Comment by kristianp

3 days ago

Reminds me of small mining exploration companies in Australia's ASX. Most only exist to pay for the directors' lifestyles.

4 comments

kristianp

Isn’t there this whole weird economy of empty pink sheet companies that just act as lifestyle funding for people?

dfedbeef 2 days ago

If by lifestyle funding you mean money laundering and tax write-offs. Have a bunch of legal-or-otherwise income? You need one person in a suit who can register a company and shuffle paper around. A bunch of retirees or something somewhere paid $1 each to your company. They even paid in cash. Hooray. Now you are a successful legal business person minus the filing fee.
Now, you're so successful you don't want to pay taxes or get audited. Your business made N dollars this year. You spent it all investing in some long term investment on paper. Damn, your businesses didn't make money now. No taxes I guess, takes money to make money. Hopefully that long term investment in several shell companies in different jurisdictions works out. Hopefully law enforcement isn't resourced enough to track it down.
Who suffers? Literally everyone else who pays into a system that's supposed to be fair. There's a tipping point where no people who make money pay into it. I suspect this has kind of already occurred tbh.

How does that work? Is there anything you can point me to where I can read more about this?

I, naively, would have assumed that publicly listing your company would be anathema if you're up to sketchy shenanigans.