Published in AI

Eric Schmidt not in hot water about AI investment

by on25 October 2022

Schmidt not going to hit the fan at the National Security Commission on Artificial Intelligence committee

Former Google CEO Eric Schmidt might have made a dodgy investment in an AI company after he was appointed to the National Security Commission on Artificial Intelligence, but it appears he never did anything wrong.

Congress asked Schmidt to advise the US government on how to advance the development of artificial intelligence, machine learning and other technologies to enhance the national security.

Schmidt wrote proposed legislation that later became law and steered billions of dollars of taxpayer funds to the AI industry which was given a new life.

Five months after his appointment, Schmidt made a little-noticed private investment in an initial seed round of financing for a startup company called Beacon, which uses AI in the company's supply chain products for shippers who manage freight logistics.

A CNBC investigation said that there is no indication that Schmidt broke any ethics rules or did anything unlawful while chairing the commission, but it would appear that he was making direct investments in AI startup companies during his tenure as chairman of the AI commission.

CNBC said that venture capital firms financed, in part, by Schmidt and his private family foundation made dozens of additional investments in AI companies during Schmidt's tenure, giving Schmidt an economic stake in the industry even as he developed new regulations and encouraged taxpayer financing for it.

"Altogether, Schmidt and entities connected to him made more than 50 investments in AI companies while he was chairman of the federal ommission on AI. Information on his investments isn't publicly available."

This meant that while Schmidt was wielding enormous influence over the future of federal AI policy, he was also potentially positioning himself to profit personally from the most promising young AI companies

Schmidt disclosed his investments in a private filing to the US government at the time and the public and news media had no access to that document. He is quick to point out that he followed all rules and procedures in his tenure on the commission.

We guess it was just that no one thought that it was not quite right to invest in companies you were directing government money towards to build up. 


Last modified on 25 October 2022
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