Fun fact: I consider myself a pretty bad writer and initially started the newsletter to try and get better at it. The results have been mixed on that front so apologies if you got confused by the "purple prose". I'm trying.
Anyway, my point was:
1. The disclosures point to "OpenAI Startup Fund I" being under the control of a fake company and CEO.
2. The fake company and CEO in question looks like the creation of an AI hallucination.
3. If a fake company and CEO were intentionally used by OpenAI, this isn't a minor infraction and there are highly consequential ramifications to consider given Altman's prior "ownership" of the fund, reported concerns it was being used to circumvent OpenAI Board oversight/governance, and participation in the fund was allegedly a means to invest in OpenAI.
Much of the piece is admittedly a helter-skelter collection of disclosures and explanations focused on supporting #1 and I don't really get into my rationale for #3.
Overall, it makes for bad long-form reading, but it did compel BI to do the needed journalistic follow-up work, made OAI acknowledge the filing was "illegitimate", and pushed the story forward.
We now know, according to OpenAI:
1. The company and CEO doesn't exist to their knowledge.
2. The document indicating this fake company and CEO controlled "Fund I" isn't legitimate and completely fabricated.
3. They're not willing to elaborate/explain how or why these "fabricated" entities got filed by them.
It's ugly spaghetti prose, but I'd say the write-up worked as intended.
I think the linked interpretation is very, very reasonable and it's a big reason why I tried to deemphasize all the "stuff" you've highlighted in my piece.
I think most of us would agree the person in question - if they're real - is exhibiting signs of a mental health crisis.
That said, I wouldn't have written the piece if I felt the aforementioned interpretation was the primary explanation to everything I'm seeing in the disclosures. I proactively tried as I went through the disclosures.
The issue I'm having is - regardless of what this person is able to concoct with ChatGPT or other methods - they shouldn't have been able to insert themselves and their Vespers "creation" into OpenAI Startup Fund I GP LLC's CA filings even if they wanted to.
One could argue they either needed to "hack" into the CA filing to insert themselves as Manager/CEO or someone at OpenAI allowed it happen (knowingly or unknowingly is tbd).
It also doesn't help OpenAI won't explain 1) how it happened, 2) why it took so long to catch it, and 3) why it wasn't reported to regulators once discovered:
"[OpenAI] declined to elaborate on how exactly fabricated documents came to be filed with the state of California."
I recognize this sounds a bit conspiratorial, but there are elements (I didn't cover) to this person's filings involving OAI that looks very thoughtful/intentional and are hard to dismiss as random/coincidental/hallucinated actions of someone that likely needs help.
And OAI's "response" didn't help address the actual issues I'm seeing.
Whilst I guess it's not entirely impossible that someone would become obsessed with OpenAI, GPT, online filing, fraud and espionage after OpenAI had accidentally attributed ownership of its venture capital fund to a shell company registered in his existing multiple aliases on the same day, I think Ockham's razor suggests the story fits better the other way round.
(I'm not sure what the security processes for online filings are, but it wouldn't surprise me if someone sufficiently motivated and ambivalent about it being a felony could provide the necessary fake documentation, social engineering and/or brute force hacking to get their registered business given a notional role in someone else's unrelated business on a nonbinding document, at least until the other business noted and corrected the record. I know GPT "hallucinates" real names, but picking the existing aliases of the sort of person most likely to go down those rabbit holes seems quite the coincidence. And it'd have been odder if OpenAI's response was anything other than a generic spokesperson denial)
I just want to comment that the image of the Santa Ana property looks a lot like the main character’s apt in the movie Momento, adding some umami to the whole vibe.
Having seen first hand a similar situation unfold, the most heartbreaking feeling is finding out a friend broke your trust. That said, you really can't fix the issues and protect friends at the same time. Things have to be cleaned up and trust restored.
The Board needs to be highly vigilant about pushing for transparency and getting outside independent help to get to the bottom of things.
I repeat. Financial mismanagement and abuse is not something you try to fix in-house. The reason being you really don't know who has had their hand in the cookie jar (on purpose or accidentally) and there is going to be incentive by some to not expose the skeletons and the laws broken.
People want to protect friends but the Board really needs to retain professionals to run a forensic audit, get a full picture of what happened, and put in the proper financial controls. Cost isn't an excuse. Many law and accounting firms offer pro-bono services to non-profits, and I'm sure there would be plenty of firms who would be happy to help Hacker Dojo clean things up.
Transparency is very much part of the non-profit system. Non-Profits have to annually file an IRS Form 990 (it's like an annual report) which discloses finances and are required to have them available for public inspection during business hours.
Sounds like Hacker Dojo was not following the rules already in place to prevent this sort of abuse.
It's not that difficult to abuse power in the non-profit system. I'm not referring to blatant theft by an employee, but other shinagigans usually by the founders--like mixing personal assets with the non-profit assets.
1. Is the non-profit in Deleware? So many shady non-profits set up shop in Deleware. When you read the requirements you will see exactly why. I've gotten to the point, I will only listen to CA non-profits when it comes to donating. California has some stringent requirements.
2. Yes--they have rules, and procedures, but there's a lot of people who don't follow the rules. The rules are getting harder to get around, but so many non-profits are there for one reason. The reason--provide a job, and a good wage to the founders. The Obama administration enacted rules that make non-profits more transparent though.
3. I have watched a few non-profit founders make, usually a husband and wife, very rich. I could go on at lenght, but tired, and it seems like no one really cares.
4. When ever I get someone asking for money for their little non-profit, I go to, forget the name--Guidestar. I download the free preview. I go to the bottom of all the pages, and look at their 1040's. I then look for the one, or two people making a lot of money. There's always one, or two individuals. I get so discouraged, and wonder if anyone in these nonprofits really cares about what they proclaim.
Don't bust on Delaware. My NP is registered in Delaware, as is the Apache Foundation. Now, 5 years later, I wish I'd registered first in CA, but being in DE is not a black mark. I did it there because Apache was there, so I figured, good enough for them, good enough for us. Additionally, most US businesses are registered in DE.
The finance report wouldn't show individual transactions. So if you used the credit card to buy yourself $50 worth of groceries, it's likely to fly under the radar. Hacker Dojo does have the general breakdown of their finances publicly -- it's shown every month during their member meetings. However, one could easily hide the $50 in a general group like "janitorial supplies".
When someone embezzles $30k, they don't do it in one transaction. That would be far too obvious. If you space it out over a year, one could make it fairly invisible.
The finance report wouldn't have shown individual transactions but the financial controls required to properly put together those annual filings would have caught unusual activity (at the very least dis-incentivized prolonged mismanagement). Also keep in mind proper controls would include having accountants put together the reports and run internal audits.
The other issue is these charges (apparently) weren't invisible/low key transactions. If someone can literally thumb through recent statements and immediately identify suspicious activity like Gym memberships and Vegas trips then that's an obvious problem.
It's one thing if $30k was missing and the company was generating $30 million in cash flow but Hacker Dojo only has $300k in the bank and I have a hard time believing embezzling $30k could be as easily hidden in small transactions if proper controls were in place.
Based on my experiences (formerly did activist investing for 8+ years) there's a lot more pragmatism for all parties involved.
Activist don't just suddenly show up and get board seats. There's usually an ongoing issue/debate that management teams/boards are dealing with behind the scenes long before an activist is actively pushing for board seats.
Also keep in mind, even if an activist ("easily") gets a board seat, there's still an extraordinary amount of work to be done. It's easy being a board member when times are great, but being on the board of a company undergoing a turnaround is a completely different experience.
Anyway, my point was:
1. The disclosures point to "OpenAI Startup Fund I" being under the control of a fake company and CEO.
2. The fake company and CEO in question looks like the creation of an AI hallucination.
3. If a fake company and CEO were intentionally used by OpenAI, this isn't a minor infraction and there are highly consequential ramifications to consider given Altman's prior "ownership" of the fund, reported concerns it was being used to circumvent OpenAI Board oversight/governance, and participation in the fund was allegedly a means to invest in OpenAI.
Much of the piece is admittedly a helter-skelter collection of disclosures and explanations focused on supporting #1 and I don't really get into my rationale for #3.
Overall, it makes for bad long-form reading, but it did compel BI to do the needed journalistic follow-up work, made OAI acknowledge the filing was "illegitimate", and pushed the story forward.
We now know, according to OpenAI:
1. The company and CEO doesn't exist to their knowledge. 2. The document indicating this fake company and CEO controlled "Fund I" isn't legitimate and completely fabricated. 3. They're not willing to elaborate/explain how or why these "fabricated" entities got filed by them.
It's ugly spaghetti prose, but I'd say the write-up worked as intended.