Top Five Corporate Frauds of The Century

Welcome back to Patrick Boyle on Finance. In todays video we look at some of the biggest Corporate Scandals since the turn of the century in no particular order, and let’s see if there is anything we can learn from them. This video is a re-upload of Fridays video as there were audio problems with the original.

Timestamps
00:00 Introduction
00:16 Elizabeth Holmes - Theranos
04:10 Lu Zhengyao - Luckin Coffee
07:43 Markus Braun - Wirecard
11:34 Bernie Ebbers - Worldcom
15:20 Jeff Skilling - Enron
18:54 Conclusion

[PBoyle]

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[DiiNovensiles]

I was working in automated blood testing R&D when Theranos started. Everyone in the department knew it wasn't possible, we weren't even concerned about them as a competitor.

[Kauk]

I remember deciding to try out a cup of Luckin in Beijing. The place was completely empty, there were no menus and they told me I had to download the app to order. I just went to Starbucks across the road

[SnappCheck]

I did not knew hitman was into finance

[FernandoBorea]

"Because there is an app of course is a disruptive tech company" Loved this part 😂😂😂😂😂

[zelytics]

The Theranos debacle is why we have strict laws regarding healthcare innovation. Having worked myself in Silicon Valley, interestingly enough across the street from Theranos it became clear to me that a lot of VC’s and tech entrepreneurs don’t realize tech startup hypergrowth models just don’t work in biotech and medicine.

[InturnetHaetMachine]

In the Wirecard saga, the bigger news for me was how the regulators protected the fraudulent behaviour and went after the journalist and short sellers. There usually isn't just a single cockroach, I wonder how many inside the system had been compromised.

[nuvag]

This short selling thing sounds interesting, before I get started I would like to know if there is a list of CEOs dressing like Steve Jobs? This would make the stock picking so much easier 😉

[tracyh]

Two years later and the video already needs an update. Amazing times we live in.

[Itriedtakennames]

The Theranos “200 tests at once” was a bad idea, even if it actually worked. All medical tests have a small false positive or negative rate, meaning you told positive for something you don’t have. Sometimes it is a lab error, or sometimes physiologic interference (if you had shellfish to eat recently, you can get a falsely high arsenic reading, etc). Even if 99.99% accurate, if you run hundreds of unneeded tests per person at a time, there is a decent chance of getting a false positive result in 1 of every just 4 or 5 panels. Almost always, that false positive lab test leads to additional testing, appointments, worry, even procedures or scans, just to prove “no you don’t have cancer, ..just a false positive.” Who is going to pay for all those unneeded, additional work-ups? This is also why doctors now actively discourage “annual physicals” in people under 50 - 60, as the chance of a false positive test is higher than the chance a test will catch something in an asymptomatic person early enough to have a benefit. So except for a few unusual scenarios (such as in the military), medicine doesn’t really want or need 200 tests at once.

[pincer]

This is nicely made, no baseless music; no unnecessary jokes, I can work and listen to this without any problem :)

[poohshmoo]

chuckled on "...named it Edison because Tesla was taken .. " .. it is crime to not subscribe to this channel

[jfanreva]

Enron investors (and Arthur Anderson) weren't the only ones to lose out. Enron employees' retirement accounts were mandated to be funded with 100% Enron stock. Employees could do nothing as they literally saw million dollar retirement accounts drop to zero value.

[rok]

I am thinking of one company that in a very short time became more valuable than all established competitors combined (by stock valuation), operating in a traditional business but claiming to revolutionize the industry by improving a 100+ year old technology.
The excitement is electric!

[steppenfuchs]

Holmes father also had a part in Enron as a higher up executive soo... I guess the apple doesn’t fall far from the tree.

[jt]

Patrick, once again I have to comment. I’m getting as many tips in dry humor as I am in practical finance.

Salute.

[carlosflar]

Small correction: you dont need one blood vial for each test, you can actually run lots of different tests on the same vial, you need multiple vials because certain tests need different vials that are incompatible with eachother, for example, some vials will be just simple vacuum vials, some will have citrate added, some will have a polymer in the bottom, some will have ETA, and if you're using the ETA vials you can't measure the coagulation of someone or if you're using the normal tube, you will have problems with the blood clotting and you won't be able to properly count platelets or measure hemoglobin... A normal blood analysis will easily have tens of different tests and only require two or three vials

[jonatanwestholm]

Incredible that the short seller actually employed 1000s of people to do footwork as part of the investigation. That's the short selling system at work.

[JudgementalGoat]

Cold Fusion has one of the best mini-documentaries about Theranos I've ever heard, it's amazing how this woman managed to deceive so many people and get away with it.

[maximmatkovsky]

Thank you very much for the video. I remember how Ernst and Younge managed to say that they were the victims in Eurocard accounting scandal....while being the auditor. Ironically, same thing occured to Andersen accounting and Enron scandal, which ended Andersen. 20 years pass and same thing is being labeled as being a victim of accounting fraud