

Ask HN: How much corruption do you let slide at a startup? - throwedaway

I&#x27;m in a bind here and looking for advice.  I lead engineering at a startup that had one of its employees impersonate a high level exec at a Fortune 50 company in order to give a good recommendation when we had no legit ones to give.<p>What is the recommended way to deal with such a situation?
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throwedaway
Obviously I should leave a morally bankrupt company, but I'm pissed off that
one bad decision by management ruins 3.5 years of blood, sweat, and tears that
I've poured into the company. Is there any legal avenues I should pursue or
just wash my hands of it and part ways?

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dfraser992
I've posted about my situation before, but the same general topic keeps coming
up.... I was hired to build a website and somehow it turned into a B2B startup
after 4 years - and I alone was 95% of the staff. "Cash flow problems" I was
told, "can't hire anyone else right now"...

When the CEO was caught blatantly lying to a customer to make a sale, it
became clear about the totality of the situation - he's a full blown
sociopath, I just hadn't put it all together, but kept picking up clues. Then
the guy who introduced me to him finally told me about how this CEO
deliberately got fired from Goodyear in France back in the 80s, when such a
thing was impossible (France's unemployment laws and all), he then moved to
England and defrauded the French government of unemployment insurance for over
a year. The amount of risk taking there...! Like I said, Patrick Bateman from
American Psycho isn't much of an exaggeration of this guy's behavioral
patterns and character. I'm serious... Then I realized how I'd been
manipulated for 4 years.

I was so fried after all the stress I didn't think through things enough and I
quit, after some months of hassle dealing with his wife over getting paid for
the outstanding invoices. She was Marie Antoinette Macbeth... 4 years of my
life down the drain.

I'm in a bit of a pickle now as I'm still burnt out, and am finding it hard to
get interviews or survive them. I'm too old to get some worker bee job in a
tech company now, I fear, and I can't stand IT at some level. This is one hell
of a mid life crisis...

But my conscience is clear. The rational thing to do would have been to keep
working there and overcharge them on the hourly rate, which I could have
without any trouble (given I was 90% of the It staff with no supervision). But
then I'd be playing their game... But I could have spent my time mostly
looking for another job. But the stress and everything else... I'd be waking
up every morning pissed as hell. Not a good thing. I sort of wish I had now,
but it's because things are getting dicey for me on a personal level. I have
the resources to stay afloat for another year, so I'm shouldn't complain but I
hate burning savings.

So my advice is think this through first and decide how to find another job or
what you will do before quitting. I was too impulsive. I can relate to the
'blood, sweat and tears" too since I realized the founders were lazy people
who let me do all the work and didn't give a damn about anything but money
(this was a 4 person company, and I the only one w/o equity). but you have to
let it go - if you don't have any equity, and the people you deal with have no
ethics, you will get screwed every which way, even for the sheer fun of it
possibly. What's to stop them from manipulating you? People like this do not
have any internal brakes on what they will do or rationalize away. How do you
know this is the only morally bankrupt decision they have made?

To actually answer your question, how have you been legally impacted by their
actions? I'm not sure you could make a case. If you have equity, then figure
out how to extract yourself without triggering their alarm bells that you're
leaving because you know they are bastards. If you don't have any sort of
financial stake in the company (like I did) and can't claim damages (e.g. I
was paid for my time, just constantly late), then walk away. I couldn't make a
case that I had any claim to equity or etc. The law does not care about
philosophical stuff like ethical treatment of employees or contractors unless
the situation is very clear cut, like sexual harassment. Manipulation of
people is entirely legal. So if there is no money involved, or broken
contracts, you don't have any legal avenues.

I do wish I had thought things through and been better able to reveal to the
customer who got screwed about the situation - I ended up saving the contract
by writing the system to generate the data they thought they'd paid for, but I
was in a bind - either not do that and have the customer sue the company (and
never get my invoices paid) or do this and get my invoices paid and then quit.
Do you feel any sense of responsibility or guilt about what was done? You
shouldn't. I did, now that I realize this, and that drove my actions
(unconsciously). I would do so many things differently now...

so perhaps you can inform the person who was impersonated somehow? Then your
sense of duty to do something has been dealt with and the people directly
affected can decide what to do.

~~~
dfraser992
Edit: reading this a few hours later, obviously I need to spend some of the
money I did make going to therapy. My anal retentive analytical powers, honed
over years of programming, are getting in the way. Figure out how to let go
and walk away without going down a rabbit hole...

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mchannon
Assuming this is "an employee" and not CEO or someone you report to, use your
corporate structure in its intended fashion- draft a memorandum to the CEO,
who is typically the sort of person who has to make these decisions, don't
spend all day drafting it, and get back to work.

According to what you've written, you lead engineering. Unless you're somehow
complicit in the deception, you're blameless as long as you pass that
information on, because engineering doesn't involve recommendations.

I would imagine most CEO's would quietly correct/retract the recommendation,
and take up (or not) the issue with the employee. There's your fix right
there. If they fail to, that says more about their leadership than a rogue
employee does, and either way, probably time to start looking for a move up to
somewhere else. 3-4 years is the longest you should be working somewhere
without substantial financial reason to stay. The cachet of a long time in a
position saturates out at about 3-4 and unless you plan to retire in this
position, you'll be in a weaker negotiating position with 5, 10, or 20 years
in the same job.

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l0gicpath
A resignation is one option. If the act was carried out with approval of the
share holders and/or investors (though I doubt any decent investor would
condone such behavior) then you have two options:

\- depending on the severity of the action, this is identity theft and
punishable by law. If you have indicting proof, report it

\- if it poses harm to your career in anyway, think of your family and usually
the safest route is to resign

If it was carried out without approval, report the employee.

But by all means, _don 't turn a blind eye at it_ unless you really have to.

There is a funny thing about corruption, it's the same every where. Nothing
would be special or particularly harmless about it be it in a startup or a
larger organization.

Best of luck

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bcx
Sometimes smart people do dumb things.

Tell management how you feel about the dishonesty.

Perhaps they could come clean to the potential client, and/or figure out how
to make sure something like this never happens again.

Depending on the structure of the company (it sounds like you might be in a
small company) it probably is time for some people to go, or at least take
some time off and figure out their moral compasses.

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mesozoic
Get rid of him right away is how I'd handle it. You're on a very slippery
slope that doesn't just lead to failure it leads to jail time.

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lifeisstillgood
How much of this is "building an audience" For example Paypal pretending to be
legitimate buyers and purchasing eBay goods but only via paypal? Or reddit
posting stories and comments under sock puppet accounts?

If this was a clear impersonation of a specific individual then it is a
serious fraud (presumably the company expects financial gain). If it is "These
guys are amazing - A Fortune 50 CTO" then half of Hollywood does it every day.

I think that morally overdrawn is the natural state of much of the business
world - morally bankrupt is rarer.

So for some actual advice - if it was a crime, report it and leave. If you
cannot stomach the ethics even if it is not criminal, then prepare a good
resignation letter and leave - but I would counsel that in doing so you are
setting a tremendously high bar for your future behaviour - which is a good
thing but it has implications. I would suggest making a public note on your
leaving and reasons maybe on your blog. no point in being ethical if no one
notices.

but lastly I would look inside yourself - are there any other reasons why the
last three and a half years have upset you? What decisions did you not agree
with - what relationships have gone sour? Is this all plain sailing then one
horrible fraud? if so it seems out of character for the company? if not then
what things have lead to this - for example this sort of behaviour is usually
seen under real stress, so why did the company end up not getting the sales
last year, what shortcuts in engineering have lead to a lower product, what
lack of marketing ab tests lead to lack of a sales pipeline?

This maybe the right wake up call the company needs to turn around - do you
want that? Or do you think this is not a wake up call but the last straw?

I am rambling on but I have found many ethical decisions rarely come out of
simplicity and rarely have simple resolutions.

good luck

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jpwright
> no point in being ethical if no one notices.

No meaning to ethics if this is your philosophy.

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SamReidHughes
> No meaning to ethics if this is your philosophy.

What's the basis for the belief (you seem to hold) that it's more ethical to
silently tolerate unethical practices instead of outing them publicly?

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jaredsohn
I don't think the GP is saying that; I think the GP is saying that to be
ethical you do something that is right regardless of if you get credit for it.

And in practice, publicly stating that you turned in your company for
something (even if morally right) can hurt you when you apply to other
companies since if they learn of it they are likely wondering if you would
accuse them of something if you worked there.

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toadi
This is ethical and that is not ethical doesn't exist as discussion: "ethics
does not provide rules like morals but it can be used as a means to determine
moral values"

The way it should be stated it's against my moral values. Not everyone's moral
values are aligned. Thus rendering this discussion unusable for me as I don't
know against what moral value we are judging these actions.

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SamReidHughes
Ethical has exactly the same meaning as moral outside of specific contexts.

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NonEUCitizen
Leave.

