but areas i am familiar with can consider a negative reference to be defamation, thus anyone providing a negative reference should only do so if they are able to defend it (i.e. prove their statement is substantially true, or prove that the statement was honestly believed to be true and published with no malice or reckless disregard).
seems risky, at least, to build a whole business around negative references that could potentially cross the line into defamation. but that type of thinking is probably why i am not rich.
There are many definitions of illegal (criminal, civil, regulatory, the much much looser “license to operate” as used in chemical industry, etc).
A blacklist seems dubious. I’d advise the founders to get counsel on their obligations under the FCRA, which they may be construed to be regulated by.
That said, I believe "Bad News" is an AI hallucination. The most similar company I can find historical news is "Peeple"[0], which was not funded by YC. YCombinator's only known association with a blacklist that I can find was a blacklist of VC's that were accused of harassing female founders[1].
>There are many definitions of illegal (criminal, civil, regulatory, the much much looser “license to operate” as used in chemical industry, etc).
yes, but i am not sure why this matters here. i am not aware of negative references, in general, being illegal under any of those definitions of illegal.
no one would say regular speech is illegal just because it can be subject to a defamation lawsuit. same logic.
but i agree, if it is a real business, it seems exceptionally risky.
It's more than just "subject to a defamation lawsuit" (including class action lawsuits). Although for me, even if it were "just that", I'd still call it "potentially illegal". Rather, they'd potentially face FTC penalties and CFPB enforcement actions under 15 U.S.C. section 1681d(a), (b).
This law would likely classify such a company as falling under laws pertaining to "investigative consumer reports" under FCRA. This is any report on someone's "character, general reputation, personal characteristics, and mode of living" used for the purposes of employment, loans, housing, etc.
> A consumer reporting agency shall not prepare or furnish an investigative consumer report on a consumer that contains information that is adverse to the interest of the consumer and that is obtained through a personal interview with a neighbor, friend, or associate of the consumer or with another person with whom the consumer is acquainted or who has knowledge of such item of information, unless—
> (A) the agency has followed reasonable procedures to obtain confirmation of the information, from an additional source that has independent and direct knowledge of the information; or
> (B) the person interviewed is the best possible source of the information.
They'd find themselves subject to legal penalties under:
FCRA Willful Noncompliance (15 U.S. Code § 1681n) (if they did not disclose their existence/use/content of reports to employment candidates)
FCRA Negligent Noncompliance (15 U.S. Code § 1681o) (if they made somewhat reasonable but insufficient efforts to comply with the FCRA)
or
Administrative Enforcement (15 U.S. Code § 1681s)
and be subject to fines up to $4,700 per violation plus actual damages, plus punitive damages, plus legal fees. State Attorneys General can also bring FCRA lawsuits on behalf of their constituents, not just the federal government. FTC / CFPB can name the founders individually in the lawsuits, not just their corporate entity, and ban[1][2] them from operating any similar businesses in the future.
That all said, to some extent, YCombinator partners are on the record[3] supporting the idea of their startups sometimes doing illegal things. Generally they'll frame this as challenging outdated regulations, but they acknowledge that the founders whose strategies they fully support sometimes come into office hours and discuss how they're worried that the strategy puts them at risk of going to jail.
ah, okay. so the hypothetical company may potentially be doing something illegal (the "investigative consumer report" part). good to know! that makes sense, and i was unaware of that.
i stand corrected in the hypothetical "bad reference aggregator company" scenario.
>YCombinator partners are on the record[3] supporting the idea of their startups sometimes doing illegal things.
interesting, thanks for surfacing that up! i wont pretend to be surprised, though.
i dont believe that it is illegal to provide a negative reference in the UK, as long as it is honest, factual, and provided in good faith.
from gov.uk:
>"If you think you’ve been given an unfair or misleading reference, you may be able to claim damages in court. Your previous employer must be able to back up the reference, such as by supplying examples of warning letters.
You must be able to show that:
- it’s misleading or inaccurate
-you ‘suffered a loss’ – for example, the withdrawal of a job offer"
which means, if the reference is not misleading and not inaccurate, a negative reference is ok. other uk-based law firms (from a quick google) agree with this interpretation.
Providing a negative reference is totally different than gathering negative references and selling them. The former could be legal while the latter could be illegal.
in my comment, i was speaking more generally than i should have, and that (obviously, in hindsight) caused some confusion between the specific case of the hypothetical company, and the general case of an employer providing a negative reference. my bad -- and it is too late to edit to provide clarification.
No problem, I wasn't very clear either! I remember someone I know looking into this in the early 2000s as part of a wider collective thing. It's long enough ago that I can't remember the details but it was definitely less about a poor reference and more about the individuals' being on a list somewhere without having even applied for a job. And come to think of it, it's probably even more illegal now because of GDPR.
Due to the wonders of technology, you can now do the equivalent of the Steven Wright joke:
“In my house there's this light switch that doesn't do anything. Every so often I would flick it on and off just to check. Yesterday, I got a call from a woman in Germany. She said, 'Cut it out.'”
I once did something similar for car wash doors. there's a car wash door company out there that has a control panel accessible over VNC and uses the same defaults for every one they set up, so I used to connect to random ones and open and shut the car wash doors for the fun of it. The best part was when someone noticed and tried to shut it only for me to open it again, resulting in a battle where neither of us knew anything more than someone or something keeps undoing my actions
Was the statement that over 50% of the money from USAID never left the country, ever shown to be false?
It’s clear that just like the California-spent billions on the homeless, a large amount of the money was going to support the nephews and cousins etc of the connected in cushy jobs.
> 50% of the money from USAID never left the country, ever shown to be false?
Yes, in as much as that is a nonsense phrase meant to sound bad. If USAID buys wheat from American farmers, the money stays in the US and the wheat is exported.
add the recent public meeting with CA Gov's office in San Francisco, delivering 9 figures of new money to the homeless situation in CA.. with Democrat figures emphatically and pointedly declaring all the money legitimate and accountable.. at the very same moment that news headlines are showing court documents of the opposite at a large scale in multiple jurisdictions .. mostly Los Angeles to be clear
#--
Governor Gavin Newsom met with San Francisco Mayor Daniel Lurie on January 16, 2026, to announce over $419 million in new state funding for homelessness and mental health efforts in San Francisco, Los Angeles, and San Diego. The funding comes from the sixth round of the Homeless Housing, Assistance and Prevention (HHAP) program and includes $39.9 million for San Francisco to support shelter operations, navigation centers, and services through June 2029.
In the past I had the impression that some thought that Rust was the first programming language to ever have the concept.
reply