That was known and the board allowed it. I am on the fence about this because this kind of fraud is team effort. The board and the investors avert their eyes for things that are unethical or even illegal because the "founder" is the golden goose that can do no wrong. They also seem to like being lied to.

"Due diligence" is a dirty phrase in that world. They are geniuses, man. Movers and shakers!