[camjw]

Matt Levine has a common refrain which is that basically everything is securities fraud. If you were an investor who invested on the premise that Meta was good at AI and Zuck knowingly put out a bad model, is that securities fraud? Matt Levine will probably argue that it could be in a future edition of Money Stuff (his very good newsletter).

[jjani]

The "everything is securities fraud" meme is really unfortunate, not quite as bad as the "fiduciary duty means execs have to chase short-term profit" myth, but still harmful.

It's only because lying ("puffery") about everything has become the norm in corporate America that indeed, almost all listed companies commit securities fraud. If they'd go back to being honest businessmen, no more securities fraud. Just stop claiming things that aren't true. This is a very real option they could take. If they don't, then they're willingly and knowingly commiting securities fraud. But the meme makes it sound to people as if it's unavoidable, when it's anything but.

[NickC25]

is it securities fraud? sort of.

If Mark, both through Meta and through his own resources, has the capital to hire and retain the best AI researchers / teams, and claims he's doing so, but puts out a model that sucks, he's liable. It's probably not directly fraud, but if he claims he's trying to compete with Google or Microsoft or Apple or whoever, yet doesn't adequately deploy a comparable amount of resources, capital, people, whatever, and doesn't explain why, it could (stretch) be securities fraud....I think.

[genewitch]

And the fine for that? Probably 0.001% of revenue. If that.