The practice of proclaiming virtue while amassing wealth and power is not new - Insurance News | InsuranceNewsNet

InsuranceNewsNet — Your Industry. One Source.™

Sign in
  • Subscribe
  • About
  • Advertise
  • Contact
Home Now reading Newswires
Topics
    • Advisor News
    • Annuity Index
    • Annuity News
    • Companies
    • Earnings
    • Fiduciary
    • From the Field: Expert Insights
    • Health/Employee Benefits
    • Insurance & Financial Fraud
    • INN Magazine
    • Insiders Only
    • Life Insurance News
    • Newswires
    • Property and Casualty
    • Regulation News
    • Sponsored Articles
    • Washington Wire
    • Videos
    • ———
    • About
    • Meet our Editorial Staff
    • Advertise
    • Contact
    • Newsletters
  • Exclusives
  • NewsWires
  • Magazine
  • Newsletters
Sign in or register to be an INNsider.
  • AdvisorNews
  • Annuity News
  • Companies
  • Earnings
  • Fiduciary
  • Health/Employee Benefits
  • Insurance & Financial Fraud
  • INN Exclusives
  • INN Magazine
  • Insurtech
  • Life Insurance News
  • Newswires
  • Property and Casualty
  • Regulation News
  • Sponsored Articles
  • Video
  • Washington Wire
  • Life Insurance
  • Annuities
  • Advisor
  • Health/Benefits
  • Property & Casualty
  • Insurtech
  • About
  • Advertise
  • Contact
  • Editorial Staff

Get Social

  • Facebook
  • X
  • LinkedIn
Advisor News
Newswires RSS Get our newsletter
Order Prints
November 28, 2022 Newswires
Share
Share
Post
Email

The practice of proclaiming virtue while amassing wealth and power is not new

Hawaii Tribune-Herald

What do Elizabeth Holmes, Sam Bankman-Fried and Al Capone have in common? No, they are not all convicted felons. Capone did serve time for tax evasion, and Holmes was recently sentenced to 11 years in prison for defrauding the public through her blood-testing company Theranos. But Bankman-Fried, founder of the now-bankrupt cryptocurrency exchange FTX, has not yet been charged with anything, although regulators and investigators are sorting through the financial carnage.

The answer to what they have in common is that each one employed a time-honored strategy to win public approval - the "virtue narrative" - even while they were boldly picking pockets.

During the Great Depression, the Tribune reported that a mysterious benefactor opened up a soup kitchen in the Loop and was doling out three free meals every day to more than 2,000 hungry people. A bit of investigative work revealed that the good Samaritan was none other than crime boss Capone, who could easily afford such generosity, given that the annual income from his criminal empire derived from booze, gambling and vice was north of $100 million a year.

Whatever sympathy Big Al may have had for the hungry, part of the image he cultivated as a public benefactor was to create a virtue narrative. "I have spent the best years of my life giving people the lighter pleasures, helping them have a good time," he said. Feeding the hungry went along with that, and his efforts were not unsuccessful, given that many people regarded him as a hero before he ran afoul of the Internal Revenue Service.

Holmes founded Theranos, the blood-testing company that couldn't learn much from testing blood. But it was an effective vehicle to raise money. Her story was that she wanted to revolutionize health care by eliminating the torture of the blood draw. Who wouldn't want that? All that was necessary was a finger stick that was capable of a detailed blood analysis, which would revolutionize diagnostics. A ubiquitous figure in the media who constantly described her desire to change the world for the better, the Silicon Valley wunderkind crafted a $9 billion company out of virtue.

Holmes quickly became a darling of the media and Wall Street. She recruited an impressive cast to the board of Theranos, including former U.S. Defense Secretary James Mattis, a U.S. senator, a former head of the Centers for Disease Control and Prevention, and two former U.S. secretaries of state, Henry Kissinger and George Shultz. Shultz, in particular, was so enamored of what Holmes was saying that he ignored warnings from his own grandson who worked at Theranos. He told his grandfather that the company's blood-testing machine did not work, and to Schultz's subsequent embarrassment, his grandson was right.

The virtue narrative caused experienced people to exercise egregiously bad judgment. Rupert Murdoch, executive chairman of News Corp. and owner of The Wall Street Journal, was an investor in Theranos: "Of course it was fraud. But I only have myself to blame for not asking a lot more questions. One of a bunch of old men taken in by a seemingly great young woman! Total embarrassment."

In terms of money, Bankman-Fried outperformed Holmes and Capone. He was CEO of the cryptocurrency exchange company FTX and the related company Alameda Research. The value of FTX was in the neighborhood of $32 billion. His virtue narrative was "effective altruism": making huge sums of money and donating it to worthy causes such as efforts to address global warming, pandemic preparedness and animal welfare. He and his partners started a project called the Future Fund, designed to make investments in "socially impactful companies," according to their website. It sounds so wholesome.

Savvy venture capitalists and those who didn't know cryptocurrency from cryptography flocked to invest. Bankman-Fried secured naming rights to the field at the University of California, Berkeley stadium. He sat on stage next to Bill Clinton and Tony Blair touting the future of cryptocurrency. FTX commercials featured, among others, Larry David, Tom Brady, Gisele Bundchen and Steph Curry.

The whole thing appears to have been a giant Ponzi scheme and collapsed earlier this month. Bankman-Fried's wealth, estimated in billions, has largely vanished as FTX filed for bankruptcy reorganization, along with 130 associated entities. Investors are likely to be left out in the cold; those prominent commercial pitchmen are now being sued presumably by those who think they have been bilked.

The practice of proclaiming virtue while amassing wealth and power, often unethically or illegally, is not new. It is reminiscent of the indulgences the Catholic Church sold in the Middle Ages. As a means of expiating their sins, the wealthy would purchase indulgences from the church. This was basically a medieval virtue narrative: The church amassed wealth to finance ornate cathedrals, while individuals were free to continue sinning with the tacit approval of the clergy

When I was a young man, I visited the legendary Chicago writer and cynic Nelson Algren in his Wicker Park home before he decamped to New Jersey. He told me, "When you examine why prominent people and corporations do things, there are two reasons - the reason they give publicly and the real reason."

In this case, the public reason is the virtue narrative, and too many people including investors, politicians and journalists want to believe the virtue narrative at the expense of the real reason.

Dr. Cory Franklin is a retired intensive care physician.

Older

Billionaire's troubled insurance companies liquidated by North Carolina judge

Newer

Ohio's car insurance rates are going up

Advisor News

  • How advisors can help frugal retirees finally enjoy their savings
  • Wealth planning vs. estate planning: Honoring your client’s wishes
  • What to discuss during the first retirement planning meeting
  • Inflation, competing priorities and uncertainty erode retirement security
  • As health premiums rise, 1 in 8 workers cut retirement savings
More Advisor News

Annuity News

  • Jackson Announces New Annuity Offering for AARP Members
  • National Life Group expands annuity portfolio
  • AM Best to Join Life/Annuity Insurance-Focused Panel Discussion at Capitol Forum Event
  • USAA Earns No. 1 Ranking in JD Power Individual Annuity Study for the Third Consecutive Year
  • How flexible annuities fit today’s retirement portfolios
More Annuity News

Health/Employee Benefits News

  • NYC public hospitals brace for coverage crisis as federal Medicaid work requirements loom
  • MDHS announces open enrollment assistance for eligible families through SHIP
  • Findings in Health Policy and Planning Reported from University of Kentucky (The Enrolment Paradox: Qualitative Evidence on Gendered Barriers to National Health Insurance for Ghana’s Poorest Households): Health and Medicine – Health Policy and Planning
  • It's ACA open enrollment time. Here are the changes for health insurance shoppers
  • Gottheimer joins North Jersey families helped with military pension back pay, health insurance coverage, IRS refunds and more
More Health/Employee Benefits News

Life Insurance News

  • Corebridge Financial Announces Third Quarter 2026 Results
  • MassMutual announces record $3.3 billion policyowner dividend for 2027
  • Protective Completes Acquisition of Obsidian, Establishing Specialty Property and Casualty Business Line
  • Jackson Announces New Annuity Offering for AARP Members
  • Open Enrollment Starts November 1: Tampa Broker Ryan Michalek Urges Families and the Self-Employed to Check 2027 Costs Before They Auto-Renew
More Life Insurance News

NEWS INSIDE

  • Companies
  • Earnings
  • Economic News
  • INN Magazine
  • Insurtech News
  • Newswires Feed
  • Regulation News
  • Washington Wire
  • Videos

FEATURED OFFERS

Press Releases

  • Spectrum Weather & Specialty Insurance Celebrates 15 Years and Welcomes the Next Generation
  • Royal Neighbors of America® Increases Service Capacity
  • Benefits Studio Launches to Fill the Missing Middle of Benefits Navigation at $49/mo
  • Lauren Sinnott Named to Ragan’s Top Women in Marketing Awards, Class of 2026 
More Press Releases > Add Your Press Release >

How to Write For InsuranceNewsNet

Find out how you can submit content for publishing on our website.
View Guidelines

Topics

  • Advisor News
  • Annuity Index
  • Annuity News
  • Companies
  • Earnings
  • Fiduciary
  • From the Field: Expert Insights
  • Health/Employee Benefits
  • Insurance & Financial Fraud
  • INN Magazine
  • Insiders Only
  • Life Insurance News
  • Newswires
  • Property and Casualty
  • Regulation News
  • Sponsored Articles
  • Washington Wire
  • Videos
  • ———
  • About
  • Meet our Editorial Staff
  • Advertise
  • Contact
  • Newsletters

Top Sections

  • AdvisorNews
  • Annuity News
  • Health/Employee Benefits News
  • InsuranceNewsNet Magazine
  • Life Insurance News
  • Property and Casualty News
  • Washington Wire

Our Company

  • About
  • Advertise
  • Contact
  • Meet our Editorial Staff
  • Magazine Subscription
  • Write for INN

Sign up for our FREE e-Newsletter!

Get breaking news, exclusive stories, and money- making insights straight into your inbox.

select Newsletter Options
Facebook Linkedin Twitter
© 2026 InsuranceNewsNet.com, Inc. All rights reserved.
  • Terms & Conditions
  • Privacy Policy
  • InsuranceNewsNet Magazine

Sign in with your Insider Pro Account

Not registered? Become an Insider Pro.