Yet another Hacker News

Theranos-Style Fraud Has Become the Norm

80 points fortran77 2 hours ago 25 comments

devops000 1 hour ago | parent

Cannot read due to paywall

rubymancer 1 hour ago | parent

https://archive.ph/BdlXw

masfuerte 54 minutes ago | parent

It works fine without JS.

whimsicalism 48 minutes ago | parent

found the article quite weak, hurt by the East Coast media’s tendency to make everything about government & Trump.

> Donald Trump has unashamedly profited from the presidency, earning more than $1.4 billion in 2025 from cryptocurrency deals. The Trump family has received significant money coming from countries that wish to bend the president’s ear on foreign policy. Donald Trump Jr. has benefited from the sudden interest in his business acumen. Months after the younger Trump’s venture-capital firm took an ownership stake in a rare-earth-magnet start-up, it was awarded a $620 million government loan.

I was hoping, if this style of fraud has become the norm, that we would have more true non-governmental examples. I do not agree that it has become the norm and don’t think this article does much to make the case.

danielklnstein 40 minutes ago | parent

Agreed. Even the non-governmental example in the article - Nikola Corporation - was uncovered as a fraud more than six years ago. And the governmental examples as described aren't even fraud, they're corruption.

Even in this day and age of somewhat exorbitant company valuations, it's infinitely more difficult to replicate the kind of fraud of Nikola or Theranos. If only because of those companies setting a precedent for abject fraudulence and making basic due diligence that much more of a necessity/expectation. A company like Instinct wouldn't manage to get away with its current valuation if their technology wasn't front-and-center for everyone to see and use.

Time will tell - for all we know there's currently a large company more fraudulent than either of those, and we'll only find out in the future - but trying to paint it as the norm isn't based in any recent real-world examples.

jacquesm 40 minutes ago | parent

Does asking for downpayments on vehicles you will never ship count?

If so then you you have one more example now.

sportsracersss 36 minutes ago | parent

They took nonrefundable down payments on the Roadster nine years ago.

api 34 minutes ago | parent

Preorder down payments are a thing I won’t do anymore.

Never done it on something that huge but I’ve been burned on one or two kickstarter type things.

If you can’t pay and then take delivery it doesn’t exist.

jacquesm 20 minutes ago | parent

I see kickstarter projects as gifts until proven otherwise.

woadwarrior01 14 minutes ago | parent

Did you mean grifts?

jacquesm 20 minutes ago | parent

Do they at least pay good interest on the money they took in? Because a decade long interest free loan is a really weird thing and non-refundable only makes sense if they end up shipping them, and they should probably ship them before a sizeable fraction of their customers has died. 9 years to make a car...

btilly 11 minutes ago | parent

A number of the people who paid those downpayments, were invited to the recent Roadster demo. Where they got to see a similar car demonstrated, complete with flying. And with no sense of whether it will actually be built, or will be street legal.

jgalt212 14 minutes ago | parent

I'd love to get my hands on that customer list.

pseudony 36 minutes ago | parent

A good argument could be made that precisely because it happens in government and those people aren’t booted out post-haste, then society is apparently a lot more OK with this style of behavior than before.

I think Nixon’s watergate is a good comparison. It wasn’t nothing, but how many larger scams and scandals has Trump and family been through with apparent electoral acceptance?

And if it is so. How big a reaction would you get from the population if another Theranos happened? I don’t think people would care, really. Shrug and move on.

nradov 8 minutes ago | parent

Most of the population wouldn't care about another Theranos because it wouldn't have any impact on them. People only cared about the first Theranos because Elizabeth Holmes was such a bizarre character. The fraud and business failure didn't have any broader impact on the financial system. And while knowingly giving unsuspecting patients inaccurate blood test lab results was inexcusable and deserving of severe punishment, in the end no one died.

jeremyjh 27 minutes ago | parent

This is the point though. Trump's approval ratings prove his base does not give a single flying fuck about his grift and corruption. They admire it.

Now you've got a third of the country who are just totally ok with fraud if its perpetrated by someone on their team.

Nearly all tech billionaires are on their team.

cmiles74 12 minutes ago | parent

I wasn't wow-ed by this piece either. There does seem to be something there, though: this thing where someone commits some serious fraud yet gives Trump a slice and then they're pardoned, along with the precipitous drop in prosecuting just these kinds of cases.

bix6 5 minutes ago | parent

It’s a movie review so they didn’t actually go in deep on the fraud.

FTX, Terra-Luna, Nikola (as mentioned), Builder.ai, Frank, Kalder, Joonko

O and have you heard about the AI labs and how they calculate ARR? lol.

Statistically significant though? I do not know.

ViktorRay 40 minutes ago | parent

I don’t believe it has become the norm.

We’re talking about fraud about medical results over technology that essentially violates basic principles.

Honestly it’s kind of astounding Theranos ever became so hyped. The mythology of Silicon Valley and the glorification of shady shit probably helped. Reddit for example started out by doing shady shit. They would fake activity on the site with bots.

Y Combinator and Paul Graham glorified this kind of fake it until you make it bullshit. Reddit was an early Y Combinator startup. So I think they have an indirect responsibility of promoting this culture.

(Obviously they were not directly involved in Theranos)

mschuster91 38 minutes ago | parent

> Reddit for example started out by doing shady shit. They would fake activity on the site with bots.

That's not the biggest problem by far. They started out catering to literal pedos, look into the r/jailbait controversy.

api 26 minutes ago | parent

Reddit still has a substantial amount of… not CSAM but rather skeezy porn. They just kind of hide it and ban it from the front page and auto feeds.

There’s a long history of revenge porn and other nonconsensual porn showing up there and being hard to remove.

The whole site had been declining badly too, and is loaded with bots. Still an okay place to get news in some areas but pretty meh and the comments are always echo chambers.

danielklnstein 34 minutes ago | parent

> So I think they have an indirect responsibility of promoting this culture.

Interesting comparison to compare the "standard" software fraudulence of fudging your activity numbers to Theranos' fraud.

I think when it comes down to it, it's a false equivalence - one is a temporary measure done to overcome an inherently short-term critical mass limitation, the second is an indefinite fraud trying to paint an impossible company as real.

"Fake it till you make it" is a legitimate and almost necessary strategy for an early-stage startup, I wouldn't conflate it with Theranos' fraud.

ryukoposting 25 minutes ago | parent

Theranos faked it, the difference is that they never had any intention of making it.

I think that's what you're saying, at least.

Hydraulix989 29 minutes ago | parent

This "succeed at all costs" culture isn't a Valley thing, it's an American thing. Look at our President.

orliesaurus 21 minutes ago | parent

The real fraud is companies raising 100s of millions with fakeish ARR values and then couple of years later they collapse into nothingness