[sillysaurusx]

I just want to say, you have some of the most fantastic coverage of events like this.

It feels like having an investigative journalist on payroll. The delay between an Animats comment and this showing up in the news is significant. Thank you!

(I remember your comments about the CEO that forged pay stubs being similarly excellent. Someday it might be worth collating them. In the meantime, whenever Animats says CEO Foobar is going to prison, Foobar had better start mentally preparing themselves for the journey.)

[Animats]

It's just knowing some basic financial history. Crypto scams are not new kinds of scams. They're mostly scams from the 18th and 19th centuries, with a new paint job. "Extraordinary Popular Delusions and the Madness of Crowds" (1841), has the first time around for most of these bad ideas. Mass market scams first got going when newspapers appeared. At last, you could reach large numbers suckers at low cost. Before newspapers, scamming was a one-on-one in person thing.

We still have both mass-market and one-on-one scams, but now they can both be done remotely. There's not much originality. It's mostly the same old scams of a few standard types, sometimes in new packaging.

[sillysaurusx]

I find all of it so fascinating. I wrote up Wasendorf’s story just now, mostly out of curiosity: https://news.ycombinator.com/item?id=33565992

Stories like that are really interesting to dig into. They all seem to get caught because the world changes (audits happening via internet in Wasendorf’s case, the economy imploding and sinking Alameda’s risky investments, etc) rather than from any particular mistake. The mistake always seems to be that they started cheating in the first place, and then it was just a matter of time.

Of course, we only hear about the ones who were caught. It makes you wonder how many stories like this were swept under the rug — if Alameda had made money instead of losing it, FTX would probably still be online, even though they’d still be committing the same large scale fraud.

Anyway, thanks again for all this, and especially for all the detail you put in. (Your comment pointing out that SBF is firmly under the SEC’s jurisdiction was wonderful.)

[shorthistory]

I may have missed it-but where is the source/evidence that some(all) this fraud is under SEC's jurisdiction?

[sillysaurusx]

Right this way! https://news.ycombinator.com/item?id=33550020

[sillysaurusx]

By the way, that Wasendorf story (Animats’ second link) is quite interesting. He skimmed $200M by forging bank statements and was eventually caught only when the world switched to electronic auditing. Previously he was able to fool everyone by intercepting the snail mail: https://www.forbes.com/sites/walterpavlo/2012/07/13/pfgbests...

[neomantra]

Any delay is related to the window size, MSS, and the amount of un-ACKed data ;)