BE ch 5 accounts

[Neal Fultz]

For more info on Benford's Law, (Pynchon's explanation is actually
pretty good imho), I'd recommend this article on it in CHANCE magazine
if you want a bit more detail / visualizations:

https://chance.amstat.org/2021/04/benfords-law/

Some highlights:

* Actually discovered earlier by Newcomb  (Stigler's law lol)
* Rediscovered by Benford in interwar period
* Benford himself may have fudged his data a bit (!!!)
* Admissible in the court of the law

* "Not all data sets follow Benford’s law. For example, phone numbers
in a given area would not follow it because the area code is the same
number. Another example would be the recorded times for the Olympic
1,500 m foot race, because none of these times would start with a 1."

* Benfords Law fits COVID case counts very well, but not death counts (!!!)

-

Re "Hash totals", I've always heard them called "checksums" when used
in that application and occasionally "digital signature", but "hash
total" also makes sense.






On Sat, Nov 20, 2021 at 9:15 PM Joseph Tracy <brook7 at sover.net> wrote:
>
> So Maxi starts looking at hsz accounts and finds problems right away.
> 1st the Benford’s Law problem where 1st digits  are  not logarithmic.
> The 2nd problem, Consecutive invoice numbers, I don’t understand???
> 3rd problem may give us a prime insight into the name hashslingerz :Hash totals that don’t add up. Here is a simple version  explanation from Barron’s that I kind of understand:
>    The purpose is to identify whether a record has been lost or omitted from processing. For example, check numbers may be summed to get a hash total. If the total of the check numbers processed does not agree with the hash total, a discrepancy exists, and investigation is required to uncover the error.
>     From something else I read it sounds like hashing makes it hard either to forward engineer or reverse engineer  hash numbers if you wanted to fake accounts.
> 4th problem,  Credit cards failing Luhn checks( Used to id incorrect numbers usually used to protect against accidental errors,).
> That’s a lot of problems for  trying to hide some serious money games.
>
> What Michael B said becomes relevant here about a captive  SEC since we are dealing with large $ numbers and an unproven  fast growing firm(hsz). Even with government laxity most large banks regularly get caught in illegal schemes (though the fines are too low to change the behavior). On the other hand, the military accounting system never gets punished despite losing billions which may be relevant in BE since hsz has military contracts as do several  real world big tech firms.
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> This chapter  is where the genius of  P having his latest detective be a financial fraud investigtor becomes obvious. Follow the money being  the primary tool of investigative reporters, and legal investigators.  She likes also to check things out up close, on site, and in person. This gives us a diverse picture of the world and the players Pynchon is choosing to focus on.
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