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Peachy Printer Funds Embezzled To Build New Home Instead of $100 3D Printer (hackaday.com)
Reader szczys writes (edited): Peachy Printer made it big on Kickstarter, raising over half a million dollars on the promise to build the first 3D printer and scanner costing $100. The company has now collapsed due to embezzlement (Editor's note: BBC's coverage is better) of those funds. The original investor stole around $350,000 of backer's money and funneled it into a new home. This was discovered about 18 months ago but became public only now as the company is unable to meet their already delayed delivery dates. Peachy Printer has posted a video admitting the screw-up. Sounds familiar?
Is there any precedent for legal action against someone for doing this? Or can I just make a kickstarter, never fulfill it at all, buy a new car and there's no consequences?
I'm shocked! Shocked that anyone on Kickstarter would steal people's money to build a house when they could steal people's money to build a company. Remember the advice of the great philosophers Mr. T and Nelson.
I'm an American. I love this country and the freedoms that we used to have.
I am utterly shocked, that they didn't use the fund to build the printers and use the printer to print parts for the house...
ELOI, ELOI, LAMA SABACHTHANI!?
Why not sell the house and make it right?
That video was the funniest thing i have seen in years =)
teh omg kekekekkekekekekeke!!!!11shift!!!1one11eleven
Well, a significant difference between this situation and the iFind is that the Peachy Printer actually works. It even works well, compared to the $800+ solidoodle at our hackerspace. It was working well enough to clean up the design and start shipping kits back in January 2015. Sadly, that also coincided with discovering the money reserved for actually making the printers was held up as collateral for David's house. (which turned out to not be the truth anyway) David kept stringing us along for a while, while Rylan explored other ways to raise some money to ship. And, if you've watched the videos and read the website you know the rest.
Peachy printer backers, don't fret. I'll be launching a Kickstarter soon for a printer which can print an entire house. Back me for $100 and I'll post an approximate sketch of the house. Back me for $500 and I'll send you photocopies of the plans. Back me for $1000 (top tier Rube Level) and I'll send you a postcard from the country it's located in. Act now!
Sell the house and give the money back. Saying "I'm sorry" is just stupid and why does his friend seem to accept it. Something huge is missing from this story.
Of fraud and embezzlement, which I'm pretty sure is covered by existing criminal codes.
I guess the next question is which jurisdiction is going to charge them?
Where are we going and why are we in a handbasket?
They deleted a dupe. This is a good thing. Please go away.
If video games influenced behavior the Pac Man generation would be eating pills and running away from their problems.
are soon parted
Most Kickstarters don't even produce a house.
SJW's don't eliminate discrimination. They just expropriate it for themselves.
I thought at the time and still do in many ways that this product was to good to be true. I had some hope that this would turn out good, but I am a pragmatist when it comes to revolutionary products that go on crowed founding sites, excely at the price point they choose. When you compare it to other SLA based printers and their cost. Even the SeeMeCNC SLA printer kit was around $400 and you still needed to provide a DLP projector. As they say buyer beware. Always take what you see as a grain of salt and don't asume that it is real.
Does anyone have a Google Maps link to this house.
Depending on the location, it might be profitable under Airbnb.
Even if the article is a dupe, deleting it is not a good thing if there are unique comments attached to it!
One of the best features of Slashdot compared to just about every other comment system on the Internet is that posts are (supposed to be) immutable and accessible forever, perhaps modded down but never deleted.
"[Regarding the 'cloud,'] ownership was what made America different than Russia." -- Woz
No, it is not a good thing. Slashdot's only redeeming value is its archived comments. Go use snapchat if you want your shit to disappear.
I don't know Canadian law, but in some Western countries, embezzlement of this sort would be considered a crime. So, even if there is no recourse for contributors, if the guy goes to jail it may deter other Canadians from pulling a stunt like this.
As for investors, no, there probably isn't any legal recourse. However, the others running the project probably have grounds to sue him for the actual funds plus a separate action for taking actions that he knew, or should have known, would hurt the reputation of the others who were running the project. Unless the value of the house is high enough to recover the lost money though, "good luck" collecting any damages.
Knowledge is how to play a game, intelligence is how to win, wisdom is knowing what game to play.
3D print a new house, since I've been told this is routine technology now.
Hmm, thanks for posting a link to the deleted content this time.
If they went oops and published a dupe without the usual 12-36 hour waiting period, they should have edited the story instead of removing it and said something like "Hey guys, our bad. We forgot to wait a few days before posting this again!"
You wouldn't download a house.
I would if it had a nice sunroom.
SJW's don't eliminate discrimination. They just expropriate it for themselves.
They deleted a dupe. If you write to the provided address they will respond with the correct URL: https://science.slashdot.org/s...
CAUTION: You might need to do this in a calm and reasonable manner, calling them assholes might not be productive.
I'm an American. I love this country and the freedoms that we used to have.
One of the things that stuck in my mind about the video (aside from the cheesy feel sorry for me video editing) was that he said they didn't have a corporate account for the funds to arrive in, so they chose his personal account?
I live in a 3rd world country (South Africa), and it takes me 1 minute to set up a new bank account with shared access credentials with my existing bank. This means the account is completely separate from all other of my accounts, and I can create as many logins as I want for it with as much access as I want (read-only, read-write, which accounts they can see etc). This has proved massively useful when sharing a household with others. Open an account and set up access profiles for spending for certain people in 30min. Why can't people doing Kickstarter type campaigns do the same when they are trying to start a business.
And we've got a whole generation to bilk.
Isn't that just Peachy?
Someone who has read Kickstarter's terms more recently will need to chime in. But I was under the impression that as a contributor, you are basically just donating your money for nothing more than a promise. When I read through the EULA long ago, I seem to recall something about acknowledging the project may fail and I may see nothing in return for my money.
That's one of the things I don't like about the current crop of crowd-funding sites. They're slanted very much in favor of the recipient and against the donor. With most VC funding, the donor gets partial ownership of the company in exchange for their money, if not a say in how the company is run. Crowdsourcing right now is the donor takes all the risk, while the project owners reap all the rewards. It baffles me that the Internet, which usually slants heavily left on issues like this, tolerates it. Maybe people are thinking of it in terms of large VC firms vs. little guys in the garage trying to get their project rolling? Well, why do you think VC firms became so big? So donors could pool their resources to detect scammers and crooks who'd make empty promises to try to take your money.
They deleted a dupe.
Well, they shouldn't. They should archive it to preserve the comments. Without indelible comments this place is completely worthless, just another bullshit aggregator.
And in the new age Trump, being "calm and reasonable" will get you nowhere. You have to light a firecracker under their ass to get a response.
Love the idea of Kickstarter because most people are nice and want to do nice, but... The lack of accountability is a FATAL flaw in the implementation.
So here's a constructive suggestion for a solution I call the "charity share brokerage":
The brokerage will earn a commission on the funded projects based on providing IMPORTANT supporting services for proposal preparation and evaluation of the results. In particular, the brokerage will make sure that EACH proposal has:
1. A realistic schedule
2. An adequate budget
3. The critical resources (including the people) and all of them are available
4. No gaps (such as insufficient testing for a software-related project)
5. SUCCESS CRITERIA
The projects should NOT be over-pledged, which is the critical flaw in Kickstarter's business model (and the other such websites I've studied). They allow over-pledging because they take a flat percentage and more money in the project is more money for them. Instead, when the project is funded, that's it. They earn their percentage for "meta-expertise" in preparing project proposals and evaluating project results.
After the project has been completed, the brokerage applies the success criteria and reports the results to all of the donors and to any websites that were linked to supporting the project proposal.
My new motto is "More detailed suggestions available upon polite request, but I'm not holding my breath." After all, everything is intuitively obvious to the most casual observer.
Freedom = (Meaningful - Coerced) Choice != (Speech | Beer^2), and sad sock puppets' bad mods avail them naught.
Holly shit they even look like total douche-bags.
alex the embezzler
When you invest in something, you take a risk of whether you'll get it.
I bought an Ergodox EZ and luckily it turned out well -- very well. But it was a risk.
Tell me more about these statues. Bronze? Marble? Maybe you can launch a Kickstarter promising to provide taller statues of limitation to people like Peachy Printer whose statues are too short.
I'm guessing YANAL.
"He worked in Northern Alberta as a heavy duty mechanic"
When I read this, I nearly stopped reading further, but curiosity conquered me.
Sorry, but the qualifications floor me.
"David hired an Accounting and Financial Consulting firm to assist in the management of Peachy Printer's finances."
Yup, surely THEY did a great job. Recourse here? I'm betting they did nothing but dip their beaks.
"Due to the fact that the Kickstarter campaign was over before Peachy Printer existed as a corporation, we did not have a corporate bank account set up to receive the funds. As a result, David’s personal account was set up to receive the funds."
Oh, here is where it went bad. I would have left it at Kickstarter until the corporate account was ready.
From here on, it's faith in others, failed human beings, and predictable outcomes.
deleting the extra space after periods so i can stay relevant, yeah.
I think they need a rule that first-time project owners are only allowed to collect up to 200% of their "goal" amount. Once the project hits that number, the "PLEDGE NOW" button goes away.
That limits the amount of damage that a first-time project owner can do. It doesn't prevent them getting the money they need to get the business started - plus a healthy "win" for doing a great job. But it would prevent viral projects from dumping so much money into someone's lap that they become intimidated by the magnitude of the task and find it easier to take the money and run than to complete the project.
Once someone has proved themselves and delivered as promised, they can try again without the cap.
Having run 5 successful Kickstarters myself, most of them 400% or more over goal - I understand how daunting it can be. When the project is running, a kind of "red mist" descends and pushing the total higher and higher becomes highly compelling. When the countdown expires and you suddenly realize that you're tens of thousands of dollars better off - it's exhilarating. But the next morning, when you start to realize the magnitude of what you've just signed up to do...it can be very daunting.
It's also very difficult to plan a project when you don't know whether you'll sell 100 widgets or 100,000 widgets. When you go from "Oh - I can just 3D print that component at home - and solder that switch to the circuit board myself!" to "I've got to get a $10,000 mold made by a company in China and I have to fly out there to make sure it's OK - then find a factory that can solder that switch on for me."...suddenly things get much more serious.
It's exceedingly difficult to design, price and schedule production on a product where you have literally ZERO idea how many you'll sell.
So for that first project - make it so I'll know that I'm selling between 100 and 200 widgets.
www.sjbaker.org
A "screwup" is when you try hard, but something doesn't work and you can't deliver. What we see here is a deliberate embezzlement, which should be a crime, and for which the perp should compensate the backers (by e.g. being forced to sell the house he built with this money).
but even I know that you don't mix personal and business funds. The CEO is a dope for ever allowing it to happen.
-no text-
... only 50% of the revenue was stolen, and his biggest problems are still:
- late delivery
- slow development
- unable to certify/ship the laser
So, yeah, the other incompetent 'financial guy', seems like an easy to blame scapegoat to me.
Lot's of blabla, but I've been waiting all these years on false promises during all the updates...
Shit yeah. I'd download a car too. Hell, I'd download ALL of them.
I never understood that bit about how I wouldn't download a car. Yeah I would. I spend more on automobiles than I spend on almost anything else. If I could download even the parts for a car, I'd do that.
"So long and thanks for all the fish."
...a new kickstarter to put in the pool and sport court?
"How to build a home with a 3D printer."
I don't understand why KS campaigns shouldn't be over-pledged. The ones I've participated in have been basically advance sales, with the money gathered used to design and produce the whatever, and I don't see why more backers can't be accommodated. Some of them also have "stretch goals", so that if they can get $X over the funding amount they can provide better art, or other one-time expenses.
As you describe the brokerage, its main function would be to report on whether the KS campaign worked or not. That's usually pretty obvious for the backers - it's $DATE; am I holding an $ITEM in my hands? There's still the gap between the collection of the money and the planned completion of the project in which anything, including embezzlement, can happen. It's not clear to me that the brokerage adds value, and it will cost money.
"When you have eliminated the unacceptable, whatever is left, however improbable, must be the truthiness" - Holmes
Let me try to reword it as Adam Smith's contemporary David Ricardo might put it. Ricardo basically proved mathematically that specialization is a good thing. If you're an expert at making widgets while I'm an expert at making woojits, we're both better off if each of us stays focused on our specialties and exchange our surpluses. We both wind up with more widgets and woojits than if we wasted some of our time working as amateurs.
As it applies in the specific example here, there is a specialty of making a printer, and there is a separate specialty of preparing a good project proposal. I'm suggesting that the proposal preparation specialty be treated separately, and in this case that would have included checking the required resources, in particular whether or not this person actually had the special capabilities of making the printer. (I think the specialty of evaluating results is also important, but in the example of this article, there were no printer-related results ot evaluate.)
As it too often works on Kickstarter, the only specialty that really counts is the ability to write an interesting proposal. Innovative and weird proposals often "succeed" merely base on their novelty value, but the success is just a chunk of money and Kickstarter is happy to take a cut.
Freedom = (Meaningful - Coerced) Choice != (Speech | Beer^2), and sad sock puppets' bad mods avail them naught.
I don't see anything here about how much funding a Kickstarter should get.
In this case, a supervisory agency would have checked and found that the resources were OK, the design was OK, and likely the preparations for production were OK. What they would not have found was that somebody was going to embezzle the money, and that's a danger in any endeavor that handles enough money. It could have looked at the business arrangements, found them wanting, and asked them to set up something better (where it would take extra effort to embezzle).
If there's demand for such an agency, somebody can make it. and Kickstarter projects can bring it in or not as they choose, and potential backers can pay attention to it or not as they choose. As you point out, it isn't in Kickstarter's financial interest to restrict projects, but if they see it as adding credibility they might well cooperate.
"When you have eliminated the unacceptable, whatever is left, however improbable, must be the truthiness" - Holmes
https://slashdot.org/story/01/...
Yeah, like Slashdot never removed comments before.
APK likes to ask for responses to the same things over and over. Maybe he just likes the responses?
See, that proves my point: deleting a comment was so exceptional that it was newsworthy!
"[Regarding the 'cloud,'] ownership was what made America different than Russia." -- Woz
Actually, there are three ways that the 'charity share brokerage' I am suggesting would be more resistant to this kind of fraud.
(1) They would accumulate experience from evaluating past projects, so they would be able to learn for warning signs that something is suspicious based on comparing the patterns of projects that had had similar problems. As it stands now, Kickstarter simply disclaims any interest in results.
(2) The brokerage would have a vested interest in actively pursuing such criminals (and would also acquire experience in ways to do so). They can't guarantee that any particular project will succeed, but they need to show that they care about success. One possible approach might be to set up a subcontractor relationship with the primary contributors working on the project. Near as I can tell, all Kickstarter does is take their cut, send the money, and say bye bye.
(3) In the course of evaluating the budget and resources, the brokerage would get a better understanding of the economics underlying the entire proposal to make sure that it makes sense to deliver the goods. Not possible in every case because it depends on the kind of project, but still way better than Kickstarter's naive broadcast approach.
I think I need to reiterate that I don't think the Kickstarter people (either website operators or donors) are acting on bad intentions. However, their economic model has flaws and they are responding to those flaws in the natural ways...
Freedom = (Meaningful - Coerced) Choice != (Speech | Beer^2), and sad sock puppets' bad mods avail them naught.
Why would anyone want a printer named "peachy" anyway?