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Investing.com — The Securities and Exchange Commission (SEC) is investigating whether OpenAI investors were misled following the AI company's recent management shakeup, The Wall Street Journal reported Thursday, according to a person familiar with the matter. This was reported based on a person involved.
Regulators are specifically looking into internal communications involving CEO Sam Altman, who also sent a sub-open to OpenAI in December, WSJ reported.
The move comes on the heels of Altman's abrupt firing and return in November 2023, which also led to a major overhaul of OpenAI's board of directors.
The review also saw the expulsion of Ilya Satskeva, co-founder of the AI startup.
Major investor Microsoft (NASDAQ:) has not yet formally nominated any candidates for OpenAI's board, although it took up the position of observer, a non-voting seat on the board, in November.
OpenAI did not immediately respond to a request for comment.
OpenAI gained public attention in late 2022 with the release of its ChatGPT software. Its ability to generate compelling text responses gained it millions of users within days. The company has sparked widespread entry into generative artificial intelligence (GenAI) over the past year and is considered a leading voice in the AI space.
OpenAI recently announced a new model, Sora, that can convert text prompts into videos.
But the AI startup's rapid rise in popularity has also come with its own set of controversies. A major management shake-up in November raised questions about the company's governance structure, especially since it was established as a nonprofit in 2015.
The company is also facing numerous lawsuits over the nature of the data used to train GenAI models. Most recently, the New York Times sued OpenAI in December 2023, alleging that the startup illegally used copyrighted material in its publications.
