Weekend Nov 27, 2022

Latino Justice alleges MTC charged for services they nefer performed.

The multiple contracts between the Texas Department of Criminal Justice (TDCJ) and MTC were to provide minimum hours of group therapy, individual one-on-one therapy, and other treatment programs. Prisoners were allegedly told that COVID protocols prevented them from participating in counseling, but they were still housed in bunkrooms with 50 or more people.

The document also details how MTC created a "fraudulent paper trail" to "hide the fact that it breached contracts" to collect millions from work it did not perform. It also accuses MTC of charging TDCJ for requiring prisoners to fill out workbook pages instead of providing in-person counseling sessions. MTC allegedly asked that inmates participating in the program falsify time sheets and if they did not, their parole would be revoked.

Latino Justice's complaint names three Texas prisons that earned the company more than $5 million from March 2020 to January 2022. The advocacy group also noted that MTC has 17 active contracts with TDCJ valued at more than $100 million.

MTC spokesperson David Martinson declined to answer questions to the Texas Tribune Monday. However, TDCJ spokesperson Robert Hurst sent a statement saying the company will fully cooperate with the state auditor's investigation into the complaint and launch an independent internal investigation.

1844

It is said that the world is in a state of bankruptcy, that the world owes the world more than the world can pay, and ought to go into chancery, and be sold. I do not think this general insolvency, which involves in some sort all the population, to be the reason of the difficulty experienced at Christmas and New Year, and other times, in bestowing gifts; since it is always so pleasant to be generous, though very vexatious to pay debts. But the impediment lies in the choosing. If, at any time, it comes into my head, that a present is due from me to somebody, I am puzzled what to give, until the opportunity is gone. Flowers and fruits are always fit presents; flowers, because they are a proud assertion that a ray of beauty outvalues all the utilities of the world. These gay natures contrast with the somewhat stern countenance of ordinary nature: they are like music heard out of a work-house. Nature does not cocker us: we are children, not pets: she is not fond: everything is dealt to us without fear or favor, after severe universal laws. Yet these delicate flowers look like the frolic and interference of love and beauty. Men use to tell us that we love flattery, even though we are not deceived by it, because it shows that we are of importance enough to be courted. Something like that pleasure, the flowers give us: what am I to whom these sweet hints are addressed? Fruits are acceptable gifts, because they are the flower of commodities, and admit of fantastic values being attached to them. If a man should send to me to come a hundred miles to visit him, and should set before me a basket of fine summerfruit, I should think there was some proportion between the labor and the reward.

For common gifts, necessity makes pertinences and beauty every day, and one is glad when an imperative leaves him no option, since if the man at the door have no shoes, you have not to consider whether you could procure him a paint-box. And as it is always pleasing to see a man eat bread, or drink water, in the house or out of doors, so it is always a great satisfaction to supply these first wants. Necessity does everything well. In our condition of universal dependence, it seems heroic to let the petitioner be the judge of his necessity, and to give all that is asked, though at great inconvenience. If it be a fantastic desire, it is better to leave to others the office of punishing him. I can think of many parts I should prefer playing to that of the Furies. Next to things of necessity, the rule for a gift, which one of my friends prescribed, is, that we might convey to some person that which properly belonged to his character, and was easily associated with him in thought. But our tokens of compliment and love are for the most part barbarous. Rings and other jewels are not gifts, but apologies for gifts. The only gift is a portion of thyself. Thou must bleed for me. Therefore the poet brings his poem; the shepherd, his lamb; the farmer, corn; the miner, a gem; the sailor, coral and shells; the painter, his picture; the girl, a handkerchief of her own sewing. This is right and pleasing, for it restores society in so far to its primary basis, when a man's biography is conveyed in his gift, and every man's wealth is an index of his merit. But it is a cold, lifeless business when you go to the shops to buy me something, which does not represent your life and talent, but a goldsmith's. This is fit for kings, and rich men who represent kings, and a false state of property, to make presents of gold and silver stuffs, as a kind of symbolical sin-offering, or payment of black-mail.

The law of benefits is a difficult channel, which requires careful sailing, or rude boats. It is not the office of a man to receive gifts. How dare you give them? We wish to be self-sustained. We do not quite forgive a giver. The hand that feeds us is in some danger of being bitten. We can receive anything from love, for that is a way of receiving it from ourselves; but not from any one who assumes to bestow. We sometimes hate the meat which we eat, because there seems something of degrading dependence in living by it.

"Brother, if Jove to thee a present make,
Take heed that from his hands thou nothing take."

We ask the whole. Nothing less will content us. We arraign society, if it do not give us besides earth, and fire, and water, opportunity, love, reverence, and objects of veneration.

He is a good man, who can receive a gift well. We are either glad or sorry at a gift, and both emotions are unbecoming. Some violence, I think, is done, some degradation borne, when I rejoice or grieve at a gift. I am sorry when my independence is invaded, or when a gift comes from such as do not know my spirit, and so the act is not supported; and if the gift pleases me overmuch, then I should be ashamed that the donor should read my heart, and see that I love his commodity, and not him. The gift, to be true, must be the flowing of the giver unto me, correspondent to my flowing unto him. When the waters are at level, then my goods pass to him, and his to me. All his are mine, all mine his. I say to him, How can you give me this pot of oil, or this flagon of wine, when all your oil and wine is mine, which belief of mine this gift seems to deny? Hence the fitness of beautiful, not useful things for gifts. This giving is flat usurpation, and therefore when the beneficiary is ungrateful, as all beneficiaries hate all Timons, not at all considering the value of the gift, but looking back to the greater store it was taken from, I rather sympathize with the beneficiary, than with the anger of my lord Timon. For, the expectation of gratitude is mean, and is continually punished by the total insensibility of the obliged person. It is a great happiness to get off without injury and heart-burning, from one who has had the ill luck to be served by you. It is a very onerous business, this of being served, and the debtor naturally wishes to give you a slap. A golden text for these gentlemen is that which I so admire in the Buddhist, who never thanks, and who says, "Do not flatter your benefactors."

The reason of these discords I conceive to be, that there is no commensurability between a man and any gift. You cannot give anything to a magnanimous person. After you have served him, he at once puts you in debt by his magnanimity. The service a man renders his friend is trivial and selfish, compared with the service he knows his friend stood in readiness to yield him, alike before he had begun to serve his friend, and now also. Compared with that good-will I bear my friend, the benefit it is in my power to render him seems small. Besides, our action on each other, good as well as evil, is so incidental and at random, that we can seldom hear the acknowledgments of any person who would thank us for a benefit, without some shame and humiliation. We can rarely strike a direct stroke, but must be content with an oblique one; we seldom have the satisfaction of yielding a direct benefit, which is directly received. But rectitude scatters favors on every side without knowing it, and receives with wonder the thanks of all people.

I fear to breathe any treason against the majesty of love, which is the genius and god of gifts, and to whom we must not affect to prescribe. Let him give kingdoms or flower-leaves indifferently. There are persons, from whom we always expect fairy tokens; let us not cease to expect them. This is prerogative, and not to be limited by our municipal rules. For the rest, I like to see that we cannot be bought and sold. The best of hospitality and of generosity is also not in the will, but in fate. I find that I am not much to you; you do not need me; you do not feel me; then am I thrust out of doors, though you proffer me house and lands. No services are of any value, but only likeness. When I have attempted to join myself to others by services, it proved an intellectual trick,– no more. They eat your service like apples, and leave you out. But love them, and they feel you, and delight in you all the time.

Friday Nov 25 2022

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Friday Nov 25 2022

A federal judge recommended that Theranos Inc. founder Elizabeth Holmes serve her more than 11-year sentence in a minimum-security prison camp in Texas, new court filings show.

U.S. District Judge Edward Davila, who oversaw the trial and sentenced her on Friday, ordered Ms. Holmes to surrender to the facility in April. He also recommended that she be allowed family visitation, saying that it enhanced the possibility for rehabilitation. Upon release, Ms. Holmes would serve three years under court supervision, the judge said.

Before Black Friday

But it is a cold, lifeless business when you go to the shops to buy me something, which does not represent your life and talent, but a goldsmith’s. This is fit for kings, and rich men who represent kings, and a false state of property, to make presents of gold and silver stuffs, as a kind of symbolical sin-offering, or payment of black-mail.

I have posted this essay since 2009

 before the nonsense of Black Friday, the shopping day after Thanksgiving Day''

Ralph got it right in  1841 as well as he does today

It is said that the world is in a state of bankruptcy, that the world owes the world more than the world can pay, and ought to go into chancery, and be sold. I do not think this general insolvency, which involves in some sort all the population, to be the reason of the difficulty experienced at Christmas and New Year, and other times, in bestowing gifts; since it is always so pleasant to be generous, though very vexatious to pay debts. But the impediment lies in the choosing. If, at any time, it comes into my head, that a present is due from me to somebody, I am puzzled what to give, until the opportunity is gone. Flowers and fruits are always fit presents; flowers, because they are a proud assertion that a ray of beauty outvalues all the utilities of the world. These gay natures contrast with the somewhat stern countenance of ordinary nature: they are like music heard out of a work-house. Nature does not cocker us: we are children, not pets: she is not fond: everything is dealt to us without fear or favor, after severe universal laws. Yet these delicate flowers look like the frolic and interference of love and beauty. Men use to tell us that we love flattery, even though we are not deceived by it, because it shows that we are of importance enough to be courted. Something like that pleasure, the flowers give us: what am I to whom these sweet hints are addressed? Fruits are acceptable gifts, because they are the flower of commodities, and admit of fantastic values being attached to them. If a man should send to me to come a hundred miles to visit him, and should set before me a basket of fine summerfruit, I should think there was some proportion between the labor and the reward. For common gifts, necessity makes pertinences and beauty every day, and one is glad when an imperative leaves him no option, since if the man at the door have no shoes, you have not to consider whether you could procure him a paint-box. And as it is always pleasing to see a man eat bread, or drink water, in the house or out of doors, so it is always a great satisfaction to supply these first wants. Necessity does everything well. In our condition of universal dependence, it seems heroic to let the petitioner be the judge of his necessity, and to give all that is asked, though at great inconvenience. If it be a fantastic desire, it is better to leave to others the office of punishing him. I can think of many parts I should prefer playing to that of the Furies. Next to things of necessity, the rule for a gift, which one of my friends prescribed, is, that we might convey to some person that which properly belonged to his character, and was easily associated with him in thought. But our tokens of compliment and love are for the most part barbarous. Rings and other jewels are not gifts, but apologies for gifts. The only gift is a portion of thyself. Thou must bleed for me. Therefore the poet brings his poem; the shepherd, his lamb; the farmer, corn; the miner, a gem; the sailor, coral and shells; the painter, his picture; the girl, a handkerchief of her own sewing. This is right and pleasing, for it restores society in so far to its primary basis, when a man’s biography is conveyed in his gift, and every man’s wealth is an index of his merit. But it is a cold, lifeless business when you go to the shops to buy me something, which does not represent your life and talent, but a goldsmith’s. This is fit for kings, and rich men who represent kings, and a false state of property, to make presents of gold and silver stuffs, as a kind of symbolical sin-offering, or payment of black-mail.

The law of benefits is a difficult channel, which requires careful sailing, or rude boats. It is not the office of a man to receive gifts. How dare you give them? We wish to be self-sustained. We do not quite forgive a giver. The hand that feeds us is in some danger of being bitten. We can receive anything from love, for that is a way of receiving it from ourselves; but not from any one who assumes to bestow. We sometimes hate the meat which we eat, because there seems something of degrading dependence in living by it.

“Brother, if Jove to thee a present make,
Take heed that from his hands thou nothing take.”

We ask the whole. Nothing less will content us. We arraign society, if it do not give us besides earth, and fire, and water, opportunity, love, reverence, and objects of veneration.

He is a good man, who can receive a gift well. We are either glad or sorry at a gift, and both emotions are unbecoming. Some violence, I think, is done, some degradation borne, when I rejoice or grieve at a gift. I am sorry when my independence is invaded, or when a gift comes from such as do not know my spirit, and so the act is not supported; and if the gift pleases me overmuch, then I should be ashamed that the donor should read my heart, and see that I love his commodity, and not him. The gift, to be true, must be the flowing of the giver unto me, correspondent to my flowing unto him. When the waters are at level, then my goods pass to him, and his to me. All his are mine, all mine his. I say to him, How can you give me this pot of oil, or this flagon of wine, when all your oil and wine is mine, which belief of mine this gift seems to deny? Hence the fitness of beautiful, not useful things for gifts. This giving is flat usurpation, and therefore when the beneficiary is ungrateful, as all beneficiaries hate all Timons, not at all considering the value of the gift, but looking back to the greater store it was taken from, I rather sympathize with the beneficiary, than with the anger of my lord Timon. For, the expectation of gratitude is mean, and is continually punished by the total insensibility of the obliged person. It is a great happiness to get off without injury and heart-burning, from one who has had the ill luck to be served by you. It is a very onerous business, this of being served, and the debtor naturally wishes to give you a slap. A golden text for these gentlemen is that which I so admire in the Buddhist, who never thanks, and who says, “Do not flatter your benefactors.”

The reason of these discords I conceive to be, that there is no commensurability between a man and any gift. You cannot give anything to a magnanimous person. After you have served him, he at once puts you in debt by his magnanimity. The service a man renders his friend is trivial and selfish, compared with the service he knows his friend stood in readiness to yield him, alike before he had begun to serve his friend, and now also. Compared with that good-will I bear my friend, the benefit it is in my power to render him seems small. Besides, our action on each other, good as well as evil, is so incidental and at random, that we can seldom hear the acknowledgments of any person who would thank us for a benefit, without some shame and humiliation. We can rarely strike a direct stroke, but must be content with an oblique one; we seldom have the satisfaction of yielding a direct benefit, which is directly received. But rectitude scatters favors on every side without knowing it, and receives with wonder the thanks of all people.

I fear to breathe any treason against the majesty of love, which is the genius and god of gifts, and to whom we must not affect to prescribe. Let him give kingdoms or flower-leaves indifferently. There are persons, from whom we always expect fairy tokens; let us not cease to expect them. This is prerogative, and not to be limited by our municipal rules. For the rest, I like to see that we cannot be bought and sold. The best of hospitality and of generosity is also not in the will, but in fate. I find that I am not much to you; you do not need me; you do not feel me; then am I thrust out of doors, though you proffer me house and lands. No services are of any value, but only likeness. When I have attempted to join myself to others by services, it proved an intellectual trick, — no more. They eat your service like apples, and leave you out. But love them, and they feel you, and delight in you all the time.

https://www.justice.gov/usao-wdtx/pr/former-san-antonio-bookkeeper-sentenced-stealing-16-million

87 months to do for theft

Thursday Nov 17 2022

Here Are the Wildest Parts of the New FTX Bankruptcy Filing

“Never in my career have I seen such a complete failure of corporate controls…”

November 17, 2022 at 8:42 AM EST

Bloomberg

Lawyers for the bankrupt crypto exchange FTX filed today in Delaware, asking a federal judge to transfer a competing bankruptcy case filed in New York by Bahamian liquidators to the state.

The filing, led by new CEO and chief restructuring officer for FTX, John Ray, is quite something.

Here, for instance, is Ray blasting former FTX CEO Sam Bankman-Fried (our emphasis throughout):

I have over 40 years of legal and restructuring experience.  I have been the Chief Restructuring Officer or Chief Executive Officer in several of the largest corporate failures in history.  I have supervised situations involving allegations of criminal activity and malfeasance (Enron).  I have supervised situations involving novel financial structures (Enron and Residential Capital) and cross-border asset recovery and maximization (Nortel and Overseas Shipholding). Nearly every situation in which I have been involved has been characterized by defects of some sort in internal controls, regulatory compliance, human resources and systems integrity. Never in my career have I seen such a complete failure of corporate controls and such a complete absence of trustworthy financial information as occurred here.  From compromised systems integrity and faulty regulatory oversight abroad, to the concentration of control in the hands of a very small group of inexperienced, unsophisticated and potentially compromised individuals, this situation is unprecedented.

FTX, once the world’s second biggest crypto-exchange, filed for Chapter 11 bankruptcy protection last week following a stunningly swift collapse that has sparked the unwinding of Bankman-Fried’s erstwhile crypto empire and an ongoing series of revelations about how it was run.

The first day bankruptcy filing paints a picture of a chaotically-run web of intertwined companies, including potentially serious lack of controls around spending both corporate and client money. 

Here is a footnote which reveals a tangled web of lending between Alameda Research and other entities, including potentially billions of dollars worth of loans made to Bankman-Fried himself:

There is some talk of FTX assets having been sent to the Bahamian government:

In addition, in connection with investigating a hack on Sunday, November 13, Mr. Bankman-Fried and Mr. Wang stated in recorded and verified texts that “Bahamas regulators” instructed that certain post-petition transfers of Debtor assets be made by Mr. Wang and Mr. Bankman-Fried (who the Debtors understand were both effectively in the custody of Bahamas authorities) and that such assets were “custodied on FireBlocks under control of Bahamian gov’t”  … The Debtors thus have credible evidence that the Bahamian government is responsible for directing unauthorized access to the Debtors’ systems for the purpose of obtaining digital assets of the Debtors—that took place after the commencement of these cases …

And here’s some color regarding spending controls within the crypto exchange FTX:

The Debtors did not have the type of disbursement controls that I believe are appropriate for a business enterprise.  For example, employees of the FTX Group submitted payment requests through an online ‘chat’ platform where a disparate group of supervisors approved disbursements by responding with personalized emojis. In the Bahamas, I understand that corporate funds of the FTX Group were used to purchase homes and other personal items for employees and advisors.  I understand that there does not appear to be documentation for certain of these transactions as loans, and that certain real estate was recorded in the personal name of these employees and advisors on the records of the Bahamas.

The crypto tokens held by FTX.com are now being valued at just $659,000, compared to the billions Bankman-Fried was valuing them at in a term sheet leaked last week. (The filing splits FTX’s businesses into two major units, the Dotcom Silo [which includes FTX.com] and the Ventures Silo which includes various companies managing investments.

It seems FTX.com wasn’t including customer liabilities in its financial statements:

To my knowledge, the Dotcom Silo Debtors do not have any long-term or funded debt.  The Dotcom Silo Debtors may have significant liabilities to customers through the FTX.com platform.  However, such liabilities are not reflected in the financial statements prepared by these companies while they were under the control of Mr. Bankman-Fried.  The chart below summarizes certain information regarding the Dotcom Silo’s consolidated liabilities as reflected in the September 30, 2022 balance sheet: 

Cash management also seems to have left something to be desired:

The FTX Group did not maintain centralized control of its cash.  Cash management procedural failures included the absence of an accurate list of bank accounts and account signatories, as well as insufficient attention to the creditworthiness of banking partners around the world.  Under my direction, the Debtors are establishing a centralized cash management system with proper controls and reporting mechanisms … Because of historical cash management failures, the Debtors do not yet know the exact amount of cash that the FTX Group held as of the Petition Date.  The Debtors are working with Alvarez & Marsal to verify all cash positions.  To date, it has been possible to approximate the following balances as of the Petition Date based on available books and records: 

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