Wider Reach of Scams

About a month ago, I wrote about the wide reach of scams and how there are unsavory characters pressuring people into art donation schemes that benefit their tax returns. So often we think of scam victims as those without the knowledge and/or know-how to combat someone who confronts them with either a desperate situation or a quick grab for cash. The wealthy somehow seem above this in our minds. But now that we can add last week’s guilty verdict in the Sam Bankman-Fried case, we need to keep adjusting the view on who could be a victim, for it really is everyone.

After all, Bankman-Fried’s fraud crimes covered somewhere in the range of $10 billion, so we aren’t talking anything near a pittance here. But with former scandals like the work of Bernie Madoff and the savings and loan crisis of the 1980s, we have seen how things can grow and cover more than one poor victim.

But maybe there is some logic in there. If we think of a scam that affects one person, we can envision how that person feels. And even if they only end up losing somewhere in the range of $500, it is easy to think of the bills that could have been paid with that money and how the victim may have to scramble to cover it. That number is small in the grand scheme, but also small enough that we can appreciate it.

It is must more difficult to appreciate just what $10 billion is.

Beyond that, Bankman-Fried worked in the cryptocurrency world, which holds some mystery of its own. I mean, I have no problem admitting that my understanding of the crypto world is rather amateur, but Bankman-Fried’s looks like it may not have been much better. He was able to sell enough people into believing that he knew something, though, and that his products and ideas may have held the key to great returns – but it turned into a great mess.

And his rise and fall did not take a long period of time, somewhere around a year in total. So this isn’t saying one can just lie their way through a grand life, but you can apparently go really big for a really short period of time.

It’s difficult to imagine that people making such big deals did not spend some time looking into the situation, too. There had to be more than dreams behind these deals. Those big hopes, though, also undeniably played a part. So maybe at the end we are in a space where we can say be careful but also maybe we can only do so much, and we all remain susceptible.

Warmly,

Josh Bousquet
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