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Where is the fraud? Creditors are very aware of the interest rate environment and still chose to make the loans. Are you saying that Wework lied to creditors

Where is the fraud? Creditors are very aware of the interest rate environment and still chose to make the loans. Are you saying that Wework lied to creditors to obtain the loans? Because that would have to be true for it to be fraud. Investors and executives are allowed to take risks on behalf of the company because it is literally their company.

cryptica 7y ago
Just as one example, Wework is at least partially funded by Softbank which is a fund backed by the Saudi Public Investment fund. The Saudi Public Investment Fund is controlled by the Saudi government using regular Saudi people's retirement money, often without their explicit knowledge. If you pick any big startup which is losing a lot of money, it will likely be backed in a large part by public money; either through a national public fund or a superannuation or 401K fund. Money which was invested on behalf of regular people was taken from their retirement accounts which they were often legally obliged to contribute a percentage of their income to. For example, even in a progressive country like Australia, people are forced to contribute 12% of their income to a superannuation fund; the process is intentionally complicated to coerce people into choosing between a small number of large funds. It's fraud on a massive scale because the responsibility for the crime is highly divided such that any single act on its own is not a crime; they are only criminal when taken together and if you assume that everyone involved knew what they were doing.
cryptica 7y ago
Also, when a shell startup goes bankrupt, the biggest creditors are the banks that they took the loans from. By that point, the money which was loaned by the banks entered the financial system through executive's and investor's bank accounts (since they get huge bonuses and returns on their investments) and inflated away regular people's buying power (especially real estate markets). This inflation is felt by everyone and it's like stealing.

cryptica 7y ago

Just as one example, Wework is at least partially funded by Softbank which is a fund backed by the Saudi Public Investment fund. The Saudi Public Investment Fund is controlled by the Saudi government using regular Saudi people's retirement money, often without their explicit knowledge. If you pick any big startup which is losing a lot of money, it will likely be backed in a large part by public money; either through a national public fund or a superannuation or 401K fund. Money which was invested on behalf of regular people was taken from their retirement accounts which they were often legally obliged to contribute a percentage of their income to. For example, even in a progressive country like Australia, people are forced to contribute 12% of their income to a superannuation fund; the process is intentionally complicated to coerce people into choosing between a small number of large funds. It's fraud on a massive scale because the responsibility for the crime is highly divided such that any single act on its own is not a crime; they are only criminal when taken together and if you assume that everyone involved knew what they were doing.

cryptica 7y ago

Also, when a shell startup goes bankrupt, the biggest creditors are the banks that they took the loans from. By that point, the money which was loaned by the banks entered the financial system through executive's and investor's bank accounts (since they get huge bonuses and returns on their investments) and inflated away regular people's buying power (especially real estate markets). This inflation is felt by everyone and it's like stealing.