Seems like a rather large moral hazard if we don't?

At some point the courts should be able to say "ok fine you were the directors responsible for the company you're going to prison n years, sorry."

Bet we'd see a lot more documentation suddenly appear.

But think of the innovation we'd lose out on by jailing executives doing this. A bank that gives sub-market interest and "invests" part of the difference in a scratcher game that they run. Oh, and for complex legal reasons, they're not a bank, but they do offer bank accounts at a different bank.

I'd bet 95% of fintech startups are just walking moral hazards to begin with.

> Seems like a rather large moral hazard if we don't

Based on what? The catastrophic failure rate is low. And if you’re sensitive to that risk, don’t bank with a firm that’s selling you on sticking it to the man or whatever.