SEC probes whether OpenAI investors were misled during leadership tumult - WSJ
Make us a preferred source
Make us a preferred source on Google
The news: The US Securities and Exchange Commission is investigating whether investors in the generative-AI giant, OpenAI, were misled during the company’s tumultuous leadership shakeup last late year.
The numbers: OpenAI was most recently valued at over USD80 billion ($122.9 billion) during an employee liquidation deal in February. The AI juggernaut has received around USD13 billion in funding from Microsoft.
The context: According to unnamed sources cited by the Wall Street Journal, the SEC is examining internal communications of CEO Sam Altman as part of the investigation and have asked that certain senior OpenAI officials preserve internal documents.
In November last year, the OpenAI board decided to fire Altman as CEO and remove him from the board. Directors at the time alleged that Altman had not been “consistently candid in his communications.” After significant backlash, and some back and forth employment offers from Microsoft, Altman was reinstated as CEO and the board was reconstructed without Altman as a member.
Many speculated that the abrupt timing of Altman’s firing set up expectations that a clear problem or ‘smoking gun’ would emerge, but none have appeared as yet. Bloomberg reports that it was Altman’s pattern of behaviour rather than a single action that led to the board losing trust in him.
It is not uncommon for the SEC to close investigations without making formal accusations of misconduct.
The sources: Wall Street Journal, Bloomberg
