SEC investigating whether Sam Altman misled OpenAI investors, report says

Inquiry comes months after ChatGPT maker's board ousted their chief executive for being 'not consistently candid in his communications'

A US regulator is reportedly investigating whther OpenAI chief executive Sam Altman misled investors. Reuters

The US Securities and Exchange Commission is investigating internal communications by Sam Altman as part of an inquiry into whether OpenAI's investors were misled, The Wall Street Journal reported.

The investigation came after OpenAI's board fired Mr Altman as the company's chief executive in November after directors said he was “not consistently candid in his communications”. Mr Altman rejoined the company as chief executive weeks later as part of a deal to restructure OpenAI's board.

The US regulator has been seeking internal records from current and previous directors and officials at the ChatGPT maker and subpoenaed the company in December, WSJ reported on Wednesday night.

OpenAI is governed by a non-profit organisation that comprises former US Treasury secretary Larry summers, former Twitter director Bret Taylor and Quora co-founder Adam D'Angelo.

The company's for-profit arm includes employees, venture capitalists and its partner Microsoft, which has invested about $13 billion in the company.

As part of the restructuring in November, OpenAI's board said its partner Microsoft would have an oversight role.

Citing sources, WSJ reported that no specific comment or communication by Mr Altman has been deemed misleading. Rather, it is believed it was an expected response to OpenAI's allegations in its November statement.

The SEC enforces laws that make it illegal for companies to mislead investors, although its investigation into OpenAI may find no evidence of wrongdoing.

The new inquiry into OpenAI comes as the company faces other investigations by numerous regulators.

The US Federal Trade Commission in December began preliminary inquiries into OpenAI's partnership with Microsoft's investment into the company. UK and European Commission regulators are also looking into the partnership.

The National has contacted OpenAI for comment.