No!

To quote Marcel Marceau

Year of the tech grifter: will Silicon Valley ever learn from its mistakes?

This is another episode of simple answers to simple questions. (Also, Betteridge's Law)

Simply put, the people who fund such enterprises have no interest whatsoever in policing fraud, because in most cases, they get out before the whole corrupt enterprise collapses.

It only becomes news when the rich people selling the fraud do not get out in time.

Here is how it works:  A some garbage venture capital company, I don't wanna name an actual VC firm so let's just make one up; let's call it, "SoftBank,"

They go through 7 funding rounds of funding for a company that has no real prospect of making a huge profit, but has buzz (WeWork, Uber, etc.):

1. They buy 10% of a company for $2,000,000. (Total valuation, $20 million)
2. They buy 5% of a company for $2,000,000. (Total valuation, $40 million)
3. They buy 2% of a company for $2,000,000. (Total valuation, $100 million)
4. They buy 1% of a company for $2,000,000. (Total valuation, $200 million)
5. They buy ½% of a company for $2,000,000. (Total valuation, $400 million)
6. They buy ¼% of a company for $2,000,000. (Total valuation, $800 million)
7. They buy ⅛% of a company for $2,000,000. (Total valuation, $1.6 BILLION)

So they now own 18⅞% of a company valued at $1.6 billion, a unicorn.  Their stake is $302 million, and their total investment was $14 million, so their profit is 15,100.000% when the company goes public and they sell their shares. (Actually less than that after fees and other expenses, but still not chump change)

Of course, 6 months later, the company has a market capitalization of less than ⅓ of that, and eventually has to either shut down or sell itself to some other company for 20¢ on the dollar, but the VC's don't care, they are already out.

Fraud like this is an integral part of the whole Silicon Valley ecosystem, and if we were enforcing securities laws like we did in the 1960s, we would be treated to a parade of VCs being frog marched out of their offices in handcuffs.

Their business model is literally a genteel Ponzi scheme.