This is a great opportunity for McClure to do some product market research and sell products to the bureau.

It's rare that such a large organization comes to YOU for a PROBLEM that they are having and not just go DIRECTLY to ya MAMA (or the bank):

#1 Take chances. The other guy who didn't got off scotch free with no time serving (web requests, ya twitter stream, nothin!).

#2 Hold ya own. Fast talkin ain't just for the guy on the other side of the table. Let him know you have a dictionary and thesaurus too. Don't pull them out so fast though!

#3 Haters hate, but you gotta love. If you aren't allowed to leave the room to get coffee suggest a friendly game of thumb wars.

This really doesn’t have the same panache without the variable-sized red and green letters.

Yeah, I cried a river that I couldn't express myself like that. Fake McClure blog in the works? Maybe.

I feel like this isn't going to go anywhere- after all, you can't prosecute someone based on vague tweets and a witness (Arrington) that felt awkward. It's possibly a few of the "uncomfortable" Angels will step forward with more evidence, but I'm not convinced there's enough evidence to make a real case out of it.

But then again, all I really know comes from TechCrunch blog posts.

You can however investigate based on such evidence. There are at least 10 people involved. Each of them can be interviewed and they will have extensive cell phone records, email, personal correspondence and financial transactions that can be subpoenaed.

Evidence for many (maybe most) cases is gathered at the interrogation stage. The larger the group the likelier it is that an investigation involving talking to the people there will uncover everything.

Cops can be good at their jobs.

Not only that, you would be amazed at how many people who have done something wrong end up with a guilty conscience and just tell the truth. Especially if there was something wrong going on here and the FBI hangs the "first to tell me what happened won't be prosecuted".

I would have thought that top VC's would be smart not to say a word about this that isn't vetted by their lawyers. Except maybe Dave McClure :-P

Err, the other obvious explanation is that whoever was at these meeting really don't have anything to hide, and Arrington is grossly exaggerating the few anonymous tips he's gotten.

All depends on whether what's come out so far is enough to convince a judge to issue subpoenas.

From the peHUB post[0] cited in the article: >Arrington declined to say if he had been contacted by law enforcement officials.

Could law enforcement force Arrington's silence if he was contacted directly? Or can we expect another post by him titled, "So the FBI walked into my office..."?

[0] http://www.pehub.com/83069/angelgate-is-“100-percent-accurat...

The answer is whatever creates more buzz - "declined to say" is the most "interesting" way to say no.

In some contexts, I belive they called those "National Security Letters".

I have to plead some ignorance on this one: I'm familiar with Australian securities law (at a very high level) but American securities law is of course quite something else.

Price-fixing I'm not sure applies here. It normally applies on the sell side but not the buy side. So if all the gas stations in the country said they would charge $6/gallon that would be price fixing. If all the consumers said they wouldn't pay more than $1.50/gallon then that's not price-fixing in the same sense.

But which side the angel investors are treated as is open to interpretation. It's also worth noting that this is investment rather than the sale of goods or services so price-fixing, depending on the law, may not even apply.

Collusion is a little more interesting. Australia has very strict laws here compared to the US (to both our benefit and detriment I suspect). I'm not even sure how to begin at unravelling such a thing.

It strikes me a little odd that it's the FBI spearheading this. I would've thought the FTC and/or the SEC would've been at the front of this. The FBI means the DoJ doesn't it? Or is the FBI the enforcement arm for these kinds of actions?

One disturbing possibility that would require FBI intervention: racketeering. Take a look at RICO:

http://en.wikipedia.org/wiki/Racketeer_Influenced_and_Corrup...

Trigger offences include securities fraud:

http://en.wikipedia.org/wiki/Securities_fraud

"Securities fraud, also known as stock fraud and investment fraud, is a practice that induces investors to make purchase or sale decisions on the basis of false information, frequently resulting in losses, in violation of the securities laws."

Now that normally applies to companies but could it be applied to the enticement of other investors? If angel A puts in money at $3m pre-money while at the same time someone else is putting in money at $4m pre-money, enticed by angel A (without A disclosing his or her better deal), couldn't that qualify as securities fraud?

IANAL and it seems unlikely but when you get any securities malfeasance or the appearance thereof the whole thing can really spider in all sorts of unexpected directions.

Insert grellas here: http://news.ycombinator.com/item?id=1716285

> So if all the gas stations in the country said they would charge $6/gallon that would be price fixing. If all the consumers said they wouldn't pay more than $1.50/gallon then that's not price-fixing in the same sense.

That's probably true with those examples, but antitrust law tends to ignore large groups of individuals "colluding" in their personal retail purchases. Companies that together exert significant market power get more scrutiny, though; for example, if all the gas-station owners in Texas got together and said that they wouldn't pay more than $1.50/gallon wholesale for gas from refineries, that could be a Sherman Act violation. There have been a few cases about "group boycotts" as well; whereas consumers can organize boycotts for political or personal or whatever reasons, groups of companies organizing boycotts of other companies will attract investigators looking into whether the purpose of the boycott is market distortion.

I certainly don't claim the authority to determine if the Sherman Act applies in this case (or in fact any case).

To summarize my earlier post the most interesting thing about this is that the FBI is leading an investigation on this (if the story is true and indeed "Angelgate" is the subject of that investigation). The FBI having jurisdiction raises all sorts of interesting questions.

The lesser point was that the FBI investigates racketeering and the RICO statutes have very broad application as written whether or not they've been used that way to date.

Take the Sotheby's/Christie's price-fixing case. That was a civil matter was it not? It bears some similarity to this (an important difference being that the auction houses were providing a service whereas the angels are investing, which legally speaking isn't quite the same thing).

I may smack the next journalist that uses the -gate suffix in a title.

smackgate!

Rape and murder are violent crimes. Smacking someone causes them minor pain that subsides within seconds. It's something you shouldn't do, but it's not violent. Talking about it in an abstract sense is not something that is particularly shameful.

Using this action as a literary device is not offensive. Saying "I want to smack someone" acts to convey a desire to show someone that their actions are wrong, like a parent reprimanding a child for finger-painting all over the walls.

Honestly, in this situation, I find it appropriate. "I think using the suffix -gate to describe a scandal is silly" doesn't have the same emotional and visceral effect as "I want to smack these guys", even though the OP probably means the former.

Writing is about conveying emotion just as much as conveying literal facts and desires.

I never suggested hitting a child. I said the expression "I want to smack..." conveys an emotion like a parent reprimanding a child. The emotion is one of "talking down", not one of hitting someone, even though that's what a literal reading means.

What I hate about HN is that very few people here seem to be able to understand that the written word can be interpreted in many ways. What the words literally mean is not what the combination of those words means.

And that the excuse "hitting children is educational" is false.

But actually, I assume you're just trolling. I know because you are "anticipating" future arguments that have absolutely nothing to do with the comment thread. The OP used a figure of speech. I mentioned parents and kids. Now you want to have a debate on parenting philosophy?

What for? To waste my time?

Well, it worked, but now you have several fewer karma points and I have several more.

Look: I didn't say parents should hit their kids. I didn't say parents shouldn't hit their kids. Nowhere in anything I've said in this thread, did I bring this subject up. I have no opinion on this matter and don't care to discuss it.

Please find some other comment thread to reply to.

haters gonna hate, players gonna play and the FBI is gonna investigate

They don't have a choice - it's their job... So what do you think, will the FBI investigation play out to be good or bad for us entrepreneurs?

If you are a VC who was at those meetings, and you are on your blog loudly claiming nothing illegal was going down, I guess you'll be directly answering all the FBI's questions instead of letting a lawyer do the talking for you, right?

I didn't think so.

The bad thing is, even if the conversations were innocent, the FBI does not let go easily. Things start nice... "just want to make sure we clear up any misunderstandings..." and then there are wiretaps, and more fun. Good luck.

Evidence for many (maybe most) cases is gathered at the interrogation stage. The larger the group the likelier it is that an investigation involving talking to the people there will uncover everything.

www.homadynamic.com