It turns out the venture capital industry doesn’t just merely fund junky AI startups — it also systematically breeds the conditions for fraud. The cases totaled around $688 million in financial losses, and resulted in 73 years of cumulative prison sentences. After analyzing the individual cases, the researchers identified a persistent pattern of “façading,” in which startup entrepreneurs hide their flailing businesses from scrutiny through an assorted mix of fraudulent behavior. One example of this might be the company iLearning Engines, a $1.5 billion AI startup which was found to be faking “virtually all its customer relationships and revenues” by a Department of Justice probe earlier this year. More on startups: We Are Mildly Horrified by This AI Startup That Coerced People Into Getting Tattoos of Its Logo in Exchange for a Job InterviewThe post VC-Funded Startups Linked to Persistent Fraud appeared first on Futurism.