The United States plans to sign a memorandum of understanding to cooperate with South Korea and Japan in the fight against false propaganda and disinformation.

It will be the first such agreement that Washington signs with its Asian allies, and it comes as U.S. officials and lawmakers accuse the People’s Republic of China of conducting “deceptive online campaigns” targeting the United States and other countries. Chinese officials have rejected the accusation.

Liz Allen, the U.S. undersecretary of state for public diplomacy and public affairs, is traveling to Asia this week. Allen will be sealing the agreement with South Korea and Japan on countering disinformation, according to U.S. and diplomatic sources.

U.S. President Joe Biden, South Korean President Yoon Suk Yeol and Japanese Prime Minister Fumio Kishida have agreed to find ways to coordinate efforts to counter disinformation, after the three leaders held talks during their first trilateral summit at Camp David in August.

“President Yoon mentioned the threat from false propaganda and disinformation in his address to the joint session of U.S. Congress in April. In this regard, we are now discussing the possible follow-up measures with the U.S.,” an official from the South Korean Embassy told Voice of America on Thursday.

In a statement on Thursday, House Foreign Affairs Committee Chairman Michael McCaul condemned the “increasingly deceptive online campaigns targeting the U.S. and other countries” by the Chinese Communist Party.

“The CCP has made clear it will use every tactic to spread its malign intent,” the Republican congressman said.

The South Korean government has identified 38 suspected fake Korean-language news websites that it believes are operated by Chinese companies. For example, in November, South Korea’s National Intelligence Service said two Chinese public relations companies, Haimai and Haixun, were allegedly creating such websites, according to Seoul-based Yonhap News Agency.

The State Department said Allen, while in Tokyo, will hold bilateral discussions with Japanese Ministry of Foreign Affairs officials that include a focus on countering malign foreign influence.

In a report issued in September, the State Department’s Global Engagement Center accused the Chinese government of using a combination of tactics in a bid to create a world in which Beijing, either explicitly or implicitly, controls the flow of critical information. The U.S. has warned that China is pouring billions of dollars into efforts to reshape the global information environment and, eventually, bend the will of multiple nations to Beijing’s advantage.

The Chinese Ministry of Foreign Affairs has pushed back, saying the report by U.S. State Department’s Global Engagement Center “misrepresents facts and truth.” A spokesperson from the Chinese Foreign Ministry called GEC the command center of “perception warfare.”

James Rubin, special envoy for the State Department’s Global Engagement Center, has said that Washington is working with allies to detect and counter misinformation and disinformation around the world.

In May, the U.S. signed a memorandum of understanding with North Macedonia, and in September, another with Bulgaria, both aimed at enhancing cooperation in countering foreign information manipulation.
…

Vietnam, with the world’s second-largest reserves of the rare earths used in such modern devices as electric vehicle batteries and smart phone screens, is intensifying mining of the critical minerals. The industry, though, faces high processing costs, environmental concerns, and the takedown of industry leaders for illegal mining and mineral sales.

Vietnam’s rare earth resources are second only to those of China, which has held a tight monopoly since the 1980s. With Chinese relations with the West becoming more volatile, many countries are looking for other sources for the elements.

“China produces about 60% of the world’s rare earths but what they process is over 90%,” Louis O’Connor, CEO of Strategic Metals Invest, an Irish investment firm, told VOA.

“It was not a good idea to allow one country to dominate critical raw materials that are critical to all nations’ economic prosperity and increasingly military capability,” he said.

O’Connor added that while China has the world’s majority of raw materials, its dominance over technical expertise in the complex and costly process of rare earth refining is even greater. China has 39 metallurgy universities and approximately 200 metallurgists graduate weekly in the country, he said.

“The ability to go from having the potential to end product — that’s the most challenging, complicated, and expensive part,” O’Connor said. “For Vietnam, even if they have the deposits, what they don’t have is the human capital, or the engineering expertise.”

Vietnam increased rare earth mining tenfold with its output hitting 4,300 tons last year, compared to 400 tons in 2021.  according to the U.S. Geological Survey. Vietnam said in July it plans to process 2 million tons of rare earth ores by 2030 and produce 60,000 tons of rare earth oxides annually starting in 2030. This year, China’s mining quota is set at 240,000 tons to meet the demand for the electric vehicle industry, according to Chinese government data.

The United States and other countries are interested in Vietnam increasing its production of rare earths.

“The U.S. wants Vietnam to become a more important supplier and perhaps replace China, if possible, because of the risk that the U.S. may face in relying on rare earth supplies from China,” Le Hong Hiep, senior fellow at the ISEAS-Yusof Ishak Institute in Singapore told VOA.

“Not only the U.S., but also other partners like Korea, Japan, and Australia also are working with Vietnam to develop the rare earth industry,” he said.

South Korean President Yoon Suk Yeol signed a memorandum of understanding in Vietnam in June to establish a joint supply chain center for rare earth minerals.

“We reached an agreement that there is more potential to develop rare earths together, as they are abundant in Vietnam,” Yoon said in a June 23 statement with Vietnam’s president Vo Van Thuong.

The United States signed such a memorandum on cooperation in the rare earths sector during President Joe Biden’s visit to Hanoi on September 9.

“We see Vietnam as a potential critical nexus in global supply chains when it comes to critical minerals and rare earth elements,” Marc Knapper, U.S. ambassador to Vietnam, said on September 13 during a digital press briefing. “We certainly want to work together to ensure that Vietnam is able to take advantage of its rich resources in a way that’s also sustainable.”

Scandal

However, a handful of Vietnam’s key rare earth enterprises have become entangled in scandal. On October 20, police arrested six individuals for mining and tax violations.

Police arrested Doan Van Huan, chairman of the Hanoi-based Thai Duong Group that operates a mine in Yen Bai province, and its chief accountant, Nguyen Van Chinh, for violating regulations on the exploration and exploitation of natural resources and accounting violations, the Public Security Ministry said. The two were accused of making $25.5 million from the illegal sale of rare earth ore and iron ore. Police raided 21 excavation and trading sites in Yen Bai province and three other locations. Authorities seized an estimated 13,700 tons of rare earth and more than 1,400 tons of iron ores, according to local publication VnExpress.

Although government statements did not state what made Thai Duong’s rare earth sales illegal, a source told Reuters raw Yen Bai mine ore had been exported to China to avoid high domestic refining costs, in violation of Vietnamese rules.

The chairman, Luu Anh Tuan, and accountant, Nguyen Thi Hien, of the country’s primary rare earth refining company, Vietnam Rare Earth JSC, were also arrested for violating accounting regulations in trading rare earth with Thai Duong Group. Dang Tran Chi, director of Hop Thanh Phat, and his accountant Pham Thi Ha were arrested on the same charge.

Looking at corruption in Vietnam’s rare earth industry will be “top of the list” for future investors, O’Connor said.

“Corruption levels would have to be looked at,” he said. “If you’re buying a metal that’s going to need to perform in a jet engine, for example or a rocket … they have to be sure of the purity levels. The chain of custody of these, it’s more important really than gold.”

Vietnam committed to industry

Hanoi is committed to developing the rare earths industry even though economic gains are limited by environmental and production costs, Hiep told VOA.

“Vietnam is now interested in promoting this industry mainly because of the strategic significance,” Hiep told VOA. “If you can grow this industry and become a reliable supplier of rare earth products for the U.S. and its allies, Vietnam’s strategic position will be enhanced greatly.”

“Whether that will be successful, we have to wait and see,” he added.

There are also environmental concerns for the growing industry, particularly as a crackdown on Vietnam’s environmental organizations and civil society leaves little room for public speech.

“The biggest challenge is going to be how do you handle the waste process from the mining,” said Courtney Weatherby, deputy director of the Southeast Asia Program at Washington’s Stimson Center told VOA.

“Ensuring that development happens in a sustainable way takes a lot of different actors,” she said.

But Duy Hoang, executive director of unsanctioned political party Viet Tan, said the room for outside actors to express concern over environmental and labor practices is narrowing.

“What we’re seeing is sort of a shrinking space for civil society to speak out and a number of the leading environmental activists are now in jail. We don’t have their voices which are very needed and I think there may be self-censorship going on by other activists,” he said. “There has to be accountability.”
…

American leadership is essential in establishing norms and laws to “determine how we both glean the promise and manage the peril” of emerging technologies like artificial intelligence and digital economic and social platforms used to connect billions of people around the world, a White House adviser told VOA.

The Biden administration has rolled out a number of initiatives on the topic — most recently, an executive order that aims to set new AI safety and security standards. That order relies on cooperation from private developers and other countries, “because the attackers are in one set of countries, the infrastructure is in another and the victims are global,” said Anne Neuberger, deputy national security adviser for cyber and emerging technology at the National Security Council.

Neuberger sat down with VOA White House Correspondent Anita Powell to explain these complex, compelling technologies and how she thinks they have exposed the worst but also the best in humanity.

The following has been edited for length and clarity.

VOA: Thank you so much for sitting down with VOA today. Can you walk us through the concrete outcomes of the recent meeting between President Joe Biden and Chinese President Xi Jinping in the areas you cover — cybersecurity, AI and the digital economy?

Anne Neuberger, White House deputy national security adviser: Of course, strategic technologies are very important to both of our countries’ growth and national security — and we’re global players on a global stage. The most important part of the discussion was two leaders coming together to say: While we are in competition, we’re committed to working together on areas where we can collaborate – areas like climate change, like discussions of what are the rules for artificial intelligence.

VOA: Would you assess that the meeting made any progress, especially on AI regulation?

Neuberger: Certainly very good discussions related to an agreement for the countries to sit down and establish a working group on AI [about] appropriate guardrails and guidelines in this area.

VOA: I’m going to stick with AI and the administration’s recent moves, like the AI Bill of Rights and also the attempt to set some norms at the recent London summit on AI. Why does the administration think U.S. leadership matters so much here?

Neuberger: For two reasons. First, the United States is a committed democracy and AI is a major technology that brings both promise and peril. It is up to us to determine how we both glean the promise and manage the peril. President Biden has made that clear in his game-changing executive order that, as a country, we must manage the perils in order to glean the promise.

VOA: Speaking of the perils of AI, what is the administration doing to prevent the malicious use of generative AI in both conflicts and contests? I’m talking about conflicts like Israel and Ukraine, but also contests like the upcoming elections in Congo, in Taiwan and here in the United States.

Neuberger: We’ve seen new AI models that generate very realistic videos, very realistic images. In terms of generative AI related to elections, I want to lift up one of the voluntary commitments that the president negotiated, which was around watermarking: having a visible and potentially invisible mark on an AI-generated image or video that notes that this is AI-generated, to alert a viewer. An invisible mark could be used so that, even if there are attempts to remove this mark, the platforms themselves can still be able to portray that message and help educate individuals. This is still an area of evolving technology. It’s getting better and better. But companies made commitments to start marking content that they generate. And I know a number of social media platforms are also making commitments to ensure that they display messages to help consumers who see such content know that it is generated by artificial intelligence.

VOA: Moving on to cybersecurity and malign actors like North Korea and Russia, what is the administration doing to curb their work in this area?

Neuberger: We see North Korea really using cyberattacks as a way to get money because they’re such a heavily sanctioned regime. So North Korea moved from targeting banks to targeting … cryptocurrency infrastructure around the world. And the White House has had a focused effort to bring together all elements we have to fight that with Treasury Department designations.

There’ll be further designations coming up for the cryptocurrency mixers that launder funds stolen from those cryptocurrency infrastructures. We also have been working with the industry to press them to improve the cybersecurity of their systems as well as law enforcement. U.S. law enforcement has been cooperating with partners around the world to take down that server infrastructure and to arrest the individuals who are responsible for some of this activity.

VOA: Tell us a little bit about the counter-ransomware initiative you’re working on.

Neuberger: Absolutely. Essentially, criminal groups, many of which are based in Russia with infrastructure operating from around the world, are locking systems … in order to request that the system owners pay ransom. In the United States alone in the last two years, $2.3 billion was paid in ransom. It’s a fundamentally transnational fight. … What we’ve done is assemble 48 countries, Interpol [and] the European Union to take this on together, because we know that the attackers are in one set of countries, the infrastructure is in another, and the victims are global. As the White House built this initiative, we ensure that the leadership is diverse.

So, for example, the leaders of the effort to build capacity around the world are Nigeria and Germany — intentionally, a country from Africa and a country from Europe, because their needs are different. And we wanted to ensure that as we’re helping countries build the capacity to fight this, we’re sensitive to the different needs of a country like Nigeria, like Rwanda, like South Africa, like Indonesia. Similarly, there’s an effort focused on exercising information, sharing information together.

You asked about the key deliverables from this most recent meeting. I’ll note three big ones. First, we launched a website and a system where countries can collaborate when they’re fighting a ransomware attack, where they can ask for help [or] learn from others who fought a similar attack. Second, we made the first ever joint policy statement — a big deal — 48 countries committing that countries themselves will not pay ransoms, because we know this is a financially driven problem. And third, the United States committed that we would be sharing bad wallets [that] criminals are using to move money around the world so other countries can help stop that money as it moves as well. So that’s an example of three of the many commitments that came out of the recent meeting.

VOA: Let’s talk about the Global South, which has pioneered development of really interesting digital economic technologies like Kenya’s M-PESA, which was rolled out in, like, 2007. Now the U.S. has Venmo, which is modeled on that. How is the U.S. learning from the developing world in the development of these projects and also the perils of these products?

Neuberger: M-PESA is a fantastic example of the promise of digital tech. Essentially, Kenya took the fact that they had a telecom infrastructure, and built their banking infrastructure riding on that, so they leapt ahead to enable people across the country to do transactions online. When you look at Ukraine in the context of Russia’s invasion of Ukraine, Ukraine quickly moved their government online, really building on lessons learned from Estonia, to enable Ukrainians — many who are in Poland and Hungary — to continue to engage with their government in a digital way.

The U.S. Agency for International Development is tremendously proud of that Ukrainian project and is using it as a model as we look to other countries around the world. So we’re learning a lot from the creativity and innovation; what we want to bring to that is American development, skill and aid, and also plugging in American tech companies who can accelerate the rollout of these projects in countries around the world, because we still believe in the promise of digital. But you mentioned the peril, and that’s where cybersecurity comes in.

VOA: This lines us up perfectly for my final question, about the promise and the peril. In the digital world, people can hide behind anonymity and say and do awful things using tools that were meant to improve the world. How do you keep your faith in humanity?

Neuberger: It’s a tremendously important question. It’s one that’s personally important to me. My great-grandparents lost their lives in Nazi death camps. And those members of my family who survived — some survived through the horrors of the camp, some managed to hide out under false identities. And I often think that the promise of digital has also made our identities very evident. Sometimes when I’m just browsing Amazon online, and it recommends a set of books, I think to myself: I wonder how I’d hide if what happened to my grandparents came for me. So as a result, I think that even as we engage with these technologies, we have to ensure that vulnerable populations are protected.

So, the president’s working with AI companies to say companies have an obligation to protect vulnerable populations online, to ensure that we’re using AI to detect where there’s bullying online, where there’s hate speech that goes against common practices that needs to be addressed; where there are AI-generated images related to children or women or other vulnerable populations, that we use AI to find them and remove them; and certainly use law enforcement and the power of law enforcement partnerships around the world to deter that as well. Freedom of speech is a part of free societies. Freedom from harm needs to be a fight we take on together.

VOA: Thank you so much for speaking to our audience.

Neuberger: Thank you.
…

Since the start of Russia’s full-scale invasion of Ukraine, drone production in the country has surged. Ukrainian businesses have shifted from manufacturing products for peacetime to producing equipment for wartime. From Kyiv, Myroslava Gongadze explains how Ukrainian ingenuity is altering the course of the war. Camera: Eugene Shynkar.
…

The United States on Wednesday imposed sanctions on a virtual currency mixer the Treasury Department said has processed millions of dollars worth of cryptocurrency from major heists carried out by North Korea-linked hackers.

The U.S. Treasury Department in a statement said virtual currency mixer Sinbad, hit with sanctions on Wednesday, processed millions of dollars worth of virtual currency from heists carried out by the North Korea-linked Lazarus Group, including the Axie Infinity and Horizon Bride heists of hundreds of millions of dollars.

Lazarus, which has been sanctioned by the U.S., has been accused of carrying out some of the largest virtual currency heists to date. In March 2022, for example, they allegedly stole about $620 million in virtual currency from a blockchain project linked to the online game Axie Infinity.

“Mixing services that enable criminal actors, such as the Lazarus Group, to launder stolen assets will face serious consequences,” Deputy Treasury Secretary Wally Adeyemo said in the statement on Wednesday.

“The Treasury Department and its U.S. government partners stand ready to deploy all tools at their disposal to prevent virtual currency mixers, like Sinbad, from facilitating illicit activities.”

A virtual currency mixer is a software tool that pools and scrambles cryptocurrencies from thousands of addresses.

Sinbad is believed by some experts in the industry to be a successor to the Blender mixer, which the U.S. hit with sanctions last year over accusations it was being used by North Korea.

The Treasury said Sinbad is also used by cybercriminals to obscure transactions linked to activities such as sanctions evasion, drug trafficking and the purchase of child sexual abuse materials, among other malign activities. 

Wednesday’s action freezes any U.S. assets of Sinbad and generally bars Americans from dealing with it. Those that engage in certain transactions with the mixer also risk being hit with sanctions. 
…

Almost all U.S. jobs, from truck driver to childcare provider to software developer, include skills that can be done, or at least supplemented, by generative artificial intelligence (GenAI), according to a recent report.

GenAI is artificial intelligence that can generate high-quality content based on the input data used to train it.

“AI is likely to touch every part of every job to some degree,” says Cory Stahle, an economist with Indeed.com, which released the report.

The report finds that almost one in five jobs (19.7%) — like IT operations, mathematics and information design — faces the highest risk of being affected by AI because at least 80% of the job skills those positions require can be done reasonably well by GenAI.

But that doesn’t mean that those jobs will eventually be lost to robots.

“It’s important to recognize that, in general, these technologies don’t affect entire occupations. It actually is very rare that a robot will show up, sit in somebody’s seat to do everything that someone does at their job,” says Michael Chui of the McKinsey Global Institute (MGI), who researches the impact of technology and innovation on business, the economy and society.

Indeed.com researchers analyzed more than 55 million job postings and found that GenAI can perform 50% to almost 80% of the skills required in 45.7% of those job listings. In 34.6% of jobs listed, GenAI can handle less than 50% of the skills.

Jobs that require manual skills or a personal touch, such as nursing and veterinary care, are the least likely to be hard hit by AI, the report says.

In the past, technological advances have mostly affected manual labor. However, GenAI is expected to have the most effect on so-called knowledge workers, generally defined as people who create knowledge or think for a living.

But, for now, AI does not appear poised to steal anyone’s job.

“There are very few jobs that AI can do completely. Even in jobs where AI can do many of the skills, there are still aspects of those jobs that AI cannot do,” Stahle says.

Rather than replace workers, researchers expect GenAI to enhance the work people already do, making them more efficient.

“This is something that, in many ways, we believe is going to unlock human potential and productivity for many workers across many different sectors of the economy,” Stahle says.

“There are a number of things that can happen,” Chui adds. “One is, we simply do more of something we were already doing, and so imagine if you’re a university professor or a teacher, and the grading can be done by machine rather than you. You can take those hours and, instead of grading, you can actually start tutoring your students, spending more time with your students, improving their performance, helping them learn.”

American workers need to begin using the new technology if they hope to remain competitive, according to Chui.

“Workers who are best able to use these technologies will be the most competitive workers in the workforce,” he says. “It was true before, but it’s more true than ever, that we’re all going to have to be lifetime learners.”

A survey developed by Chui finds that almost 80% of workers have experimented with AI tools.

“One of the great powers of these generative AI tools, so far, is they’ve been designed in such a way to make it easy for really anybody to use these types of tools,” Stahle says. “I really believe that people should be looking to embrace these tools and find ways to incorporate them into the work that they’re already interested in doing.”

Ultimately, could one of the unexpected benefits of AI be more efficient employees who work less?

“In general, Americans work a lot,” Chui says. “Maybe we don’t have to work so long. Maybe we have a four-day work week … and so you could give that time back to the worker.”
…

Cindy Dyer, the U.S. ambassador-at-large for monitoring and combating trafficking, is planning to push Cambodia’s new government to ramp up its efforts to crack down on cyberscam operations that trap many trafficking victims in slavelike conditions.

A recently completed visit to Phnom Penh by Dyer “will serve as an opportunity for information sharing and coordination on anti-trafficking efforts,” the State Department said last week in a release.

Dyer met with a range of officials “with the objective of building a relationship with the new government for future coordination and advocating for progress in the most critical areas, including increased investigations and prosecutions of cyberscam operations,” said the November 15 release.

Cambodia’s role as host of cybercriminals has been in an international spotlight. The U.N. High Commissioner for Human Rights (UNHCHR) released a report this summer estimating that the industry has victimized 100,000 people in Cambodia.

Lured by promise of jobs

Operators of these scamming networks recruit unwitting workers from across Asia, often with the promise of well-paying tech jobs, and then force them to attempt to scam victims online while living in slavelike conditions, according to the report.

Countries including Indonesia, Taiwan and China have urged countries like Cambodia and Laos to crack down on the industry, while warning their own citizens of the dangers in traveling to these countries, according to the UNHCHR report.

The U.S. State Department’s annual report on global human trafficking, released in June, placed Cambodia in Tier 3, meaning the government has made insufficient efforts to address human trafficking and does not meet the minimum standards.

During her two-day visit to Cambodia that began November 15, Dyer met with officials from the ministries of justice, labor and social affairs, as well as representatives of the National Police and the National Committee for Counter Trafficking (NCCT) within the Ministry of Interior, according to an email from the U.S. Embassy in Phnom Penh. Dyer also held discussions with civil society groups working on combating human trafficking.

The discussions focused “on Cambodia’s efforts to protect trafficking victims, including providing protection assistance services for victims of trafficking and vulnerable migrants, capacity building for service providers and government officials to improve victim identification and referral, and addressing emerging trends in forced criminality,” the State Department release said.

More training urged

Am Sam Ath, operations director at the Cambodian rights group Licadho, told VOA Khmer that Dyer’s visit highlighted the need for Cambodia to tackle human trafficking and online scams.

“We see that the United States … ranks Cambodia third in the blacklist of human trafficking. It also has a lot of impact on our country, and if Cambodia does not make an effort further in the prevention of human trafficking or online scams, the ranking cannot be improved,” he said by telephone from the group’s Phnom Penh office.

He called on the Cambodian government to strengthen the capacity of officials and authorities to crack down on online crime.

“This crime problem is technologically modern, so the authorities involved in it have to get more training to keep up with the situation, as well as the timing of the crime,” Am Sam Ath added.

National Police spokesperson Chhay Kim Khoeun and Justice Ministry spokesperson Chin Malin declined to comment on Dyer’s visit, referring questions to Chou Bun Eng, permanent deputy chairman of the National Committee for Counter Trafficking. VOA Khmer called Chou Bun Eng, but she did not respond to a request for comment.

U.S. Embassy spokesperson Katherine Diop told VOA Khmer that Dyer’s visit to Cambodia was part of a U.S. effort across the world to encourage governments to take responsibility for preventing human trafficking and protecting victims.

“The United States stands with the Cambodian people to identify, support and seek justice for human trafficking victims,” she wrote in an email.

The UNHCHR report released in late August said the online scams were occurring in five countries in Southeast Asia: Cambodia, Thailand, Laos, Myanmar and the Philippines.

“People who have been trafficked into online forced criminality face threats to their right to life, liberty and security of the person,” said the U.N. report. “They are subject to torture and cruel, inhuman and degrading treatment or punishment, arbitrary detention, sexual violence, forced labor and other forms of labor exploitation as well as a range of other human rights violations and abuses.”

Cambodia first acknowledged the issue last year when Interior Minister Sar Kheng said in August that officials were being deployed across the country to check hotels, casinos and other establishments for potential trafficking victims.

The government has since announced sporadic operations to free victims and arrest traffickers. However, experts recently told VOA Khmer that these efforts have not noticeably curbed the illegal operations or caught ringleaders of the trafficking networks.
…

The ousted leader of ChatGPT-maker OpenAI is returning to the company that fired him late last week, culminating a days-long power struggle that shocked the tech industry and brought attention to the conflicts around how to safely build artificial intelligence.

San Francisco-based OpenAI said in a statement late Tuesday, “We have reached an agreement in principle for Sam Altman to return to OpenAI as CEO with a new initial board.”

The board, which replaces the one that fired Altman on Friday, will be led by former Salesforce co-CEO Bret Taylor, who also chaired Twitter’s board before its takeover by Elon Musk last year. The other members will be former U.S. Treasury Secretary Larry Summers and Quora CEO Adam D’Angelo.

OpenAI’s previous board of directors, which included D’Angelo, had refused to give specific reasons for why it fired Altman, leading to a weekend of internal conflict at the company and growing outside pressure from the startup’s investors.

The chaos also accentuated the differences between Altman — who’s become the face of generative AI’s rapid commercialization since ChatGPT’s arrival a year ago — and members of the company’s board who have expressed deep reservations about the safety risks posed by AI as it becomes more advanced.

Microsoft, which has invested billions of dollars in OpenAI and has rights to its current technology, quickly moved to hire Altman on Monday, as well as another co-founder and former president, Greg Brockman, who had quit in protest after Altman’s removal.

That emboldened a threatened exodus of nearly all of the startup’s 770 employees who signed a letter calling for the board’s resignation and Altman’s return.

One of the four board members who participated in Altman’s ouster, OpenAI co-founder and chief scientist Ilya Sutskever, later expressed regret and joined the call for the board’s resignation.

Microsoft in recent days had pledged to welcome all employees who wanted to follow Altman and Brockman to a new AI research unit at the software giant. Microsoft CEO Satya Nadella also made clear in a series of interviews Monday that he was still open to the possibility of Altman returning to OpenAI, so long as the startup’s governance problems are solved.

“We are encouraged by the changes to the OpenAI board,” Nadella posted on X late Tuesday. “We believe this is a first essential step on a path to more stable, well-informed, and effective governance.”

In his own post, Altman said that “with the new board and (with) Satya’s support, I’m looking forward to returning to OpenAI, and building on our strong partnership with (Microsoft).”

Co-founded by Altman as a nonprofit with a mission to safely build so-called artificial general intelligence that outperforms humans and benefits humanity, OpenAI later became a for-profit business but one still run by its nonprofit board of directors. It’s not clear yet if the board’s structure will change with its newly appointed members.

“We are collaborating to figure out the details,” OpenAI posted on X. “Thank you so much for your patience through this.”

Nadella said Brockman, who was OpenAI’s board chairman until Altman’s firing, will also have a key role to play in ensuring the group “continues to thrive and build on its mission.”

Hours earlier, Brockman returned to social media as if it were business as usual, touting a feature called ChatGPT Voice that was rolling out to users.

“Give it a try — totally changes the ChatGPT experience,” Brockman wrote, flagging a post from OpenAI’s main X account that featured a demonstration of the technology and playfully winking at recent turmoil.

“It’s been a long night for the team and we’re hungry. How many 16-inch pizzas should I order for 778 people?” the person asks, using the number of people who work at OpenAI. ChatGPT’s synthetic voice responded by recommending around 195 pizzas, ensuring everyone gets three slices.

As for OpenAI’s short-lived interim CEO Emmett Shear, the second interim CEO in the days since Altman’s ouster, he posted on X that he was “deeply pleased by this result, after ~72 very intense hours of work.”

“Coming into OpenAI, I wasn’t sure what the right path would be,” wrote Shear, the former head of Twitch. “This was the pathway that maximized safety alongside doing right by all stakeholders involved. I’m glad to have been a part of the solution.”
…

The U.S. government dealt a massive blow to Binance, the world’s largest cryptocurrency exchange, which agreed to pay a roughly $4 billion settlement Tuesday as its founder and CEO Changpeng Zhao pleaded guilty to a felony related to his failure to prevent money laundering on the platform. 

Zhao stepped down as the company’s chief executive, and Binance admitted to violations of the Bank Secrecy Act and apparent violations of sanctions programs, including its failure to implement reporting programs for suspicious transactions. 

“Using new technology to break the law does not make you a disruptor, it makes you a criminal,” said U.S. Attorney General Merrick Garland, who called the settlement one of the largest corporate penalties in the nation’s history. 

As part of the settlement agreement, the U.S. Treasury said Binance will be subject to five years of monitoring and “significant compliance undertakings, including to ensure Binance’s complete exit from the United States.” Binance is a Cayman Islands limited liability company. 

The cryptocurrency industry has been marred by scandals and market meltdowns. 

Rival of FTX founder

Zhao was perhaps best known as the chief rival to Sam Bankman-Fried, the 31-year-old founder of FTX, which was the second-largest crypto exchange before it collapsed last November. Bankman-Fried was convicted earlier this month of fraud for stealing at least $10 billion from customers and investors. 

Zhao, meanwhile, pleaded guilty in a federal court in Seattle on Tuesday to one count of failure to maintain an effective anti-money-laundering program. 

Magistrate Judge Brian A. Tsuchida questioned Zhao to make sure he understood the plea agreement, saying at one point: “You knew you didn’t have controls in place.” 

“Yes, your honor,” he replied. 

Binance wrote in a statement that it made “misguided decisions” as it quickly grew to become the world’s biggest crypto exchange, and said the settlement acknowledges its “responsibility for historical, criminal compliance violations.” 

U.S. Treasury Secretary Janet Yellen said Binance processed transitions by illicit actors, “supporting activities from child sexual abuse to illegal narcotics, to terrorism, across more than 100,000 transactions.” 

Binance did not file a single suspicious activity report on those transactions, Yellen said, and the company allowed more than 1.5 million virtual currency trades that violated U.S. sanctions, including ones involving Hamas’ al-Qassam Brigades, al-Qaida and other criminals. 

The judge set Zhao’s sentencing for February 23, however it’s likely to be delayed. He faces a possible guideline sentence range of up to 18 months. 

One of his attorneys, Mark Bartlett, noted that Zhao had been aware of the investigation since December 2020, and surrendered willingly even though the United Arab Emirates — where Zhao lives — has no extradition treaty with the U.S. 

“He decided to come here and face the consequences,” Bartlett said. “He’s sitting here. He pled guilty.” 

Zhao, who is married and has young children in the UAE, promised he would return to the U.S. for sentencing if allowed to stay there in the meantime. 

“I want to take responsibility and close this chapter in my life,” Zhao said. “I want to come back. Otherwise I wouldn’t be here today.” 

Company sent investor assets to third party

Zhao previously faced allegations of diverting customer funds, concealing the fact that the company was commingling billions of dollars in investor assets and sending them to a third party that Zhao also owned. 

Over the summer, Binance was accused of operating as an unregistered securities exchange and violating a slew of U.S. securities laws in a lawsuit from regulators. That case was similar to practices uncovered after the collapse of FTX. 

Zhao and Bankman-Fried were originally friendly competitors in the industry, with Binance investing in FTX when Bankman-Fried launched the exchange in 2019. However, the relationship between the two deteriorated, culminating in Zhao announcing he was selling all of his cryptocurrency investments in FTX in early November 2022. FTX filed for bankruptcy a week later. 

At this trial and in later public statements, Bankman-Fried tried cast blame on Binance and Zhao for allegedly orchestrating a run on the bank at FTX. 

A jury found Bankman-Fried guilty of wire fraud and several other charges. He is expected to be sentenced in March, where he could face decades in prison. 
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