4 ms·

Reminds me of my first "real" job, many many years ago. I was working at a metal pipe retailer, helping them switching from one ERP/CRM to another. While movin

Reminds me of my first "real" job, many many years ago. I was working at a metal pipe retailer, helping them switching from one ERP/CRM to another. While moving the inventory between the systems we decided to also check the real inventory. It turned out that due to incorrectly using the previous system, there was quite a substantial shortage compared to the company's turnover. Anyway, it had to be reported somehow to the shareholders... suddenly the management "remembered" that the previous team lead from the storage department has just left a few weeks ago, everything is his fault, they put all responsibility on him (without pursuing any further actions). Ahhh, I really don't like some thing.

caminante 3y ago
Sketchy. Metals warehousing is notorious for embezzlement/fraud. My hypothesis is that everyone assumes it's too obvious to check or hard to steal.
- teraflop 3y ago
  Matt Levine had a pretty entertaining explanation of a different incident earlier this year, involving futures contracts: > JPMorgan, which does not make batteries or cars, bought bags of abstract nickel years ago. It took delivery of that nickel, not in the sense that a truck full of nickel showed up on Park Avenue but in the sense that an entry was made, on the ledger of the warehouse, saying that the bags of nickel in Row X, Shelf Y now belonged to JPMorgan. > JPMorgan then used that nickel for its intended purposes for years. Those purposes were to write financial contracts referencing that nickel. The nickel worked perfectly well for those purposes — JPMorgan’s derivative contracts traded and paid off normally — for years, even though the nickel was not in fact nickel, just bags of rocks. > And then one day a warehouse worker, like, stubbed his toe against JPMorgan’s nickel and was like “hmm that’s not the sound nickel makes when you kick it” and opened the bags and found rocks. And then the [London Metal Exchange] dutifully reported that some nickel was not nickel, and JPMorgan’s nickel warrants were transformed into rocks warrants. But it’s all just a random accident? The purpose of JPMorgan’s nickel was not to be turned into batteries or cars, but to sit in a warehouse. It was doing a great job of that, until someone noticed! https://www.bloomberg.com/opinion/articles/2023-03-21/jpmorgan-had-some-fake-nickel https://www.bloomberg.com/opinion/articles/2023-03-21/jpmorg...
  - iancmceachern 3y ago
    Stuff like this leaves me wondering...is that bad? I mean it's bad from an honesty and ethics standpoint, but is what JP is doing honest and ethical? And the enemy of my enemy is my friend? The world is complicated
    - mandmandam 3y ago
      The same JPMorgan that financed Epstein, failed to keep mandatory records, "lost" 47 million emails and were fined nearly a billion dollars for spoofing metals markets? The JPMorgan that taxpayers "gave" a $12 billion bailout to? ... Probably not your friend, unless your 'net worth' is in the 8 figures range.
      - iancmceachern 3y ago
        Sorry, I meant the friend being whomever swindled JP and the enemy to be JP in my weird thought experiment
        orangepurple 3y ago
        JP could have purchased rocks and pretended it was nickel from the very beginning. Where is the Epstein client list?
    - deleted 3y ago
      [deleted]
    - bequanna 3y ago
      Well, this scheme temporarily added more “supply” to the tradable market which theoretically could have lowered overall prices some amount.
    - rz2k 3y ago
      For the net impact to the economy it depends on few things. What did suppliers do in response? If suppliers believed there was a nickel reserve that could potentially enter the market, they would be less likely to choose strategies such as constraining supply in order to increase prices which helps consumers of nickel. However, they also would be less motivated to store up surplus nickel of their own that would help alleviate natural shortages. The other thing to consider is that we think the nickel did exist at some point in time, so in this case crime did pay. Therefore the thieves' ill-gotten gains will have increased their capacity to carry out future scams.
- pixl97 3y ago
  In the past it was warehousing in general, itemized tracking these days has greatly increased how well we can track things. In the late 80s my dad was a transport manager for a large and well known company. They had recently moved to a newer computer system that greatly expanded the capabilities one had in data charting and comparison. He had the idea "Hey, if I identify where our floor losses due to damages are and minimize those it will probably lead to a nice bonus", but when he began running the numbers something was very very wrong. Losses in some classes of very expensive products were orders of magnitude higher than other assumed random damages. Start coupling this with other data like the regular reoccurrence of damages to these same categories of products and things get suspicious. Then adding in the data the damages always happened on particular shifts and suddenly whispers of the word fraud show up. Turns out a number of employees, middle managers, and a vendor where all involved in a kickback scheme that had been going on for years.
  - nullc 3y ago
    So did he get the nice bonus?
    - pixl97 3y ago
      A nice gold watch and no bonus even. Then the next year they internally announced to management they were going to downsize a good portion of the staff, but they couldn't tell anyone. So he left the meeting. Told everyone he managed, and never went back.
- ajsnigrutin 3y ago
  I was born in yugoslavia, so could be a local peculiarity. Wherever there was a large (communism, so government owned) company, if you needed something that company either had (raw materials) or produced, you just needed to find someone who worked there, and they would sell you whatever you needed. Friend works in iron works/steel company? Need steel sheets, just call him. Need some end products? Just call him. Need cement? Or cement blocks? Just call someone who works at a cement factory, he'll take a few blocks home every day, and after a week or two, you go to his house, pay and pick them up. It was never stealing trucks full of stuff, but with 1000+ workers, having 200, 300 workers that steal a bit every now and then (like pens and post it notes in the "west"), after a few years, you get whole neighbourhoods built using stolen bricks and cement, and all the fences were built out of iron rods, that were destined to become something else.
  - nextaccountic 3y ago
    And maybe this neighborhood wouldn't get built if it weren't for the stolen materials, so this form of corruption isn't necessarily a bad thing
dv_dt 3y ago
This makes me think about why new more accountable systems between companies sometimes fail in implementation. Sometimes the existing players are happy with the exploitable gaps in the existing system.
- baetylus 3y ago
  Great comment. Fun theory -- companies function on personal optics internally. When you sell software, you can get buy in easily if they can say "this'll make me look excellent to my boss" (and they have decision-making power/budget of course). Similarly, a boss will promote subordinates who will make him/her look better.
  - gottorf 3y ago
    Put another way, the incentives facing any single component of a greater whole does not always align with the incentives of the organization itself. In fact, you could say that a good measure of how well an organization is run is how closely those different incentives align.
    - maxbond 3y ago
      In economics, this is called the principle-agent problem. https://en.wikipedia.org/wiki/Principal%E2%80%93agent_problem https://en.wikipedia.org/wiki/Principal%E2%80%93agent_proble...
- deleted 3y ago
  [deleted]
gryn 3y ago
ah yes the old trick of converting praise to blame once someone leaves. every now and then I wonder how many things I'm being blamed for at my old jobs.
Waterluvian 3y ago
Last job I left I did say semi-sarcastically, “and now you can blame any bad thing on me for a while!” And they did from the numerous reports I got. It was amusing. I guess it’s soothing in a way.

caminante 3y ago

Sketchy. Metals warehousing is notorious for embezzlement/fraud. My hypothesis is that everyone assumes it's too obvious to check or hard to steal.

teraflop 3y ago
Matt Levine had a pretty entertaining explanation of a different incident earlier this year, involving futures contracts: > JPMorgan, which does not make batteries or cars, bought bags of abstract nickel years ago. It took delivery of that nickel, not in the sense that a truck full of nickel showed up on Park Avenue but in the sense that an entry was made, on the ledger of the warehouse, saying that the bags of nickel in Row X, Shelf Y now belonged to JPMorgan. > JPMorgan then used that nickel for its intended purposes for years. Those purposes were to write financial contracts referencing that nickel. The nickel worked perfectly well for those purposes — JPMorgan’s derivative contracts traded and paid off normally — for years, even though the nickel was not in fact nickel, just bags of rocks. > And then one day a warehouse worker, like, stubbed his toe against JPMorgan’s nickel and was like “hmm that’s not the sound nickel makes when you kick it” and opened the bags and found rocks. And then the [London Metal Exchange] dutifully reported that some nickel was not nickel, and JPMorgan’s nickel warrants were transformed into rocks warrants. But it’s all just a random accident? The purpose of JPMorgan’s nickel was not to be turned into batteries or cars, but to sit in a warehouse. It was doing a great job of that, until someone noticed! https://www.bloomberg.com/opinion/articles/2023-03-21/jpmorgan-had-some-fake-nickel https://www.bloomberg.com/opinion/articles/2023-03-21/jpmorg...
- iancmceachern 3y ago
  Stuff like this leaves me wondering...is that bad? I mean it's bad from an honesty and ethics standpoint, but is what JP is doing honest and ethical? And the enemy of my enemy is my friend? The world is complicated
  - mandmandam 3y ago
    The same JPMorgan that financed Epstein, failed to keep mandatory records, "lost" 47 million emails and were fined nearly a billion dollars for spoofing metals markets? The JPMorgan that taxpayers "gave" a $12 billion bailout to? ... Probably not your friend, unless your 'net worth' is in the 8 figures range.
    - iancmceachern 3y ago
      Sorry, I meant the friend being whomever swindled JP and the enemy to be JP in my weird thought experiment
      - orangepurple 3y ago
        JP could have purchased rocks and pretended it was nickel from the very beginning. Where is the Epstein client list?
  - deleted 3y ago
    [deleted]
  - bequanna 3y ago
    Well, this scheme temporarily added more “supply” to the tradable market which theoretically could have lowered overall prices some amount.
  - rz2k 3y ago
    For the net impact to the economy it depends on few things. What did suppliers do in response? If suppliers believed there was a nickel reserve that could potentially enter the market, they would be less likely to choose strategies such as constraining supply in order to increase prices which helps consumers of nickel. However, they also would be less motivated to store up surplus nickel of their own that would help alleviate natural shortages. The other thing to consider is that we think the nickel did exist at some point in time, so in this case crime did pay. Therefore the thieves' ill-gotten gains will have increased their capacity to carry out future scams.
pixl97 3y ago
In the past it was warehousing in general, itemized tracking these days has greatly increased how well we can track things. In the late 80s my dad was a transport manager for a large and well known company. They had recently moved to a newer computer system that greatly expanded the capabilities one had in data charting and comparison. He had the idea "Hey, if I identify where our floor losses due to damages are and minimize those it will probably lead to a nice bonus", but when he began running the numbers something was very very wrong. Losses in some classes of very expensive products were orders of magnitude higher than other assumed random damages. Start coupling this with other data like the regular reoccurrence of damages to these same categories of products and things get suspicious. Then adding in the data the damages always happened on particular shifts and suddenly whispers of the word fraud show up. Turns out a number of employees, middle managers, and a vendor where all involved in a kickback scheme that had been going on for years.
- nullc 3y ago
  So did he get the nice bonus?
  - pixl97 3y ago
    A nice gold watch and no bonus even. Then the next year they internally announced to management they were going to downsize a good portion of the staff, but they couldn't tell anyone. So he left the meeting. Told everyone he managed, and never went back.
ajsnigrutin 3y ago
I was born in yugoslavia, so could be a local peculiarity. Wherever there was a large (communism, so government owned) company, if you needed something that company either had (raw materials) or produced, you just needed to find someone who worked there, and they would sell you whatever you needed. Friend works in iron works/steel company? Need steel sheets, just call him. Need some end products? Just call him. Need cement? Or cement blocks? Just call someone who works at a cement factory, he'll take a few blocks home every day, and after a week or two, you go to his house, pay and pick them up. It was never stealing trucks full of stuff, but with 1000+ workers, having 200, 300 workers that steal a bit every now and then (like pens and post it notes in the "west"), after a few years, you get whole neighbourhoods built using stolen bricks and cement, and all the fences were built out of iron rods, that were destined to become something else.
- nextaccountic 3y ago
  And maybe this neighborhood wouldn't get built if it weren't for the stolen materials, so this form of corruption isn't necessarily a bad thing

dv_dt 3y ago

This makes me think about why new more accountable systems between companies sometimes fail in implementation. Sometimes the existing players are happy with the exploitable gaps in the existing system.

baetylus 3y ago
Great comment. Fun theory -- companies function on personal optics internally. When you sell software, you can get buy in easily if they can say "this'll make me look excellent to my boss" (and they have decision-making power/budget of course). Similarly, a boss will promote subordinates who will make him/her look better.
- gottorf 3y ago
  Put another way, the incentives facing any single component of a greater whole does not always align with the incentives of the organization itself. In fact, you could say that a good measure of how well an organization is run is how closely those different incentives align.
  - maxbond 3y ago
    In economics, this is called the principle-agent problem. https://en.wikipedia.org/wiki/Principal%E2%80%93agent_problem https://en.wikipedia.org/wiki/Principal%E2%80%93agent_proble...
deleted 3y ago
[deleted]

gryn 3y ago

ah yes the old trick of converting praise to blame once someone leaves. every now and then I wonder how many things I'm being blamed for at my old jobs.

Waterluvian 3y ago

Last job I left I did say semi-sarcastically, “and now you can blame any bad thing on me for a while!” And they did from the numerous reports I got. It was amusing. I guess it’s soothing in a way.