmception »

> App Annie and Schmitt assured companies that their data would be aggregated and anonymized before being used by a statistical model to generate estimates of app performance. Contrary to these representations, the order finds that from late 2014 through mid-2018, App Annie used non-aggregated and non-anonymized data to alter its model-generated estimates to make them more valuable to sell to trading firms.

Nice to see the government making a statement about this pretty known practice. When the government doesn’t do anything people think its a tolerated practice. Its better for the government to even lose if it allows for the position of the administration to be made clear.

Re: SEC charges App Annie and its founder with securities fraud

#18

Post by spaetzleesser »

outworlder wrote: post #7
ajsharp wrote: post #4

Sub headline more relevant than the headline: "Company Will Pay $10 Million to Settle First Enforcement Action Against Alternative Data Provider". This is such an insanely good arb for App Annie it boggles the mind. Paying a $10mm vig to the SEC for a scheme that probably minted hundreds of millions in revenue from hedge funds is a no brainer. If the SEC actually wanted to disincentivize future bad actors they'd pros…

Yeah. At those levels, it's essentially a tax.

It seems that’s pretty much by design these days. Most fines are not high enough to be a real deterrent.

Re: SEC charges App Annie and its founder with securities fraud

#19

Post by tcldr »

lifeisstillgood wrote: post #8

So (getting my head round this) ... mobile app creators added an App Annie agent to their apps, which downloaded performance / usage data on their app to central servers. And App Annie promised not to sell that data to third parties unless it was "aggregated and anonymised". (Does App Annie pay the app creators for this?) App Annie sells this so people can work out which app to advertise on (the one with all the usag…

It’s the app’s financial data. Not usage data.

App developers would keenly sign up for this to get analysis and visualisation tools of the financial reports provided by Apple.

At the time App Annie came about all that Apple provided devs with was a CSV broken down into line items per country.

A bunch of companies made paid for visualisation and analysis tools/saas for this data but then app Annie had the bright idea of offering it for free and using the data to create aggregated (or not) intelligence tools.

Re: SEC charges App Annie and its founder with securities fraud

#20

Post by gh123man »

Not directly related but when I was releasing an iOS app recently - App Annie made me realize how "pay to win" building apps is these days. You know a service is expensive when there is only a "contact sales" button on the homepage.

It's impossible for an indie dev to afford the data they provide, and gives a massive SEO/keyword ranking edge to the larger companies that pay for the subscription.

Post reply on HN