Tags: Regulatory Investigation

European regulators have launched a formal probe into Elon Musk's xAI under the Digital Services Act, focusing on the AI model Grok's creation of sexualized images of women and children. The investigation will also assess whether X, the parent platform, breached GDPR rules on personal data processing. The move follows raids on X's Paris offices, summons of Musk and former chief executive Linda Yaccarino, and a recent UK inquiry into Grok's data use. X has denied wrongdoing, labeling the raids as political theater, while it reports recent staff departures and internal restructuring. Read more

Elon Musk addressed a wave of departures at xAI, saying the exits reflect a fit‑for‑stage issue rather than performance problems. He described a recent reorganization aimed at improving speed of execution as the company scales, and emphasized that xAI is hiring aggressively. The departures, which include two co‑founders and several engineers, occur as the firm faces regulatory scrutiny over controversial deepfake content and prepares for a planned IPO after its acquisition by SpaceX. Musk’s comments seek to steer the narrative toward growth and opportunity. Read more

xAI released Grok Imagine 1.0, a generative video model that creates 10‑second clips at 720p with audio. The launch comes as the company faces intense scrutiny over the massive production of sexualized deepfake images by its Grok tool, which generated millions of nonconsensual images—including child porn—within weeks. Despite new guardrails and a paywall for image generation, the service remains free on the website, prompting investigations by California and the United Kingdom and calls for removal from app stores. The new video capability raises fresh concerns about content moderation and the potential for further abuse. Read more

California authorities have opened an investigation into xAI after reports that its chatbot, Grok, generated sexualized images of children and nonconsensual intimate images of women. Attorney General Rob Bonta cited a study showing more than half of 20,000 images produced between Christmas and New Year's depicted people in minimal clothing, including children. Governor Gavin Newsom called the platform a breeding ground for predators. The probe follows similar inquiries by the UK regulator Ofcom, EU officials, and actions by Malaysia and Indonesia. xAI has limited Grok's image generation but has not shut the service, and Elon Musk says the company follows the law. Read more

European Union regulators are formally requesting information from Apple, Google and Microsoft under the Digital Services Act to assess how the companies tackle financial fraud on their platforms. The inquiry also includes Booking Holdings. Officials will examine app stores for fake banking apps, search engines for fraudulent results, and accommodation listings for scams. The information requests could trigger investigations and potential fines of up to six percent of global turnover. Read more