8 comments

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  Laverne

  11 months ago

  You need to educate yourself further both on Mr. Lin's activities, his parents' (Jui-Teng Lin and Yuchin - a.k.a. Suchin - Lin's criminal activities regarding stock fraud, and the regulations involving these kinds of offerings that were instituted in the New Deal to protect legitimate investors from just this kind of thing.
  
  What he’s done is in violation of SEC rules. You can’t offer shares in a nonesxistent corporation to the general public without first going through the admittedly cumbersome process of filing the proper documents and making sure that you make the offer on paper ONLY to “qualified investors.”
  
  As you will see from going on the Freakonomics blog or Mr. Lin’s own post’s comments, this is a young man whose parents have been called by the SEC “securities fraud recividists” and who fled the country facing an SEC judgment that they disgorge the $1.7 million from the investors they stole from by using lies, money laundering, and outright fraud. Mr. Lin’s father served time in federal prison after being found guilty of fraud by a Brooklyn federal jury in December 2002.
  
  It would behoove you to do some research before touting a scheme that is risky to investors, possibly totally fraudulent and certainly in violation of current federal securities investigations. It would be dangerous for any other writers to emulate him in this.
  
  Mr. Lin, as you will see if you check on him, is an admitted shoplifter and vandal who has a long history of having a reputation as a bad actor in the publishing world.
  
  I am sorry to see that you have apparently fallen for this scam artist’s self-serving scheme.
  
  A complaint has been filed with the SEC regarding this matter, including in it Melville House, Mr. Lin’s publisher, who has a contract for the novel in question. He, in fact, has gone behind their back to sell shares in his royalties paid for by them. Thus he has subjected them (with the firm’s assumed deeper pockets - if Mr. Lin is this desperate for money, he is obviously judgment-proof) to liability in this matter.
  
  There might be ways to do this, but Mr. Lin, like his parents, apparently believes rules do not apply to him. Anyone who invests in this is letting themselves in for a complete loss of their funds, and Mr. Lin, as he notes, has absolutely no downside risk at all. Trust him, he says - just what his parents told the investors in their firms whom they bilked of nearly two million dollars.
  
  At the very least, you should rent the film "The Producers"!
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  Taylor

  11 months ago

  To be fair, this isn't really about one individual. I know nothing about this background, and he could well be a fraudster with shady parents. But as an idea it's worth exploring (the point of the post), no? I certainly don't think Jarred is advocating that folks drop everything and invest in this questionable scheme, but it's an interesting story that makes us consider alternative funding models in publishing. As such, it's worth talking about and altogether irrelevant to focus on this one guy, his parents, and their legal record.
  
  Sounds like you have an axe to grind with Tao Lin. That's your prerogative, but why not focus instead on the very interesting question of whether a scheme like this--done in a legitimate way--could be possible or preferable to the current publishing system? I look forward to that (far more interesting) discussion.
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  Jarred

  11 months ago

  Laverne, fair enough. The reason I didn't look beyond Freakonomics or Lin's own blog is because I'm not really concerned with his particular venture. Certainly, any one considering Lin's proposal should do their background research into him and the current rules and laws surrounding this concept. It sounds like there are some issues, and I encourage anyone brave enough to even be toying with the idea of sending $2,000 to Tao Lin by PayPal to do their due diligence.
  
  I want to draw attention to one paragraph you wrote:
  
  

  It would behoove you to do some research before touting a scheme that is risky to investors, possibly totally fraudulent and certainly in violation of current federal securities investigations. It would be dangerous for any other writers to emulate him in this.

  
  
  What investment isn't risky for investors? Certainly if it breaks current rules and is "fraudulent," then this approach should be neither recommended nor executed. But isn't it worth, as Taylor noted, exploring this idea to see if it could (theoretically) work? That was the real point of the post.
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  Laverne

  11 months ago

  All investments carry some risk, of course. But then there are risks taken on both sides in most investments. What is Tao Lin's risk in all of this? What are his liabilities should the novel fail to sell as many copies as he projects? What remedies are available to the investors. Presumably, if he can be believed, Tao Lin already has $10,000 of people's money. Are there contracts? What if there is no novel in progress? What if there is, but he abandons it? What happens if something, God forbid (I am not being nasty here but if you are investing to a person, we are all vulnerable to accidents, illness, premature death), happens to Tao Lin that makes him unable to write the novel?
  
  There are some investments that are less risky, of course. If you invest in a certificate of deposit at a bank, your returns are lower but your money is guaranteed by the FDIC. If you invest in stocks, you have more of a risk but more of an upside (as well as downside), but at least you are protected by SEC rules, state rules (see how NY State Atty. Gen. Andrew Cuomo, and before him, Eliot Spitzer, has used state power to do for cheated investors what the federal government could not), and SIPC.
  
  Tao Lin sounds as if he's doing this on the fly, without any legal documents: the kind of offerings you need to register with the SEC or state authorities; without contracts; and most importantly, without any legal obligation to do anything.
  
  If he were sincere about creating an innovative scheme, he would have consulted a lawyer. Presuming he has a contract with Melville House for the book, then he may be violating it by committing a portion to as-yet ephemeral royalties paid by Melville House to Tao Lin. He is also cruelly and thoughtlessly laying his publisher open to liability if the investors decide to sue. Because Tao Lin may have no assets, they can sue Melville House, who as the publisher, is clearly involved in the product.
  
  What if the book fails to sell not because of its literary merit or great reviews but because Melville House screws up and doesn't print enough copies or doesn't promote the book successfully or, as often happens, goes bankrupt, gets taken over by another entity which has no interest in promoting or printing more copies of Lin's book, etc.?
  
  The point of this longwinded reply is, he thinks he is still dealing with the kids (under 25) who are his blog and book readers and not adult rules and governmental regulations that are in force when you take thousands of dollars from "investors" in a "corporation," which he calls it. (You just don't call things "corporations" without doing a lot of paperwork.)
  
  Finally - whew, I'm sorry - don't you think that if this had been a valuable idea that some artists' and writers' groups, business people, publishers, etc., would have thought of it and used it before it was thought up by a penniless 25yo hipster who apparently has worked only minimum-wage menial part-time jobs? (He said his last job was in a vegan cafe).
  
  Tao Lin is just in this for the same reason he does everything else: to selfishly promote himself. But this scheme is just one more thing he's done to give himself a very, very bad reputation among serious writers and publishing people.
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  Jarred

  11 months ago

  Again, mostly valid points here Laverne. Since I've made clear before that I agree with you on most of the factual criticisms of Lin's endeavor, I won't respond to most of your comment. What I will respond to is where you touch on what I really care about in this whole idea: the possibility of doing this in a legitimate, safe way.
  
  You say:
  
  

  Finally - whew, I'm sorry - don't you think that if this had been a valuable idea that some artists' and writers' groups, business people, publishers, etc., would have thought of it and used it before it was thought up by a penniless 25yo hipster who apparently has worked only minimum-wage menial part-time jobs? (He said his last job was in a vegan cafe).

  
  
  Subtracting your needless pot shots at Lin from that paragraph, it appears you're asking whether or not a young person with a fresh perspective on the world could possibly have dreamed up a viable business strategy that conventional organizations and business leaders (here, we're call them "old people") haven't.
  
  And my answer is, to borrow a contemporary buzz phrase, "yes we can." Sometimes it takes an outsider -- and maybe even a selfish, self-promoting, ambitious, and possibly crooked rogue artist -- to shake up the establishment. If your only response to my and Taylor's question ("if the rules allowed it and investors were protected, could this work?") is to say "that's not allowed" and "Lin is a selfish hipster," then I suggest you take your whining elsewhere. We're interested in thoughtful debate about the issue, not sniping at ideas based exclusively on personal vendettas.
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  Peter

  11 months ago

  The funny thing about Laverne is that he/she/it is a troll who goes around trash talking Tao Lin as part of a bizarre fetish borne out of jealousy seated in the fact that "Laverne"'s writing is so boring and uninspired. I wonder how Laverne knows that Tao has a bad reputation among serious writers and publishing people, being none of those him/her/itself?
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  Paul

  11 months ago

  Oh snap!
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  William Keckler

  11 months ago

  I tried to post this to Tao Lin's website, but I may as well post it here for "Laverne"...where's "Shirley?" Off fighting the FCC fights?
  
  Well, I'm sure somebody pointed this out to Tao Lin if he didn't realize it himself, but "Laverne" has opened himself, herself or itself up to legal action by libeling Mr. Lin the younger.
  
  The long list of testimonials being posted to his blog (with nary a counterexample) as to his trustworthiness belie "Laverne's" claims to the contrary...which she has in her foolhardy manner put in writing.
  
  Of course that is actionable.
  
  So Mr. Lin might make some additional money off "Laverne's" obsessive persecution, or at least increase the STFU edge against this annoying Fatal Attraction-level pathetic "person."
  
  (God, I hope this isn't another Tao Lin self-created, self-staged drama...i.e. god I hope Tao Lin ISN'T Laverne...spare us the postmodern concept of an entity. I have supped full with J.T. Leroys and Armistead Maupins!)
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