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> Okay, but what does corporate structure complexity have to do with fraud? Their point is that we can't look at those diagrams and determine if LB was more co

> Okay, but what does corporate structure complexity have to do with fraud? Their point is that we can't look at those diagrams and determine if LB was more complex than FTX, because we suspect that those diagrams weren't drawn with the same granularity. So it's possible (perhaps even likely) that LB was more complex than FTX, and this would be apparent if we were to compare diagrams drawn with the same granularity.

lazide 4y ago
The potential relation to fraud is that financial complexity can be used to obfuscate cash flows and a great many other things and hide malfeasance. Even if things like corporate officers and beneficial ownership info is easy to retrieve, having a Byzantine structure of entities can make it really hard to see the ‘one hand washing the other’ stuff, especially for outsiders. And corporate officers and beneficial ownership info is rarely easy to get when this is done offshore, like many of these were.
- baobabKoodaa 4y ago
  Not sure if you replied to the wrong comment by accident, but that has absolutely nothing to do with my comment that you replied to.
  - lazide 4y ago
    Nope, my comment is definitely applicable.
    - baobabKoodaa 4y ago
      Ok, care to explain? It seems to me that your comment concerns the connection between financial complexity and fraud (it's easier to conceal fraud when you have complex structures). My comment didn't concern that topic at all. My comment concerned "can we judge if A is more complex than B based on these 2 pictures". I said that we can't know if A is more complex than B, or if B is more complex than A, based on these 2 pictures. Your comment doesn't even mention the pictures. Nor does it attempt to draw any kind of conclusion about the comparison between A and B. Nor does it provide a general framework for drawing comparisons. So I don't see how it relates to what I said at all.
      - lazide 4y ago
        You quoted the section I was answering, and then went on that tangent yes. Which I figured was because you couldn’t see the connection, otherwise you would have quoted another section?

lazide 4y ago

The potential relation to fraud is that financial complexity can be used to obfuscate cash flows and a great many other things and hide malfeasance. Even if things like corporate officers and beneficial ownership info is easy to retrieve, having a Byzantine structure of entities can make it really hard to see the ‘one hand washing the other’ stuff, especially for outsiders. And corporate officers and beneficial ownership info is rarely easy to get when this is done offshore, like many of these were.

baobabKoodaa 4y ago
Not sure if you replied to the wrong comment by accident, but that has absolutely nothing to do with my comment that you replied to.
- lazide 4y ago
  Nope, my comment is definitely applicable.
  - baobabKoodaa 4y ago
    Ok, care to explain? It seems to me that your comment concerns the connection between financial complexity and fraud (it's easier to conceal fraud when you have complex structures). My comment didn't concern that topic at all. My comment concerned "can we judge if A is more complex than B based on these 2 pictures". I said that we can't know if A is more complex than B, or if B is more complex than A, based on these 2 pictures. Your comment doesn't even mention the pictures. Nor does it attempt to draw any kind of conclusion about the comparison between A and B. Nor does it provide a general framework for drawing comparisons. So I don't see how it relates to what I said at all.
    - lazide 4y ago
      You quoted the section I was answering, and then went on that tangent yes. Which I figured was because you couldn’t see the connection, otherwise you would have quoted another section?