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baldona
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How much wealth until you can hide FU money?
Buddy and I got in a convo about Elizabeth Holmes the founder of Theranos that had a net worth of $9 Bil before fraud and civil penalties made it “$0”. I mean no way she doesn’t have money somewhere right? Filtering off $10 or $20 mil from $9 bil is not that hard.

At some point, everyone would hide some money right? Offshore, Switzerland, etc. I have no idea, I’m sure there’s places for those with $100mil plus most of us wouldn’t even think about.

At what point is someone able to hide away enough that if the shite hits the fan you disappear and have money put away you can survive care free for life? It wouldn’t take much, $5 to $10 mil right? Buy a nice house $500k through multiple foreign Corporations and live off of 2% bank interest of $9 mil. That’s $180,000. I could hustle up a great life fairly easily on that somewhere like Thailand.

Are people doing this at $100 mil net worths? $500mil? Every wealthy person I know has a ‘oh shit’ plan to some degree. They don’t want to go back to real work again.


whodatigahbait
LSU Fan
Uptown
Member since Oct 2007
1507 posts

re: How much wealth until you can hide FU money?
quote:

Buddy and I got in a convo about Elizabeth Holmes the founder of Theranos that had a net worth of $9 Bil before fraud and civil penalties made it “$0”. I mean no way she doesn’t have money somewhere right? Filtering off $10 or $20 mil from $9 bil is not that hard.

At some point, everyone would hide some money right? Offshore, Switzerland, etc. I have no idea, I’m sure there’s places for those with $100mil plus most of us wouldn’t even think about.

At what point is someone able to hide away enough that if the shite hits the fan you disappear and have money put away you can survive care free for life? It wouldn’t take much, $5 to $10 mil right? Buy a nice house $500k through multiple foreign Corporations and live off of 2% bank interest of $9 mil. That’s $180,000. I could hustle up a great life fairly easily on that somewhere like Thailand.

Are people doing this at $100 mil net worths? $500mil? Every wealthy person I know has a ‘oh shit’ plan to some degree. They don’t want to go back to real work again.


She was "worth" $9 billion but the vast majority and maybe all was because of her ownership of Theranos. I think it is easy to squirrel away cash in most instances, however I'm not sure about this one.

Not sure how she could've taken cash off the table.


Hermit Crab
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5920 posts

re: How much wealth until you can hide FU money?
Just depends on if they made distributions after capital raises or all of their equity was rolled.

And since theranos was a private company she wouldn’t have been able to easily sell shares to tuck away somewhere


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brian_wilson
LSU Fan
Member since Oct 2016
2809 posts

re: How much wealth until you can hide FU money?
quote:

Are people doing this at $100 mil net worths?

Probably a bit less than that. I am not 100M wealthy.

The easy solution to this is to buy physical gold and store it in a location not in the US.


baldona
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re: How much wealth until you can hide FU money?
Sure but still multiple billions, if you can’t filter off 0.5% (like 1/2 of 1%) come on. She also rose and fell quickly, not a lot of time. But someone worth say $100 mil for 30 years. Not that hard to work out a way to have hidden money.

Someone like Holmes knew it was only a matter of time. In that situation, how dumb are you to not prepare financially?


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lilsnappa
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re: How much wealth until you can hide FU money?
None of that $9B was liquid, other than the salary she was taking.

That's not how that works. All the $9B means is what the company was worth (based on the last private investment) and how many shares she has.


baldona
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re: How much wealth until you can hide FU money?
quote:

The easy solution to this is to buy physical gold and store it in a location not in the US.


Absolutely. Diamonds, Rare Art, etc. things that are easily moved and sold to people that don’t want it public.


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baldona
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re: How much wealth until you can hide FU money?
quote:

None of that $9B was liquid, other than the salary she was taking.


None? Come on. If you have a $9 bil company you are filtering off some money. $10 mil is one bad real estate transaction for a research lab in Cambodia. That’s nothing.

Eta: We are talking about someone that basically falsified data and tests to even become that wealthy. I very much doubt everyone in her accounting dept. was pure also.
This post was edited on 12/6 at 10:23 am


Mingo Was His NameO
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re: How much wealth until you can hide FU money?
The problem with your plan is most of these people start out legit and then result to fraud to keep the company going. You then convince yourself what your doing isn't wrong. It wasn't a giant ruse, she didn't set out to funnel off X% of the highest value she could get her company to.


whodatigahbait
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Member since Oct 2007
1507 posts

re: How much wealth until you can hide FU money?
quote:


None? Come on. If you have a $9 bil company you are filtering off some money. $10 mil is one bad real estate transaction for a research lab in Cambodia. That’s nothing.

Eta: We are talking about someone that basically falsified data and tests to even become that wealthy. I very much doubt everyone in her accounting dept. was pure also.


Not when the company is VC backed and has negative cash flow.


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baldona
Auburn Fan
Florida
Member since Feb 2016
7844 posts
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re: How much wealth until you can hide FU money?
quote:

The problem with your plan is most of these people start out legit and then result to fraud to keep the company going. You then convince yourself what your doing isn't wrong. It wasn't a giant ruse, she didn't set out to funnel off X% of the highest value she could get her company to.


Disagree. Sure some do, but plenty set out to make money first and foremost no matter what. My little understanding of Holmes’s as an instance is that the very basis of her testing was fraudulent from very early on. She rode that train hard. Sure, she could have had every intention of trying to figure it out. But she lied from early on for a reason.

Most of these ‘American greed’ guys are shady AF through and through. If it’s not one scheme it’s another.

That’s besides the point. Again, once you hit a certain point of wealth you don’t want to be poor again. You don’t risk absolutely everything unless you have to or you are dumb.


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kciDAtaE
Member since Apr 2017
3473 posts

re: How much wealth until you can hide FU money?
quote:

Buy a nice house $500k through multiple foreign Corporations and live off of 2% bank interest of $9 mil. That’s $180,000. I could hustle up a great life fairly easily on that somewhere like Thailand.


I wouldn’t call that FU money. If you have to move to Thailand to make it work, it’s not FU money.


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Decisions
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re: How much wealth until you can hide FU money?
quote:

Are people doing this at $100 mil net worths?


I’d say certainly by then, if not a bit sooner.

Though rather than FU amounts of money I’d wager it’s just enough to live comfortably—say upper-middle class. You or your heirs can rebuild from that position. It wouldn’t be easy, but it wouldn’t be nearly as stacked against you as being flat broke.


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EA6B
Navy Fan
TX
Member since Dec 2012
8363 posts

re: How much wealth until you can hide FU money?
quote:

Not when the company is VC backed and has negative cash flow.


They would have had their own people auditing where every dollar went.


baldona
Auburn Fan
Florida
Member since Feb 2016
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re: How much wealth until you can hide FU money?
quote:

They would have had their own people auditing where every dollar went.


Yeah, no. This instance for example, you guys act like VC’s are perfect and miss nothing. Again $9 bil evaluation and I’m talking $10 mil. The VC’s missed the fact the entire business was a fraud, but they are going to be able to keep an eye on every cent?

As the owner/ CEO you guys are assuming we are talking about only pay/ stocks/ employee reimbursement which is very wrong. As CEO you can fairly easily divert something as measily as routine supplies, return them using a different bank account in your name, and profit. With one person with you in accounting and a billion dollar company, it’s fairly easy to divert small amounts of cash in supplies/ COGS that are assumed to be in storage or used.

Maybe Holmes is not a great example. My point is simply at what amount of wealth does someone take the measures to never be poor or have to ‘work’ again?
This post was edited on 12/7 at 7:24 am


SlowFlowPro
Stanford Fan
Simple Solutions to Complex Probs
Member since Jan 2004
360702 posts

re: How much wealth until you can hide FU money?
quote:

None? Come on. If you have a $9 bil company you are filtering off some money.

what money?

that $9B was based on stock evaluations. i don't think she was even vested and those stocks weren't transferrable at the time. Theranos was privately-held, not a publicly-traded company.

and he company itself wasn't generating tons of revenue and was not profitable when the fraud was found. what money is she filtering?


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SlowFlowPro
Stanford Fan
Simple Solutions to Complex Probs
Member since Jan 2004
360702 posts

re: How much wealth until you can hide FU money?
quote:

Again $9 bil evaluation and I’m talking $10 mil.

how does she turn $10M of that stock equity into $10M of cash equity? does she get a loan or something? who is she going to sell to? even if she sells some insane markup (like $100M in stock for $10M in cash), the buyer is going to ask why the CEO is doing this AND the buyer would have to keep it silent (b/c if word got out that $9B would go to $0 quickly)


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MusclesofBrussels
Member since Dec 2015
1675 posts
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re: How much wealth until you can hide FU money?
quote:

If you have a $9 bil company you are filtering off some money. $10 mil is one bad real estate transaction for a research lab in Cambodia. That’s nothing.




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whodatigahbait
LSU Fan
Uptown
Member since Oct 2007
1507 posts

re: How much wealth until you can hide FU money?
quote:

Maybe Holmes is not a great example. My point is simply at what amount of wealth does someone take the measures to never be poor or have to ‘work’ again?


Holmes is a terrible example, and you my friend are an idiot.


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whodatigahbait
LSU Fan
Uptown
Member since Oct 2007
1507 posts

re: How much wealth until you can hide FU money?
quote:

They would have had their own people auditing where every dollar went.



Exactly


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