Artificial intelligence turns out to be a big fraud: 700 employees release
Artificial intelligence turns out to be a big fraud: 700 employees release
The British Software Start-up Builder.ai, which was once considered a pioneer in the development of AI-controlled software solutions, is at the center of a huge scandal. The company, which is located in London, is currently on the basis of the bankruptcy after serious allegations have been made about its fraudulent practices. Instead of relying on artificial intelligence, most of the works by around 700 employees from India were carried out manually. This reports Vol.at .The unveiling is particularly explosive that the chat bot "Natasha" was not, as claimed, was ki-controlled, but was also operated by humans. As early as 2019, the Wall Street Journal expressed the company's technical performance, but the investments of well -known donors such as Microsoft and Amazon continued to flow despite the existing concerns.
Financial turbulence and massive layoffs
The problems of builder.ai spoke in May 2025 when the financial service provider Viola Credit freely freely freely found around $ 37 million due to sales discrepancies. After internal review, it turned out that the actual income for 2024 was only about $ 50 million, while the company wanted to attract investors with $ 220 million. This drastic difference was generated by round-tripping transactions with the Indian company, between 2021 and 2024, in which invoices were replaced for services that have not been provided. techspot reports that these findings for a comprehensive examination by the US Attorney’s Office and the Sec led to examine possible securities fraud cases.
The situation continued to escalate when the CEO Sachin Dev Duggal resigned in early 2025 and moved abroad. Manpreet took his place, who then announced that around 1,000 employees, mainly in India, had to be released. These layoffs made up about 80 percent of the workforce. Builder.ai's bankruptcy is perceived as the most important bankruptcy of a Ki start-up since the introduction of Chatgpt in 2022 and throws a worrying light on the phenomenon of "AI-Washing" in the technology industry.
A look at the AI market
The current events around Builder.ai come at a time when the use of AI in various industries is increasing rapidly. According to an industry-wide study, AI use in the areas of operations and IT rose by 23 or 26 percent compared to the previous year. In the insurance industry in particular, the operating sector is 90 percent the main area of application for AI. In the banking industry, AI is mainly used in risk management, which also plays a significant role at 59 percent. This shows the potential of AI in the advantages of automation and data analysis, while the human factor in HR processes is still indispensable-here the AI use is only 15 percent, which indicates the need for empathy and personal communication. pwc highlights these trends and emphasizes that the challenges and opportunities in the AI area are equally important.
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