The corporate veil should provide enough protection from random and unforeseeable failures to encourage entrepreneurship, but not enough that it shields wrongdoers from consequences. Currently it shields nearly everyone from everything in nearly all cases from run-of-the-mill business failure all the way up to straight-up fraud.
It doesn’t shield small business owners in practice, though. Bank loans tend to require personal liability, and there are ways to pierce the corporate veil when the company is provably one person. So individuals get only a small amount of protection in practice. Even if you fail in good faith, there’s a good chance that your life and reputation are ruined.
On the other hand, large companies are basically private armies in which the presumably passive shareholders are so distant from the actions taken on their benefit that people almost never go to jail unless they are deliberately thrown to the wolves by shareholders or superiors.
Bill Hwang and SBF committed the cardinal sin of business: losing other rich people's money. They both ran out of friends very quickly. Elizabeth Holmes was the same.
The problem is that only 0.01% of the people who need to be held accountable are. The number isn’t zero, clearly, but how many of the people who caused the 2008 disaster ended up in prison? My point exactly.
I also think it’s clear that SBF was jailed for his effects on the rich rather than on average people. Worse than fleecing billionaires, he made them look bad. Clearly he’s a scumbag who deserves prison time, but people worse than him are free.
>but how many of the people who caused the 2008 disaster ended up in prison? My point exactly.
>I also think it’s clear that SBF was jailed for his effects on the rich rather than on average people. Worse than fleecing billionaires, he made them look bad.
"The rich" was upset enough at SBF losing $32 billion to throw the book at him, but are totally fine with the GFC causing $2 trillion in damage to the global economy?
