SEC Probes OpenAI Over Potential Misleading Investor Communications

Written by Henrik Rothen

Feb.29 - 2024 12:12 PM CET

Photo: jamesonwu1972 /
Photo: jamesonwu1972 /
SEC Probes OpenAI Over Potential Misleading Investor Communications.

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The Securities and Exchange Commission (SEC) has initiated an investigation into whether investors were potentially misled by internal communications from OpenAI, with a specific focus on CEO Sam Altman's correspondences. This inquiry puts a spotlight on the governance and disclosure practices at the helm of the company behind ChatGPT.

Investigation Triggered by Leadership Controversy

The investigation was prompted by events in November when Altman was temporarily removed from his leadership role at the San Francisco-based AI firm. The board's public lack of confidence in Altman's transparency was cited as a key reason for his initial dismissal. However, his swift reinstatement followed a threat of mass resignation by the company's 750 employees, showcasing the internal turmoil and its potential impact on investor perception.

Sam Altman's Role and SEC Inquiry

Altman, who returned to his position as CEO after a brief hiatus, is at the center of the SEC's examination. The inquiry delves into emails and internal records to discern if there was any misleading information provided to investors. Notably, the SEC's probe, as reported by the Wall Street Journal, has not yet identified any specific misleading statements from Altman.

Global Impact and Regulatory Attention

Amidst this backdrop, OpenAI has seen its valuation soar to $80 billion, driven by the global success of ChatGPT since its launch in November 2022. Despite its commercial success, OpenAI faces scrutiny not just from the SEC but also from other regulatory bodies both in the United States and abroad.

  • The US Federal Trade Commission is investigating the competitive impacts of AI investments by OpenAI and other tech giants like Amazon and Google's Alphabet.

  • The UK's Competition and Markets Authority is examining OpenAI's partnership with Microsoft, highlighting international concerns over market competition and AI governance. This is reported by The Guardian.