corporate scandals

July 1, 2021

Book 291: Bad Blood

“A month or two after Jobs’s death, some of Greg’s colleagues in the engineering department began to notice that Elizabeth was borrowing behaviors and management techniques described in Walter Isaacson’s biography of the late Apple founder. They were all reading the book too and could pinpoint which chapter she was on based on which period of Jobs’s career she was impersonating. Elizabeth even gave the miniLab a Jobs-inspired code name: the 4S. It was a reference to the iPhone 4S, which Apple had coincidentally unveiled the day before Jobs passed away”

Dates read: January 24-28, 2019

Rating: 8/10

When I was getting ready to graduate from high school, I applied to two colleges: Michigan and Stanford. I’d gone to a summer program at Stanford the summer after my sophomore year and fallen completely in love with it and wanted desperately to go there. And this was back under the old points system that the Supreme Court later tossed, so I was able to do the math for my likelihood to be admitted to Michigan and I knew I’d get in. I sent off my applications and got the small envelope from Stanford. I loved my time at Michigan and am so glad I went there, but a part of me always wonders what my life might have been like if it had worked out differently.

I’m hardly alone at having not gotten into Stanford, as they accept only about one in every twenty applicants. Not everyone who gets in stays there, though, and one dropout is more notorious than the rest: Elizabeth Holmes. At 19, she left the university to found her own company, Theranos, the rise and fall of which is chronicled in John Carreyrou’s Bad Blood. Holmes’ original idea was a patch that could administer medications directly to the bloodstream. When that proved untenable, though, she turned to blood testing. Terrified of needles, she came up with the idea of being able to run diagnostics using just a few drops from a finger stick instead of the giant scary needles in the arm. It promised to revolutionize the industry, making testing cheaper and easier. There was just one problem: it didn’t work.

For a long time, though, she was able to convince people that it did. She raised billions in capital. She built a prestigious board of directors. She was courted by the CEOs of pharmacies and supermarkets, desperate for a chance to implement her technology. And if anyone seemed like they might get in her way or slow her down, she terrified them into silence with legal threats. Eventually, though, a leak sprung, and Carreyrou began to write about the company’s struggles in The Wall Street Journal. Despite high-powered lawyers doing their best to separate him from his sources, he was eventually able to expose the massive house of cards that was all Theranos ever was. Holmes and her ex-boyfriend, Sunny Balwani (the company’s COO), currently face federal criminal charges that could imprison them for years.

Corporate malfeasance can make for highly entertaining movies, but there’s a reason most true crime writers shy away from white collar stuff in favor of murder: it’s hard to render bad business practices as exciting on the page. But in Holmes and Balwani, Carreyrou has two striking personalities to work with and he makes the most of them. It might be easy to write Holmes off as a deluded posturer, but he shows how her vindictiveness towards those that might have been able to expose her is the behavior of someone who knows full well what she was doing. And Balwani’s fiery temper, the fear he inspired, leap off the page. The writing does sometimes veer into the technical, but the outlines are fundamentally of a confidence scheme, and Carreyrou keeps the book engrossing by focusing on the way it plays out, the way Holmes so often seems trapped in a corner and manages to escape yet again.

Between Holmes, Anna Delvey, and Fyre Fest, scammers are having a moment in American culture. There’s something revolting and yet fascinating about people who operate without any of the fear many of us seem to feel about deserving our place. Anyone inclined to feel sympathy for Holmes, to feel like she just got in over her head, will have a hard time maintaining that once they read the truly heartbreaking account of how a prominent scientist who tried to get things back at least adjacent to the track was preyed upon by both Holmes and Balwani. When he eventually committed suicide, the company’s only response was to get his work laptop back. We live in a time when technology companies, and the people who run them, are effectuating enormous changes with very few probing questions asked. This book, which I really enjoyed and highly recommend, demonstrates why we should ask more.

One year ago, I was reading: The Borgias

Two years ago, I was reading: The Wind-Up Bird Chronicle

Three years ago, I was reading: Perfect Murder, Perfect Town

Four years ago, I was reading: My Antonia

Five years ago, I was reading: Missing, Presumed

October 8, 2020

Book 254: The Informant

“Shepard turned to Weatherall, shaking his head. They had heard enough to know this tape was fabulous. Their witness—this lying, manipulative man who had just failed a polygraph exam—was in the middle of a massive criminal conspiracy.”

Dates read: August 9-16, 2018

Rating: 5/10

Well, this is embarassing. Though I have no recollection of deleting the post I wrote for this book after reading it (I usually write my review within a few weeks of reading the book), it seems as though it has vanished. Maybe it was me, maybe it was a Blogger issue, but it is gone and the reality is that my memory of reading this book over two years ago is…not especially detailed. Therefore, this is likely going to be the shortest, least in-depth review I will ever post here, because I am not going to go back and re-read it so I can re-write the post.

The Informant, written by Kurt Eichenwald, is a true story that you would swear was a farce if you didn’t know otherwise. Mark Whitacre was an executive for Archer Daniels Midland, a large agri-business company. For years, ADM had been working with their so-called competitors to fix the price of food additive lysine, which Whitacre confesses to the FBI. He then goes undercover to tape meetings at which this price-fixing continues to happen, repeatedly almost managing to get himself caught but capturing hundreds of conversations for his government handlers. As the case is moving towards trial, a complication emerges: Whitacre has embezzled several million dollars from ADM, in part because he actually got suckered into one of those Nigerian advance-fee scams. After years of working to help the feds build a case against ADM, the bipolar Whitacre turns against the FBI during manic episodes, claiming that they have tampered with evidence. His behavior related to these claims invalidates his plea deal with the government, and he is charged along with the rest of his colleagues in the underlying price-fixing scandal, eventually being convicted and sentenced to nine years in prison.

What I remember most about the book is its length, over 600 pages of often dense prose. The underlying crime is a very complicated white-collar conspiracy, and while Eichenwald did a decent job of trying to make it straightforward, my overwhelming recollection is that it frequently dragged. Whitacre himself is presented as a complex person: being a whistleblower/informant is a very stressful, pressure-filled situation, and combined with his untreated mental illness, he often behaves erratically. He is very sympathetic in some aspects, much less so in others. I feel like I remember that this was one of those books where the author was under the impression that his own reporting of the story was of particular interest to those reading it, which tends to be a pet peeve for me in non-fiction. It was often a struggle to read, and I didn’t particularly enjoy the experience of doing so, so I wouldn’t necessarily recommend it to others.

One year ago, I was reading: The Overstory

Two years ago, I was reading: The Library Book

Three years ago, I was reading: The Royals

Four years ago, I was reading: The Mothers

April 12, 2018

Book 124: Flowertown

“Contamination and containment became the buzzwords, replaced quickly with quarantine and treatment, all to the musical backdrop of international media and outrage as the world demanded to know who was responsible for the poisoning of seven and a half square miles of America’s heartland. There were Senate hearings and criminal investigations. Some people died and many more people suffered, but as weeks turned into months, most people outside of the Penn County spill zone went back to their jobs and their newscasts and their horror at the other atrocities available on every continent, on every channel.”

Dates read: February 6-9, 2017

Rating: 6/10

When it comes to corporate scandals, there’s little that it’s hard to believe in this day and age. The Ford Pinto incident seems especially egregious, but even the recent enormous price hikes of life-saving medication like the Epi-Pen should remind us all that for companies, the value of human life often gets lost somewhere in the cost-benefit analysis matrix. For all that mega-corporations try to create brand loyalty and convince us that they do actually care, the bottom line is that the entire point of a publicly-traded company is to maximize value for stockholders. If there is little-to-no impact on their income reports, sure, some companies will do the right thing. But when it comes down to it, nearly all the time they will chose profit over any other factor.

In S.G. Redling’s Flowertown, it’s a company called Feno Chemical that finds itself mired in controversy after a disastrous pesticide spill in a small town in Iowa. The area is quarantined by the Army as large numbers of residents begin to die from exposure to the toxin, and Feno’s pharmaceutical subsidiary develops a drug regime to try to treat them. For those who manage to survive, the drugs have a side effect: a sweet smell that emanates from those who’ve been dosed, leading to the nickname Flowertown. Even with the drugs, though, the chemicals are excreted from the body through any liquid and prove impossible to remove through filtering, so the people who remain have to stay to avoid infecting anyone else.

Ellie Caulley had just quit her job in advertising and was visiting her boyfriend’s hometown before they were to take off on a trip overseas when the accident happened. Her boyfriend and his family died, but Ellie lived, and after seven years of being trapped in the confines of Flowertown, she only manages to keep a lid on her anger by being high all the time and sleeping with one of the Army officers assigned to keep the peace. She has only two friends: her sweet-natured roommate Rachel and the hyper-paranoid Bing, who keeps her in pot. When bombs start going off, though, she finds herself increasingly drawn into the local events: who’s setting off the explosions? The local resistance movement? Feno Chemical trying to rid itself of a problem? The Army?

This is a mystery/thriller, but once events are set into motion, it’s not too hard to figure out what the deal is (I’m not good at that kind of thing at all, but I still figured it out). The character development is surprisingly decent…Redling’s Ellie is a prickly heroine who takes some warming up to but captures your sympathies. It’s not hard to imagine how awful it would be to find yourself in the situation she does, how it would drive you almost crazy with loss and regret. With most of the books in this genre that I’ve read, creating characters doesn’t seem like a big priority, but this book is less plot and more character driven, which worked for me. If you’re looking for a thriller-style book based in people and personalities, this is a solid (albeit unspectacular) read.

Tell me, blog friends…have any stories about corporate greed come out that you had an especially hard time believing?

One year ago, I was reading: Big Little Lies

Two years ago, I was reading: Dead Wake

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