SEC probes OpenAI over possible investor deception

SEC probes OpenAI over possible investor deception

The US Securities and Exchange Commission (SEC) is reportedly investigating whether OpenAI, the artificial intelligence company behind ChatGPT, misled its investors about its operations and prospects, according to the Wall Street Journal (WSJ).

The SEC issued a subpoena to OpenAI in December, seeking emails and internal records from its CEO Sam Altman and other executives and board members, the WSJ reported on Wednesday, citing people familiar with the matter.

The inquiry was triggered by the controversial firing and reinstatement of Altman as the CEO of OpenAI in November, after the board accused him of being dishonest in his communications and lost confidence in his leadership. However, Altman was brought back to the helm after a mass resignation threat from the company’s employees, who supported him. The board was also replaced with a new one.

sam altman

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The WSJ said the SEC had not identified any specific statement or communication by Altman that it believed might be false or misleading. The SEC often conducts investigations without making any allegations of wrongdoing.

OpenAI, which was founded in 2015 as a nonprofit research organization, has become one of the most prominent and valuable players in the AI field, with a valuation of $80bn (£63bn) and backing from Microsoft, its largest investor. Its ChatGPT product, which was launched in November 2022, has gained worldwide popularity for its ability to generate realistic and engaging text and speech.

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However, OpenAI is also facing scrutiny from other regulators and authorities over its activities and partnerships. The US Federal Trade Commission announced in January that it had launched an investigation into OpenAI and other tech giants, such as Amazon and Google, to examine their AI investments and their impact on competition. The UK’s Competition and Markets Authority also said in December that it would look into the relationship between OpenAI and Microsoft.

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