Former Netflix executive convicted of receiving bribes from contractors • Hacker News Board

Re: Former Netflix executive convicted of receiving bribes from contractors

#251

Post by ugwigr » Tue, Oct 19, 2021, 6:46 PM UTC

batch12 wrote: post #242

ugwigr wrote: post #197

Earlier quoted context omitted.

in the comment? how many people would read his comment versus the subject line? Also the fact that he can fundamentally change what a user posts and then choose whether or not to disclose it in comment section is a flaw.

I wholeheartedly disagreed until I saw your point (I think). The post still has your name beside it and you disagree with someone changing your words. While I don't find it a big deal with this, I kinda agree in spirit. Maybe the poster name should be changed too. However, folks would then be upset about not getting their sweet, sweet karma.

ok. what did you disagree with if not my point? I do not care in the least bit about HN's karma

Re: Former Netflix executive convicted of receiving bribes from contractors

#252

Post by hikerclimber1 » Tue, Oct 19, 2021, 6:46 PM UTC

tptacek wrote: post #43

The DOJ press release is clearer than this article is: https://www.justice.gov/usao-ndca/pr/former-netflix-executiv... Some fun details: Kail did his criming through a shell LLC he set up called "Unix Mercenary". He took between 10-15% of the total billings for each of the companies he hooked up with this scheme. None of those companies were charged (more's the pity). They got him on mail fraud, wire fraud, honest se…

What about former Wells Fargo ceo? He was a crook and is still allowed to be advisor to some financial firm.

Re: Former Netflix executive convicted of receiving bribes from contractors

#253

Post by ugwigr » Tue, Oct 19, 2021, 6:46 PM UTC

Oddskar wrote: post #223

ugwigr wrote: post #197

Earlier quoted context omitted.

in the comment? how many people would read his comment versus the subject line? Also the fact that he can fundamentally change what a user posts and then choose whether or not to disclose it in comment section is a flaw.

How astute of you to observe that HN does not always hold your hand.

why would i want HN to hold my hand?

Re: Former Netflix executive convicted of receiving bribes from contractors

#254

Post by kiklion » Tue, Oct 19, 2021, 6:48 PM UTC

nkrisc wrote: post #173

LanceH wrote: post #151

Earlier quoted context omitted.

> one of those companies were charged (more's the pity). I understand the sentiment that "it takes two", but I'm of the opinion that it's the one accepting bribes that is the root cause of the problem. It is the people accepting bribes who are taking from their company, university, or government and creating a pay to play market.

If there are no repercussions for paying a bribe, then the optimal play is to indiscriminately offer bribes to get what you want while taking on none of the criminal liability.

Add a reward for whistleblowing on people accepting bribes?

Then it’s optimal to offer bribes indiscriminately, just to turn around and report them for accepting.

Re: Former Netflix executive convicted of receiving bribes from contractors

#255

Post by throw4823442 » Tue, Oct 19, 2021, 6:49 PM UTC

numbsafari wrote: post #44

csmythe15 wrote: post #2

Hey, I'm the author of the article -- just wanted to point out that what made this story interesting to me is the implication that this kind of conduct could be very widespread. Prosecutors definitely hinted at that. If anyone knows of any similar stories, I'd be very interested in hearing them. christie.smythe@businessofbusiness.com

The amount of "I don't get why this is wrong?" going on in this thread would seem to support the prosecutors' view that this is a widespread practice. Long ago, before Dotcom went Dotbomb, I worked for a firm where the CIO was being paid kickbacks by our hardware reseller. He was terminated for other reasons and, shortly after he left, our head of network ops got a call from the distributor asking where they should s…

I used to work for a company that actively sought out and hired the adult children of high level executives.

Even those that weren't very competent were hired since if they were part of the same Ivy League alumni network.

I have no knowledge of the business dealings but the company definitely appeared to benefit from having those connections.

Re: Former Netflix executive convicted of receiving bribes from contractors

#256

Post by jacquesm » Tue, Oct 19, 2021, 6:57 PM UTC

ugwigr wrote: post #250

jacquesm wrote: post #210

Earlier quoted context omitted.

Entitlement is a flaw.

yes it is, captain obvious. now what is the entitlement you allude to?

That you expect HN to work the way you want it to, instead of the way it already worked when you joined. You've been here 8 years, enough time to familiarize yourself with what's in the package. Besides that, a moderator going out of their way to mention that they have made an edit to your post, as well as specifically what edit they made is more than you could reasonably expect, and you already have that. Anything over and beyond that is pure entitlement.

Moderator time is more precious than your time, if you feel that you've been wronged then you could have just said what you thought was wrong rather than to demand a fix to your liking. This is further amplified by the fact that you have a major stake in the property whose link you posted here. Your website, your rules, HN -> HN's rules.

Re: Former Netflix executive convicted of receiving bribes from contractors

#257

Post by perfecthjrjth » Tue, Oct 19, 2021, 6:59 PM UTC

This is very common in many non-FAANG companies. The way these guys do it is to set up a third party staffing company, say X, owned by relatives and friends, then buy services (usually contractors) through this third party company. Usually, large companies have some vendor management tool. Here, the hiring manager picks candidates that come from X.

When I was working at AT&T in New Jersey, my manager always hired contractors from one third party company, which is owned by the wives of his brother (then another ATT employee) and other ATT employee. Eventually, many managers colluded with this particular third party company so much so that other third party staffing companies couldn't place any people.

So, these staffing companies complained to the Ethics department. ATT Legal started investigation, and fired my manager, his brother (another employee), another guy. They couldn't do much further due to these reasons. (a) the staffing company is owned by the wives of the two employees (b) the staffing company is NOT the direct vendor of ATT. The primary vendor is another entity, who takes $1 per hour per candidate.

This kind of fraud is so common in this industry.

Re: Former Netflix executive convicted of receiving bribes from contractors

#258

Post by jacquesm » Tue, Oct 19, 2021, 6:59 PM UTC

mbesto wrote: post #243

jacquesm wrote: post #99

Earlier quoted context omitted.

We always check the corporate registries to see if any of the legal entities the execs of a company are related to are making substantial turnover from either the company we are looking at, or a subsidiary. In 200+ DDs this has happened a handful of times. So I would not say it is a common thing but it definitely does happen, and often enough that we feel the need to at least try to establish if it is the case during…

> We always check the corporate registries to see if any of the legal entities the execs of a company are related to are making substantial turnover from either the company we are looking at, or a subsidiary. In 200+ DDs this has happened a handful of times. Just to add a few points: - This is much easier to do in Europe where entities are more public. - I regularly see (probably 1 out of 20 deals) companies where th…

A conflict of interest is one thing, but as long as it is disclosed to all parties who might be on the downside of that conflict it need not be a problem in and of itself (but it still could be, and may very easily become one).

An undisclosed conflict of interest is always a problem.

Re: Former Netflix executive convicted of receiving bribes from contractors

#259

Post by camgunz » Tue, Oct 19, 2021, 7:02 PM UTC

nilsbunger wrote: post #94

spenczar5 wrote: post #62

Earlier quoted context omitted.

Thanks, this is indeed a better source. A lot of people here are saying this is incredibly common which is frankly pretty surprising to me. Does it really happen through shell LLCs? I am definitely aware of execs prioritizing startups they've invested in, which is... not a great look. But this seems to be a different thing. Kail wasn't an investor. He explicitly drafted agreements that paid him a fraction of the mone…

People often set up an LLC for their consulting thinking it will help with 1) taxes and 2) liability. But neither of those are quite right: 1) the same tax deductions are available on your normal schedule C 2) while acting on behalf of your LLC you’re still personally liable for your actions (let alone your illegal schemes).

It can depend and IANAL buuuut I do have an LLC taxed as an S Corp, because you can dramatically reduce your tax burden. Essentially you buffer your money in your LLC and pay yourself a "reasonable salary". For example: maybe you earn $200k this year as a software contractor. You go to glassdoor and find that mean salary for software engineers is $96k/yr. You pay yourself $8k/mo (pre-tax), deducting payroll taxes and putting $1,650 (the max contribution) into a 401k. You also max out your 25% 401k business contribution at another $2k. Depending on state taxes, your total tax burden is something like 19%, after you've put $43,500 into retirement. If you didn't have an LLC, it'd be closer to 30% (or higher, ugh) with only $19,500 in retirement. In raw dollars, in this hypothetical you're down ~$24k.

Your business also gets tax breaks you don't, namely on (paying for your) health care, (paying for your) retirement savings, depreciating assets, (paying for your) salaries, food, travel, lodging, equipment, and services. Further, the cap on business 401k accounts is way, way higher [1]. The ability to sock away even more pre-tax money in a retirement account, and deduct your health insurance from your taxes is insane.

The biggest downsides, at least for me, have been the infra to get it all going. I have an accountant, a lawyer, a financial planner, and an army of online services that help me stay legal and paid up. That said, I'm still coming out ahead (e.g. they don't cost $24k/yr and you guessed it, startup costs are tax deductible), so the gains are there.

(I think paying taxes is patriotic, but I don't think it's reasonable to pay taxes on $200k of income for one year, and then only make $60k of income the next year. I also don't think it's reasonable for me to pay ~40% of my income in taxes while big corporations and the rich pay very little so....)

[1]: https://www.fidelity.com/learning-center/personal-finance/re...

Re: Former Netflix executive convicted of receiving bribes from contractors

#260

Post by menomatter » Tue, Oct 19, 2021, 7:03 PM UTC

omarhaneef wrote: post #65

One item seems to have caused a lot of confusion in the comments so I will take a stab at clarifying: It is perfectly legal for Netflix to ask for options or any other consideration in exchange for the contract. Companies do this sort of thing frequently. They know that merely signing a large contract with a large firm will increase the value of the contractor. It is not legal for someone working for Netflix to ask f…

What if you are a majority shareholder for a company? Say mark Zuckerberg asking for shares in companies providing service to Facebook? Is that legal? I'm guessing if it's part of the deal then it's legal.