In another episode of “fake it till you make it,” where young adults trying to be rich too quick finds themselves in jail, we’ll see Albert Saniger.
It’s always been joked that Artificial Intelligence (AI) powered apps use real people from a third-world Asian country — this time, it’s true.
What’s supposed to be a story about AI breakthroughs just so happened to be human intelligence, after all, operated in our backyards.
Saniger, the former CEO of Nate, was charged with defrauding its investors after the US Department of Justice discovered that his supposed AI-powered shopping app was powered by hundreds of call center employees in the Philippines.
“As alleged, Albert Saniger misled investors by exploiting the promise and allure of AI technology to build a false narrative about innovation that never existed. This type of deception not only victimizes innocent investors, it diverts capital from legitimate startups, makes investors skeptical of real breakthroughs, and ultimately impedes the progress of AI development,” said Acting US Attorney for the South District of New York Matthew Podolsky.
The 35-year-old from Barcelona, Spain, founded Nate in 2018 and has raised more than $40 million from multiple investors for the app’s AI development and deployment. According to its website, Nate is the world’s only universal shopping app, where you can “stay in flow, while nate does the checkout.” It was supposed to reduce the checkout process to a “single tap.”
Its page says, “nate uses AI to navigate websites the way humans do, so you never have to checkout again. Let machines do the heavy lifting.” However, the reality is no machine was doing any lifting, but Filipino workers were processing transactions on the back end, similar to purchasing assistants.
Saniger has been charged with one count of securities fraud and one count of wire fraud, each with a maximum sentence of 20 years in prison for each count, bringing a maximum jail time of up to 40 years.
However, the indictment also mentioned that the maximum potential sentences in this case are only for informational purposes, as the judge will determine the actual sentencing.
“Albert Saniger allegedly defrauded investors with fabrications of his company’s purported artificial intelligence capabilities while covertly employing personnel to satisfy the illusion of technological automation,” said FBI Assistant Director in Charge Christopher G Raia.
If this sounds familiar, it’s because Amazon also once faced a similar issue with Amazon Fresh “Just Walk Out” AI revolution, which was supposed to be an automatic AI-driven checkout, but was reported to be human-powered by about 1,000 people in India.