Dear General Bonta:

As a California company that builds Generative AI technology, Meta Platforms, Inc. (“Meta”) is deeply concerned about OpenAI’s attempt to shed the non-profit status under which it was founded in order to establish a for-profit entity. We urge you to review this proposed transaction, including the nature and timing of any transfer of assets from OpenAI’s non-profit entity to other entities. Failing to hold OpenAI accountable for its choice to form as a non-profit could lead to a proliferation of similar start-up ventures that are notionally charitable until they are potentially profitable. The People of California have direct and urgent interests in stopping this behavior. All for-profit activities of OpenAI and its related entities should be paused to protect investors and consumers alike.

In 2015, OpenAI filed its original certificate of incorporation with the State of Delaware, which reads:

This Corporation shall be a nonprofit corporation organized exclusively for charitable and/or educational purposes within the meaning of section 501(c){3) of the Internal Revenue Code of 1986, as amended, or the corresponding provision of any future United States Internal Revenue law. The specific purpose of this corporation is to provide funding for research, development and distribution of technology related to artificial intelligence… The corporation is not organized for the private gain of any person… The property of this corporation is irrevocably dedicated to the[se] purposes… and no part of the net income or assets of this corporation shall ever inure to the benefit of any director, officer or member thereof or to the benefit of any private person.

OpenAI reaffirmed this commitment on its very own website years later:

Seeing no clear path in the public sector, and given the success of other ambitious projects in private industry, [OpenAI] decided to pursue this project through private means bound by strong commitments to the public good. [OpenAI] initially believed a 501(c)(3) would be the most effective vehicle to direct the development of safe and broadly beneficial AGI while remaining unencumbered by profit incentives.

Taking advantage of this non-profit status, OpenAI raised billions of dollars in capital from investors to further its purported mission. The company represented to the State of California and the world that it would be run without any profit motivation. Investors and the public rightfully relied on that assurance. 

Now, OpenAI wants to change its status while retaining all of the benefits that enabled it to reach the point it has today. That is wrong. OpenAI should not be allowed to flout the law by taking and reappropriating assets it built as a charity and using them for potentially enormous private gains. 

Moreover, OpenAI’s proposed conversion represents not simply a future, potential abuse of corporate form. We would also urge you to examine whether OpenAI’s past practices are consistent with its obligations as a non-profit – most notably whether it has inappropriately depleted the assets of the non-profit by distributing assets to third-party entities.  

OpenAI’s conduct could have seismic implications for Silicon Valley. If permitted, OpenAI’s restructuring would represent a paradigm shift for technology startups; allowing this restructuring would only entice investors to launch organizations as non-profits, collect hundreds of millions of dollars in tax-free donations to support research and development, and then assume for-profit status as its technology becomes commercially viable.

Indeed, if OpenAI’s new business model is valid, non-profit investors would get the same for-profit upside as those who invest the conventional way in for-profit companies while also benefiting from tax write-offs bestowed by the government and, ultimately, the public. That would distort the market by essentially requiring any startup seeking to remain competitive to adopt the same playbook. 

We understand that Elon Musk and Shivon Zilis are currently seeking to represent the public interests in Musk v. Altman, No. 4:24-cv-04722-YGR (N.D. Cal.). Although we would also urge your office to take direct action, we believe that Mr. Musk and Ms. Zilis are qualified and well positioned to represent the interests of Californians in this matter. Their early, foundational roles in OpenAI’s creation and operations and as prior members of its Board position them to understand better than anyone what OpenAI was intended to be and how its current conduct deviates from its charitable mission.

Meta is committed to openness and transparency in the transformative field of AI. OpenAI’s charitable promise to develop safe and broadly beneficial AI free from commercial pressures is an important one, and it should be kept. Given the breakneck speed at which OpenAI is continuing its for-profit conversion, this is a special case with an urgent necessity for action.

We appreciate your consideration of our views and are happy to answer any questions you may have.

Respectfully,

Meta Platforms

Donald Trump’s transition team is taking aim at a Biden-era rule requiring automakers and tech companies to report crashes that involve fully or partially autonomous vehicles, according to Reuters. Scrapping the crash reporting rule would greatly benefit Tesla, which to date, has reported the most number of crashes.

In 2021, the National Highway Traffic Safety Administration issued a standing general order (SGO) requiring automakers and tech companies to report crashes involving autonomous vehicles as well as Level 2 driver-assist systems found in millions of vehicles on the road today. Companies are now required to document collisions when an automated driving system was in use within 30 seconds of impact and report those incidents to the government. 

The idea was to create more transparency around the deployment of a new technology that purports to improve safety but has also been tied to a number of deadly incidents. Regulators argued that more data was needed to determine whether these new systems were making roads safer or simply making driving more convenient.

Tesla, in particular, came under scrutiny. The company’s Autopilot and Full Self-Driving features, which are considered Level 2 systems that require drivers to pay attention, are both covered under the rule. Since it was implemented, Tesla has reported over 1,500 crashes to the federal government, Reuters says. An analysis of the crash data shows Tesla accounted for 40 out of 45 fatal crashes reported to NHTSA through October of this year.

Tesla’s numbers were much higher than other companies, most likely due to the fact that it sells more vehicles equipped with Level 2 systems than its rivals and collects more data. But it also resulted in a huge headache for the company. NHTSA has launched several investigations into Tesla’s driver-assist technology, most of which centered on crashes reported under the SGO.

Several sources close to Tesla told Reuters that the company “despises” the standing general order and concluded that it would need a change in administration in order to get rid of it. Tesla CEO Elon Musk was one of Trump’s most vocal defenders, spending at least $277 million of his own money to back his campaign. Musk has since been appointed to head the Department of Government Efficiency with the goal of cutting government spending.

Trump is also considering getting rid of other policies opposed by Tesla, including generous subsidies for EV companies. Musk believes Tesla is better positioned to weather a subsidy-free environment than other automakers due to its scale and maturity. Musk is also lobbying Trump to ease restrictions on fully autonomous vehicles in advance of Tesla’s plans to produce its own robotaxi in 2026.

Identity theft has become a pervasive issue, affecting millions of Americans each year. In 2023 alone, American adults lost a staggering $43 billion to identity fraud. The following story illustrates the devastating impact this crime can have on individuals:

Paula Disberry, a former Colgate-Palmolive employee, was living a comfortable life when she discovered that her 401(k) account had been drained of $750,000. The shock came when she tried to access her account online, only to find it blocked. 

A fraudster had impersonated her, changing her contact details and withdrawing her entire retirement savings in a single transaction. Stories like this of financial identity theft are becoming all too common. If you live in the U.S., you’ve likely already encountered one, or worse, experienced it firsthand.

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Think identity theft won’t happen to you? Think again

The FBI’s Internet Crime Report for 2023 reveals that adults 60 and above accounted for 24.08% of all identity theft claims and suffered 41.46% of the total financial losses. While they may not face a higher risk of becoming victims, the financial toll is significantly greater than any other age group. Older adults, especially those over 60, often feel the impact more deeply. Why? They typically have more assets than younger individuals and are less likely to monitor their bank accounts daily.

Illustration of a scammer at work (Kurt “CyberGuy” Knutsson)

DON’T GET CAUGHT IN THE ‘APPLE ID SUSPENDED’ PHISHING SCAM

An age-old scam with a high-tech makeover

Identity theft has been a concern for centuries, with one of the most famous historical impostors being Frank Abagnale Jr. Abagnale claims to have successfully impersonated various professionals in the 1960s, including a Pan Am pilot and a doctor, forging checks and documents to amass a small fortune. His alleged exploits were so notorious that they inspired the film “Catch Me If You Can.”

While Abagnale’s story is a dramatic example, modern identity theft has evolved into a more pervasive threat, particularly with the rise of digital technology. The widespread availability of personal information on the web, combined with a lack of regulation preventing companies from collecting data without consent, has made it easier for criminals to exploit personal data. The scale is massive, and the impact can severely disrupt your life and that of your family.

KURT’S PICK FOR REMOVING YOUR PERSONAL DATA FROM THE INTERNET

A woman working on her laptop (Kurt “CyberGuy” Knutsson)

YOUR EMAIL DIDN’T EXPIRE, IT’S JUST ANOTHER SNEAKY SCAM

Red flags to look out for

Being aware of the warning signs of identity theft can help you take action before it’s too late. Here are some red flags to watch for.

Unexplained account activity: Keep an eye out for unfamiliar transactions or changes in your bank or credit card statements that you don’t recognize.

Credit report changes: Regularly check your credit report for new accounts that you did not open or inquiries from lenders that you did not initiate.

Missing mail or bills: If you stop receiving bills or other important mail, it could indicate that someone has changed your address without your knowledge.

Unexpected denials: If you’re denied credit unexpectedly, it might be a sign that someone is using your information to apply for loans or credit cards.

Strange communication: Be cautious of emails, texts or calls asking for personal information, especially if they create a sense of urgency or fear.

Unusual password changes: If you notice changes to your online accounts that you did not make, such as password resets or security questions being altered, act quickly to secure your accounts.

Alerts from identity theft protection services: If you use an identity theft protection service and receive alerts about suspicious activity, investigate immediately.

WHAT IS ARTIFICIAL INTELLIGENCE (AI)?

Strengthen your defenses now

Identity theft doesn’t have to be a devastating blow. You can significantly reduce your risk by being more mindful of your online habits. Here’s how.

1. Monitor your accounts regularly: Keep a close eye on your bank and credit card statements to spot unauthorized transactions early. This can prevent financial losses and protect your assets.

2. Use strong passwords: Use complex passwords and a password manager to secure your online accounts. Strong passwords are your first line of defense against cyber threats.

3. Stop oversharing: Limit the personal information you share on social media and other platforms. It’s a treasure trove for cybercriminals who use it to craft convincing fraud campaigns targeted specifically at you.

4. Invest in personal data removal services: Given the alarming rise in identity theft cases, taking proactive measures to safeguard your personal information is essential. One effective strategy is to invest in personal data removal services. hile no service promises to remove all your data from the internet, having a removal service is great if you want to constantly monitor and automate the process of removing your information from hundreds of sites continuously over a longer period of time. Check out my top picks for data removal services here. 

5. Freeze your credit: Initiate a credit freeze on your credit file with all three major credit bureaus. This restricts access to your credit records, making it difficult for identity thieves to open new accounts in your name.

6. Use an identity theft protection service: Identity theft companies can monitor personal information like your Social Security number, phone number and email address and alert you if it is being sold on the dark web or being used to open an account. They can also assist you in freezing your bank and credit card accounts to prevent further unauthorized use by criminals. See my tips and best picks on how to protect yourself from identity theft. 

7. Use two-factor authentication: Enable this extra layer of security on your accounts to make it more difficult for thieves to access your information, even if they obtain your password.

8. Be cautious with public Wi-Fi: Avoid using public Wi-Fi for sensitive transactions or use a VPN to encrypt your online activity. Using a VPN (virtual private network) service can enhance your privacy by encrypting your internet traffic, making it harder for hackers and third parties to intercept your data, especially on public Wi-Fi. A VPN masks your IP address, helping to obscure your location and online activity. While VPNs don’t directly prevent phishing emails, they reduce the exposure of your browsing habits to trackers that may use this data maliciously. With a VPN, you can securely access your email accounts from anywhere, even in areas with restrictive internet policies. For the best VPN software, see my expert review of the best VPNs for browsing the web privately on your Windows, Mac, Android and iOS devices.

9. Shred sensitive documents: Regularly shred financial documents, credit offers and other paperwork containing personal information before disposing of them.

10. Set up bank alerts: Many financial institutions offer text or email alerts for transactions on your accounts, helping you quickly spot unauthorized activity.

11. Have strong antivirus software: The best way to safeguard yourself from malicious links that install malware, potentially accessing your private information, is to have antivirus software installed on all your devices. This protection can also alert you to phishing emails and ransomware scams, keeping your personal information and digital assets safe. Get my picks for the best 2024 antivirus protection winners for your Windows, Mac, Android and iOS devices.

12. Keep software updated: Ensure your devices and antivirus software are up to date. Regular updates often include security patches that protect against vulnerabilities that scammers might exploit. Keeping your software current is a critical step in safeguarding your digital assets.

IS JUST READING THAT SKETCHY SCAMMER’S EMAIL DANGEROUS, OR DO I HAVE TO CLICK ON A LINK TO GET IN TROUBLE?

Kurt’s key takeaways

While the statistics are sobering, they don’t have to leave you feeling helpless. Identity theft is a serious threat, but with awareness and proactive steps, you can significantly reduce your risk. Remember, criminals are constantly evolving their tactics, which means we must stay one step ahead. The most powerful weapon against identity theft is knowledge. Understanding how these scams work, recognizing potential red flags and taking preventive measures can make all the difference.

Do you believe that governments should impose stricter regulations on how companies collect and use personal data to better protect consumers? Let us know by writing us at Cyberguy.com/Contact.

For more of my tech tips and security alerts, subscribe to my free CyberGuy Report Newsletter by heading to Cyberguy.com/Newsletter.

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