How Much Fraud Can a Fraudster Fraud?

Matt Levine, in his Money Stuff column for Bloomberg:

And so when Holmes was charged with wire fraud, it was for a mix of investor fraud and patient fraud. “Jurors heard Theranos patients testify their blood-test results falsely led them to believe they had unhealthy conditions,” but found Holmes not guilty on those counts. I don’t know why — I was not at the trial, and I certainly wasn’t in the jury room — but it seems plausible that Holmes was less personally culpable for those tests than she was for her own pitches to investors. But never mind that.

Instead, my point here is that if you do a fake blood test on a patient, you have arguably defrauded him (though Holmes was acquitted of that), but how much have you defrauded him really? Arguably the answer is quite a lot; arguably he is quite badly harmed by thinking he had a deadly disease and taking drastic steps to fight it, or thinking he did not have a deadly disease and missing the chance to fight it. But arguably the answer is $14.95, or whatever he paid for the blood test (I made that number up): You were doing fraud for money, and the money you got from any one patient is fairly small. Whereas the money you got from Betsy DeVos was $100 million.

★ Tuesday, 4 January 2022