SBF’s $500 Million AI Bet Under Fire: US Prosecutors Unconvinced

US Prosecutors Slam SBF’s $500M AI Firm Investment as ‘Wholly Irrelevant

In the ongoing legal battle involving FTX founder Sam Bankman-Fried, the U.S. Department of Justice (DOJ) has made a significant request. The DOJ has formally requested the exclusion of evidence pertaining to certain investments, notably the $500 million investment in the artificial intelligence (AI) firm Anthropic, made by the defendant.

US DOJ Urges Exclusion of Sam Bankman-Fried’s $500 Million AI Investment in Ongoing Trial

The DOJ, in a court filing on October 8, has strongly argued that such evidence is “completely irrelevant” to the case at hand. They emphasize that allowing this evidence could introduce substantial risks, including unfair prejudice, confusion among the jury, misleading information, undue delays, and a waste of time.

Anthropic, during its Series B funding round, successfully raised $580 million, with Sam Bankman-Fried taking a leading role in this fundraising effort. Notable figures such as FTX’s former head of engineering Nishad Singh and former Alameda Research CEO Caroline Ellison were also involved as investors in this startup.

Anthropic, founded by former OpenAI VP of research Dario Amodei, has emerged as a formidable competitor to OpenAI in the field of generative artificial intelligence. Their flagship model, Claude 2, is a highly capable chatbot, often described as a “friendly, enthusiastic colleague” or a “personal assistant” that can assist with various tasks using natural language.

Recently, Anthropic introduced Claude Pro, a premium version of Claude 2, designed to handle extensive conversations, even those involving large attachments.

The startup has also gained significant backing, with SK Telecom Co. Ltd. investing $100 million in August and a substantial $450 million funding round in March that included participation from tech giants like Google, Salesforce Ventures, and Zoom Ventures. Notably, Amazon has pledged a significant investment of up to $4 billion in Anthropic, securing a minority stake in this high-profile company.

The DOJ’s stance is that while Anthropic’s fundraising aims to value the company between $20 billion and $30 billion, introducing evidence related to the defendant’s investment could potentially affect the recovery for FTX customers and other parties involved in the FTX bankruptcy proceedings.

However, the DOJ firmly asserts that such evidence holds no relevance to the core allegations of wire fraud against the defendant, emphasizing that the profitability of certain investments is immaterial in this context.