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0 pointsduxup6y ago0 comments

Reminds me of this story:

https://a16z.com/2014/02/06/why-i-did-not-go-to-jail/

TL;DR, A widely respected CFO makes a suggestion regarding stock and being competitive as far as employee compensation. CFO says that they have done the same thing at numerous companies. The CEO is not very knowledgeable and asks the general council (who unlike a lot of places at the time reports directly to the CEO, not the CFO) to weigh in. General council says don't do it, so they don't. 2 years later, CFO goes to jail, CEO and everyone else stays out of jail because of a good decision.

I would extend your lesson and say to be sure you are asking a lawyer who has knowledge / experience in the area of law you're asking about.

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SilasX6y ago

Yes, but it also affirms what the parent was saying: if something doesn't smell right, get a second opinion. In this case, Horowitz got advice that said "do this thing that gives free money, even though no one else does it". That seemed too good to be true, and that's what triggered his insistence that the general counsel look at it.

ww5206y ago

That's an amazing story. Did PWC's people go to jail as well?

duxupOP6y ago

I don't know as I've no specific information on what they actually did.

However, it sounds a bit like backdating stock options type thing, and a fair amount of people went to jail over that across various industries.

icelancer6y ago

A bunch of companies did it simply because they thought it was best practice, not for specifically immoral means. The majority of people who did it accidentally and could prove it with a paper trail of trying to follow auditors best practices got off with fines / warnings, which seems appropriate.

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