SEC Probes OpenAI for Possible Investor Misleads, Reports WSJ

The U.S. Securities and Exchange Commission (SEC) is currently investigating whether investors in OpenAI were misled during a period of intense leadership debate last year. According to the Wall Street Journal, the SEC is examining internal communications involving Sam Altman, the former CEO of OpenAI, who was removed from his position in November. The SEC issued a summons to OpenAI in December, requesting that senior officials preserve internal documents.

To address the current situation based on an inquiry from the SEC, Altman agreed to an internal investigation. However, tensions within OpenAI have surfaced, including Altman’s fundraising efforts for an external chip venture, which involved seeking funding in the Middle East. Additionally, Altman clashed with former board member Helen Toner over a research paper critical of the company. 

OpenAI’s ChatGPT triggered the current rush to adopt artificial intelligence across all manner of industries and services, with Microsoft Corp. investing more than $10 billion into its partnership with the closely held startup. Further Reading: Microsoft-backed OpenAI Hits $2 Billion Revenue Mark; Eyes on Doubling by 2025

OpenAI’s ChatGPT, which gained widespread popularity after its launch in November 2022, has led to the company being valued at $80 billion. However, OpenAI faces multiple investigations by regulators and government bodies. Also Read: OpenAI ChatGPT has above 180 million users and $80 million monthly revenue. 

The SEC, as part of its inquiry, has not yet pointed to any specific misleading statement or communication by Altman. The SEC’s probe may not lead to any finding of wrongdoing by the parties involved. OpenAI selected two lawyers from the firm WilmerHale to conduct its investigation into the events. 

Also Read: Who is Sam Altman the ChatGPT Founder? Find Out All Latest Details Here

“While the review is ongoing, the board will continue to take steps to strengthen OpenAI’s corporate governance, build a qualified and diverse board of exceptional individuals, and oversee OpenAI’s important mission of ensuring that artificial general intelligence benefits all of humanity,” Bret Taylor, chair of OpenAI’s board, said in December.