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Aaron Greenspan
Firing Sam makes a lot of sense if you sit on the OpenAI Board. Sure, the organization could lose its tax-exempt status, and that would be bad, but the California AG could also sue you for breach of fiduciary duty, or worse, if there's real financial fraud, start filing criminal charges.
This is the kind of risk mitigation strategy intended to reduce a Full Clusterfuck to a Slap On The Wrist.
(And most employees, who are not lawyers, would probably not even be aware of it.) |
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November 18, 2023 at 3:16 PM EST •  Reply |
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Aaron Greenspan
OpenAI's press release reads to me like a letter to the California Attorney General's office:
1. Sam lied to us, the Board, about financial issues. Not our fault.
2. We want to keep our non-profit status.
3. Sam is toast, so we're cool, right?
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November 18, 2023 at 3:02 PM EST • Reply |
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Aaron Greenspan
Firing Sam makes a lot of sense if you sit on the OpenAI Board. Sure, the organization could lose its tax-exempt status, and that would be bad, but the California AG could also sue you for breach of fiduciary duty, or worse, if there's real financial fraud, start filing criminal charges.
This is the kind of risk mitigation strategy intended to reduce a Full Clusterfuck to a Slap On The Wrist.
(And most employees, who are not lawyers, would probably not even be aware of it.) |
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November 18, 2023 at 3:16 PM EST • Reply |
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Aaron Greenspan
But then there's something else. OpenAI, Inc. is a non-profit organization that is required to be, and is, registered with the State of California Office of the Attorney General, which manages tax-exempt organizations. Its exemption was granted on November 15, 2017 at the state level.
You're supposed to file a Form RRF-1 each year four months and 15 days after the end of your accounting period. So if you're on a standard calendar year accounting cycle, that means May 15th. Except that OpenAI has been filing six months late each year since 2018 for some reason.
In 2021, they filed on November 18th. In 2022, they filed on November 17th.
Hey, yesterday was November 17th! How weird!
My theory is that a lawyer got extremely nervous around question 2 on Form RRF-1, which should have been filed yesterday. According to the California AG at least so far, it wasn't.
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November 18, 2023 at 3:00 PM EST • Reply |
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Aaron Greenspan
OpenAI's press release reads to me like a letter to the California Attorney General's office:
1. Sam lied to us, the Board, about financial issues. Not our fault.
2. We want to keep our non-profit status.
3. Sam is toast, so we're cool, right?
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November 18, 2023 at 3:02 PM EST • Reply |
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Aaron Greenspan
Firing Sam makes a lot of sense if you sit on the OpenAI Board. Sure, the organization could lose its tax-exempt status, and that would be bad, but the California AG could also sue you for breach of fiduciary duty, or worse, if there's real financial fraud, start filing criminal charges.
This is the kind of risk mitigation strategy intended to reduce a Full Clusterfuck to a Slap On The Wrist.
(And most employees, who are not lawyers, would probably not even be aware of it.) |
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November 18, 2023 at 3:16 PM EST • Reply |
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Aaron Greenspan
So one thing that has been bugging me about the Big News is that it doesn't make any sense. Company has disagreement with star CEO, decides to part ways. But 30 minutes before the close of trading on a Friday? Sending the NASDAQ down? Surprising Microsoft?!?! Come on. Something is up.
There are only two things that can make a corporate board of directors react suddenly like someone just poked them in the eye: a real threat of criminal penalties or proof of financial fraud.
In this case, if you look beyond the mainstream coverage, there's evidence to suggest both. First, the suggestion of financial issues comes from a pseudonymous user on Reddit.
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November 18, 2023 at 2:59 PM EST • Reply |
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Aaron Greenspan
But then there's something else. OpenAI, Inc. is a non-profit organization that is required to be, and is, registered with the State of California Office of the Attorney General, which manages tax-exempt organizations. Its exemption was granted on November 15, 2017 at the state level.
You're supposed to file a Form RRF-1 each year four months and 15 days after the end of your accounting period. So if you're on a standard calendar year accounting cycle, that means May 15th. Except that OpenAI has been filing six months late each year since 2018 for some reason.
In 2021, they filed on November 18th. In 2022, they filed on November 17th.
Hey, yesterday was November 17th! How weird!
My theory is that a lawyer got extremely nervous around question 2 on Form RRF-1, which should have been filed yesterday. According to the California AG at least so far, it wasn't.
|
|
November 18, 2023 at 3:00 PM EST • Reply |
|
Aaron Greenspan
OpenAI's press release reads to me like a letter to the California Attorney General's office:
1. Sam lied to us, the Board, about financial issues. Not our fault.
2. We want to keep our non-profit status.
3. Sam is toast, so we're cool, right?
|
|
November 18, 2023 at 3:02 PM EST • Reply |
|
Aaron Greenspan
Firing Sam makes a lot of sense if you sit on the OpenAI Board. Sure, the organization could lose its tax-exempt status, and that would be bad, but the California AG could also sue you for breach of fiduciary duty, or worse, if there's real financial fraud, start filing criminal charges.
This is the kind of risk mitigation strategy intended to reduce a Full Clusterfuck to a Slap On The Wrist.
(And most employees, who are not lawyers, would probably not even be aware of it.) |
|
November 18, 2023 at 3:16 PM EST • Reply |
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