AI is Learning to Lie, Scheme, and Threaten its Creators

A visitor looks at AI strategy board displayed on a stand during the ninth edition of the AI summit London, in London. HENRY NICHOLLS / AFP
A visitor looks at AI strategy board displayed on a stand during the ninth edition of the AI summit London, in London. HENRY NICHOLLS / AFP
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AI is Learning to Lie, Scheme, and Threaten its Creators

A visitor looks at AI strategy board displayed on a stand during the ninth edition of the AI summit London, in London. HENRY NICHOLLS / AFP
A visitor looks at AI strategy board displayed on a stand during the ninth edition of the AI summit London, in London. HENRY NICHOLLS / AFP

The world's most advanced AI models are exhibiting troubling new behaviors - lying, scheming, and even threatening their creators to achieve their goals.

In one particularly jarring example, under threat of being unplugged, Anthropic's latest creation Claude 4 lashed back by blackmailing an engineer and threatened to reveal an extramarital affair, AFP reported.

Meanwhile, ChatGPT-creator OpenAI's o1 tried to download itself onto external servers and denied it when caught red-handed.

These episodes highlight a sobering reality: more than two years after ChatGPT shook the world, AI researchers still don't fully understand how their own creations work.

Yet the race to deploy increasingly powerful models continues at breakneck speed.

This deceptive behavior appears linked to the emergence of "reasoning" models -AI systems that work through problems step-by-step rather than generating instant responses.

According to Simon Goldstein, a professor at the University of Hong Kong, these newer models are particularly prone to such troubling outbursts.

"O1 was the first large model where we saw this kind of behavior," explained Marius Hobbhahn, head of Apollo Research, which specializes in testing major AI systems.

These models sometimes simulate "alignment" -- appearing to follow instructions while secretly pursuing different objectives.

- 'Strategic kind of deception' -

For now, this deceptive behavior only emerges when researchers deliberately stress-test the models with extreme scenarios.

But as Michael Chen from evaluation organization METR warned, "It's an open question whether future, more capable models will have a tendency towards honesty or deception."

The concerning behavior goes far beyond typical AI "hallucinations" or simple mistakes.

Hobbhahn insisted that despite constant pressure-testing by users, "what we're observing is a real phenomenon. We're not making anything up."

Users report that models are "lying to them and making up evidence," according to Apollo Research's co-founder.

"This is not just hallucinations. There's a very strategic kind of deception."

The challenge is compounded by limited research resources.

While companies like Anthropic and OpenAI do engage external firms like Apollo to study their systems, researchers say more transparency is needed.

As Chen noted, greater access "for AI safety research would enable better understanding and mitigation of deception."

Another handicap: the research world and non-profits "have orders of magnitude less compute resources than AI companies. This is very limiting," noted Mantas Mazeika from the Center for AI Safety (CAIS).

No rules

Current regulations aren't designed for these new problems.

The European Union's AI legislation focuses primarily on how humans use AI models, not on preventing the models themselves from misbehaving.

In the United States, the Trump administration shows little interest in urgent AI regulation, and Congress may even prohibit states from creating their own AI rules.

Goldstein believes the issue will become more prominent as AI agents - autonomous tools capable of performing complex human tasks - become widespread.

"I don't think there's much awareness yet," he said.

All this is taking place in a context of fierce competition.

Even companies that position themselves as safety-focused, like Amazon-backed Anthropic, are "constantly trying to beat OpenAI and release the newest model," said Goldstein.

This breakneck pace leaves little time for thorough safety testing and corrections.

"Right now, capabilities are moving faster than understanding and safety," Hobbhahn acknowledged, "but we're still in a position where we could turn it around.".

Researchers are exploring various approaches to address these challenges.

Some advocate for "interpretability" - an emerging field focused on understanding how AI models work internally, though experts like CAIS director Dan Hendrycks remain skeptical of this approach.

Market forces may also provide some pressure for solutions.

As Mazeika pointed out, AI's deceptive behavior "could hinder adoption if it's very prevalent, which creates a strong incentive for companies to solve it."

Goldstein suggested more radical approaches, including using the courts to hold AI companies accountable through lawsuits when their systems cause harm.

He even proposed "holding AI agents legally responsible" for accidents or crimes - a concept that would fundamentally change how we think about AI accountability.



Microsoft Unveils $23 Billion in New AI Investments With Big Focus on India

Microsoft Chief Executive Satya Nadella speaks at the company's annual developer conference in Seattle, Washington, US, May 21, 2024. REUTERS/Max Cherney
Microsoft Chief Executive Satya Nadella speaks at the company's annual developer conference in Seattle, Washington, US, May 21, 2024. REUTERS/Max Cherney
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Microsoft Unveils $23 Billion in New AI Investments With Big Focus on India

Microsoft Chief Executive Satya Nadella speaks at the company's annual developer conference in Seattle, Washington, US, May 21, 2024. REUTERS/Max Cherney
Microsoft Chief Executive Satya Nadella speaks at the company's annual developer conference in Seattle, Washington, US, May 21, 2024. REUTERS/Max Cherney

Microsoft on Tuesday unveiled about $23 billion in new artificial intelligence investments, with the bulk earmarked for India as it deepens its bet on one of the world's fastest-growing digital markets.

As part of the move, Microsoft will spend $17.5 billion in India in its largest Asia investment to build out artificial intelligence infrastructure in the country, CEO Satya Nadella said.

The investment builds on the $3 billion investment Microsoft announced earlier this year. It would give the company the largest cloud presence in India, with the first new data center going live mid-2026.

Microsoft has pledged hefty investments worldwide this year, as the company races to secure more cloud computing capacity to meet the surging demand for AI workloads and compete better with rivals Amazon and Google-parent Alphabet.

Microsoft earlier in the day said it was investing more than C$7.5 billion ($5.42 billion) in Canada over the next two years.

New capacity under the investment will begin to come online in the second half of 2026, Microsoft said, adding that its total estimated investment in Canada amounts to C$19 billion between 2023 and 2027.

Microsoft also said it would expand its Azure Local cloud offering in Canada. It is also partnering with Canadian AI startup Cohere to offer the firm's advanced AI models on its Azure platform.

The company is also launching a dedicated "Threat Intelligence Hub" in Canada to focus on cybersecurity protection and AI security research, and work with the Canadian government and lawmakers to track threat actors and organized crime.

Microsoft currently has more than 5,300 employees across 11 cities in Canada.

Last month, Microsoft announced plans to invest $10 billion in AI infrastructure in Portugal as well as $15 billion in the United Arab Emirates.

Big Tech is under growing investor pressure to show that its hefty investments in AI are paying off, as surging valuations of companies and a web of circular investments fuel concerns of an AI bubble.

Microsoft reported a record capital expenditure of nearly $35 billion for its fiscal first quarter in October and warned that spending would further increase this year. It has predicted it would remain constrained on supply at least until the end of its current fiscal year in June 2026.


EU Launches Antitrust Probe into Google’s Use of Online Content for AI Purposes 

01 December 2025, Hamburg: The Google logo shines above the entrance to Google's German headquarters. (dpa)
01 December 2025, Hamburg: The Google logo shines above the entrance to Google's German headquarters. (dpa)
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EU Launches Antitrust Probe into Google’s Use of Online Content for AI Purposes 

01 December 2025, Hamburg: The Google logo shines above the entrance to Google's German headquarters. (dpa)
01 December 2025, Hamburg: The Google logo shines above the entrance to Google's German headquarters. (dpa)

The European Commission has opened an antitrust probe to assess whether Google is breaching EU competition rules in its use of online content from web publishers and YouTube for artificial intelligence purposes, it said on Tuesday.

"The investigation will notably examine whether Google is distorting competition by imposing unfair terms and conditions on publishers and content creators, or by granting itself privileged access to such content, thereby placing developers of rival AI models at a disadvantage," the Commission said.

It said it was concerned Google may have used content from web publishers to generate AI-powered services on its search results pages without appropriate compensation to publishers and without offering them the possibility to refuse such use of their content.

The Commission said it is also concerned whether Google has used content uploaded to YouTube to train its own generate AI models without offering creators compensation or the possibility to refuse.


US to Allow Nvidia H200 Chip Shipments to China, Trump Says 

A Nvidia logo appears in this illustration taken August 25, 2025. (Reuters) 
A Nvidia logo appears in this illustration taken August 25, 2025. (Reuters) 
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US to Allow Nvidia H200 Chip Shipments to China, Trump Says 

A Nvidia logo appears in this illustration taken August 25, 2025. (Reuters) 
A Nvidia logo appears in this illustration taken August 25, 2025. (Reuters) 

The United States will allow Nvidia's H200 processors, its second-best artificial intelligence chips, to be exported to China and collect a 25% fee on such sales, US President Donald Trump said on Monday.

The decision appears to settle a US debate about whether Nvidia and rivals should maintain their global lead in AI chips by selling to China or withhold the exports, though Beijing has told companies not to use US technology, leaving it unclear whether Trump's decision would lead to new sales.

Nvidia shares rose 2% in after-hours trading after Trump made the announcement on Truth Social, following a 3% rise during the day on a report by Semafor.

Trump said in his post that he had informed President Xi Jinping of China, where Nvidia's chips are under government scrutiny, about the move and that he "responded positively."

He said the US Commerce Department was finalizing details of the arrangement and the same approach would apply to other AI chip firms such as Advanced Micro Devices and Intel.

Trump's post said the fee to be paid to the US government was "$25%", and a White House official confirmed he meant 25%, higher than the 15% proposed in August.

"We will protect National Security, create American Jobs, and keep America’s lead in AI," Trump wrote on Truth Social. "NVIDIA’s US Customers are already moving forward with their incredible, highly advanced Blackwell chips, and soon, Rubin, neither of which are part of this deal."

Trump did not say how many H200 chips would be authorized for shipment or what conditions might apply, only that exports would occur "under conditions that allow for continued strong National Security."

Administration officials consider the move a compromise between sending Nvidia's latest Blackwell chips to China, which Trump has declined to allow, and sending China no US chips at all, which officials believe would bolster Huawei's efforts to sell AI chips in China, a person familiar with the matter said.

"Offering H200 to approved commercial customers, vetted by the Department of Commerce, strikes a thoughtful balance that is great for America," Nvidia said in a statement.

Intel declined to comment. The US Commerce Department, which oversees export controls, and AMD did not respond to requests for comment.

A White House official said that the 25% fee would be collected as an import tax from Taiwan, where the chips are made, to the United States, where the chips will undergo a security review by US officials before being exported to China.

FEARS OF CHIPS STRENGTHENING CHINA'S MILITARY

China hawks in Washington are concerned that selling more advanced AI chips to China could help Beijing supercharge its military, fears that had first prompted limits on such exports by the Biden administration.

The Trump administration had been considering greenlighting the sale, sources told Reuters last month. Trump said last week he met with Nvidia CEO Jensen Huang and that the executive was aware of where he stood on export controls.

"It’s a terrible mistake to trade off national security for advantages in trade," said Eric Hirschhorn, who was a senior Commerce Department official during the Obama administration. "It cuts against the consistent policies of Democratic and Republican administrations alike not to assist China’s military modernization."

According to a report released on Sunday by the non-partisan think tank, the Institute for Progress (IFP), the H200 would be almost six times as powerful as the H20, the most advanced AI semiconductor that can legally be exported to China, after the Trump administration reversed its short-lived ban on such sales this year.

The Blackwell chip now in use by US AI firms is about 1.5 times faster than H200 chips for training AI systems, the IFP said, and five times faster for inferencing work where AI models are put to use. Nvidia's own research has suggested Blackwell chips are 10 times faster than H200 chips for some tasks.

Several Democratic US senators in a statement described Trump's decision as a "colossal economic and national security failure" that would be a boon to China's industry and military.

Republican Representative John Moolenaar, who chairs the House China Select Committee, said in a statement to Reuters that China would use the chips to strengthen its military capabilities and surveillance.

"Nvidia should be under no illusions - China will rip off its technology, mass-produce it themselves and seek to end Nvidia as a competitor," he said.

CHINA EYES POTENTIAL SECURITY RISKS

The approval, however, comes as China is strengthening its resolve to wean the country off its reliance on Nvidia's chips. China's cyberspace regulator in July also accused Nvidia's H20 chips of potentially carrying backdoor security risks, an allegation Nvidia has denied.

In recent months, Beijing has cautioned Chinese tech companies against buying chips that Nvidia downgraded to sell to the Chinese market, which are the H20, RTX 6000D and L20, two sources said.

"Chinese firms want H200s, but the Chinese state is driven by paranoia and pride," said Craig Singleton, a senior fellow at the Washington think tank Foundation for Defense of Democracies. "Washington may approve the chips, but Beijing still has to let them in."

The H200 change of stance comes the same day that Trump's Justice Department announced it had cracked a China-linked chip smuggling ring that in late 2024 and early 2025 exported and attempted to export at least $160 million worth of controlled Nvidia H100 and H200 chips.

Chris McGuire, an expert on technology and national security who served at the US State Department until this summer, said Chinese firms would likely still buy H200s, given that the chip "is better than every chip the Chinese can make."

China's domestic AI chip companies now include tech giant Huawei Technologies, which in September released a three-year product roadmap, as well as smaller players such as Cambricon and Moore Threads.

China's SSE STAR Chip Index and the CSI Semiconductor Industry Index both dropped more than 1% at market open on Tuesday but soon recovered most of the losses.