• Arve Hjalmar Holmen, a citizen of Norway, said he asked ChatGPT to tell him what it knows about him, and its response was a horrifying hallucination that claimed he’d murdered his children and gone to jail for the violent act. Given how the AI mixed its false response with real details about his personal life, Holmen filed an official complaint against ChatGPT maker OpenAI.

Have you ever Googled yourself just to see what the internet has to say about you? Well, one man had that same idea with ChatGPT, and now he’s filed a complaint against OpenAI based off what its AI said about him.

Arve Hjalmar Holmen, from Trondheim, Norway, said he asked ChatGPT the question, “Who is Arve Hjalmar Holmen?”, and the response—which we won’t print in full—said he was convicted of murdering his two sons, aged 7 and 10, and sentenced to 21 years in prison as a result. It also said Holmen attempted murder of his third son.

None of these things actually happened, though. ChatGPT appeared to spit out a completely false story it believed was completely true, which is called an AI “hallucination.” 

Based on its response, Holmen filed a complaint against OpenAI with the help of Noyb, a European center for digital rights, which accuses the AI giant of violating the principle of accuracy that’s set forth in the EU’s General Data Protection Regulation (GDPR).

“The complainant was deeply troubled by these outputs, which could have harmful effect in his private life, if they were reproduced or somehow leaked in his community or in his home town,” the complaint said.

What’s dangerous about ChatGPT’s response, according to the complaint, is it blends real elements of Holmen’s personal life with total fabrications. ChatGPT got Holmen’s home town correct, and it was also correct about the number of children—specifically, sons—he has.

JD Harriman, partner at Foundation Law Group LLP in Burbank, Calif., told Fortune that Holmen might have a difficult time proving defamation.

“If I am defending the AI, the first question is ‘should people believe that a statement made by AI is a fact?'” Harriman asked. “There are numerous examples of AI lying.”

Furthermore, the AI didn’t publish or communicate its results to a third party. “If the man forwarded the false AI message to others, then he becomes the publisher and he would have to sue himself,” Harriman said.

Holmen would probably also have a hard time proving the negligence aspect of defamation, since “AI may not qualify as an actor that could commit negligence” compared to people or corporations, Harriman said. Holmen would also have to prove that some harm was caused, like he lost income or business, or experienced pain and suffering. 

Avrohom Gefen, partner at Vishnick McGovern Milizio LLP in New York, told Fortune that defamation cases surrounding AI hallucinations are “untested” in the U.S., but mentioned a pending case in Georgia where a radio host filed a defamation lawsuit that survived OpenAI’s motion to dismiss, so “we may soon get some indication as to how a court will treat these claims.” 

The official complaint asks OpenAI to “delete the defamatory output on the complainant,” tweak its model so it produces accurate results about Holmen, and be fined for its alleged violation of GDPR rules, which compel OpenAI to take “every reasonable” step to ensure personal data is “erased or rectified without delay.”

“With all lawsuits, nothing is automatic or easy,” Harriman told Fortune. “As Ambrose Bierce has said, you go into litigation as a pig and come out as a sausage.”

OpenAI did not immediately respond to Fortune‘s request for comment.

This story was originally featured on Fortune.com

• Elon Musk’s Friday visit to the Pentagon drew criticism and highlighted his companies’ links to both the federal government and China. The billionaire’s rocket company SpaceX has $22 billion in contracts with the federal government. In China, Musk’s Tesla operates its biggest factory, Gigafactory Shanghai, which as of last year produced about half of all Tesla vehicles.

Elon Musk visited the Pentagon Friday for a briefing on China which underscored the billionaire’s steadily growing influence in the Trump administration as well as his businesses’ deep ties to both the federal government and China.

Musk was originally meant to receive a briefing on top-secret information related to a potential war with China, The New York Times reported, although defense officials later said he would receive an unclassified briefing, according to the Wall Street Journal. The Defense Secretary Pete Hegseth and President Trump have both denied that Musk visited the Pentagon to receive top-secret information on a possible war with China, as was reported by the Times prior to Musk’s visit Friday. 

Before reporters in the Oval Office, Trump noted that Musk would not see top-secret information on a potential war with China, and mentioned that the billionaire’s businesses could play a role.

“We don’t want to have a potential war with China, but I can tell you if we did, we’re very well-equipped to handle it, but I don’t want to show that to anybody but certainly you wouldn’t show it to a businessman,” Trump said. “Elon has businesses in China and he would be susceptible perhaps to that.” 

Whatever information he received (he replied “Why should I tell you?” to a reporter’s question about the subject of the meeting), the potential high-level nature of his Pentagon visit has drawn scrutiny.

Sen. Kirsten Gillibrand (D-N.Y.), who is also a senior member of the Senate’s Armed Services Committee, wrote in a post that Musk should not have been at the Pentagon.

“Elon Musk is an unelected, self-interested billionaire with no business anywhere near the Pentagon,” Gillibrand wrote in a post on X.

It’s unclear whether other defense companies would file lawsuits based on Musk’s access, but even if they do it’s doubtful they would prevail in court, said Case Western Reserve University law professor Anat Alon-Beck. 

“Nobody’s promised equal access to that type of information,” Alon-Beck told Fortune. “We’ve always had people—with the previous administrations as well—having access versus others who don’t. So it’s not just about Musk.”

Still, Musk’s businesses have deep ties to China. His EV maker Tesla has been selling vehicles in the country for a decade and Musk has often spoken positively about the country. In 2023, during an audio interview with U.S. lawmakers on his social media network X, the CEO said he was “pro-China.”

“I have some vested interests in China but honestly, I think China is underrated and I think the people of China are really awesome and there’s a lot of positive energy there,” he said at the time.

Among his “vested interests” and involvements with China are the following:

• Tesla’s biggest factory, Gigafactory Shanghai, is located in China. Half of Tesla’s vehicles globally were made there as of last year.
• Despite a recent 49% drop in deliveries, China is still one of Tesla’s biggest markets behind the U.S. 
• The Chinese government has reportedly “sought assurances” that Musk would not sell Starlink in China, the Financial Times reported. Musk last year told companies making Starlink components in Taiwan to move manufacturing to other countries because of “geopolitical concerns.”

In the U.S., SpaceX is a major government contractor with about $22 billion in government contracts, according to its CEO. Its subsidiary, Starlink, helps the Pentagon provide internet access in remote environments. 

Tesla, for its part, has received $11.4 billion in regulatory credits from federal and state governments, according to a Washington Post analysis. Cumulatively, Musk’s companies have received $38 billion worth of government contracts, loans, subsidies, and tax credits going back 20 years, the Post reported.

This story was originally featured on Fortune.com

With Congress just passing the federal budget, lawmakers will have an opportunity to tackle long-term financial challenges outside of crisis mode. One such challenge—and opportunity—is the rise of stablecoins: privately issued digital tokens pegged to fiat currencies like the U.S. dollar. Stablecoins have rapidly grown into a hundreds-of-billions market, facilitating billions in transactions, but they’ve lacked a comprehensive U.S. regulatory framework​. Fortunately, Washington is signaling new openness to digital assets—evidenced by President Trump announcing the establishment of a strategic digital asset reserve for the nation​. Creating the requisite clarity will unlock a new era of competition and innovation among banks.

Stablecoins are a strategic extension of U.S. monetary influence. Around 99% of stablecoin volume today is tied to the U.S. dollar, exporting dollar utility onto international, decentralized blockchain networks. A stablecoin market with the right guardrails can strengthen the U.S. dollar’s dominance in global finance​. If people around the world can easily hold and transact in tokenized dollars, the dollar remains the go-to currency even in a digitizing economy. Recent congressional hearings echo this point—up to $5 trillion in assets could move into stablecoins and digital money by 2030, up from roughly $200 billion now​. If the U.S. fails to act, it risks “becoming the rust belt of the financial industry,” as one fintech CEO warned​. 

Other jurisdictions aren’t standing still: Europe, the U.K., Japan, Singapore, and the UAE are developing stablecoin frameworks​. Some of these could even allow new dollar-pegged tokens issued offshore​—potentially eroding U.S. oversight. In short, America must lead on stablecoins or get pressured by Europe’s Digital Euro and other central bank digital currencies (CBDCs) that threaten both the private banking ecosystem and individual sovereignty in their strictest form. My research, for example, shows that CBDCs to date have not had any positive effects on growing GDP or reducing inflation, but have had negative effects on individuals’ financial well-being.

Ideally, various regulated institutions—banks, trust companies, fintech startups—could issue “tokenized dollars” under a common set of rules. Before the 1900s, state governments had the primary authority over banking. While that led to fragmentation and problems, with the right federal architecture, blockchain allows banks to offer differentiated products and a version of what existed pre-1900—their own type of stablecoin that differs in security, yield, and/or other amenities—while still keeping the value pegged to the dollar. More broadly, there is a large body of academic research showing how stablecoins drive down transaction costs, speed up settlement times, and broaden financial inclusion through new services. 

In absence of federal action, we risk a patchwork of state-by-state rules or even de facto regulation by enforcement, which creates uncertainty for entrepreneurs and consumers alike. The Stablecoin Tethering and Bank Licensing Enforcement (STABLE) Act was introduced in the House in 2020, requiring any company issuing a stablecoin to obtain a bank charter and abide by bank regulations, including approval from the Federal Reserve and FDIC before launching a stablecoin, and to hold FDIC insurance or Federal Reserve deposits as reserves, making stablecoin issuers regulated like banks to protect consumers and the monetary system. 

However, as House Financial Services Committee Chairman French Hill has said, the goal should be to modernize payments and promote financial access without government overreach​. Notably, Hill contrasted private-sector stablecoin innovation with the alternative “competing vision” of a government-run digital dollar (central bank digital currency) that could crowd out private innovation​. And, the STABLE Act could be too draconian, penalizing non-bank entities. To that end, the recent bipartisan effort in the Senate—the Guiding and Establishing National Innovation for U.S. Stablecoins Act of 2025 (GENIUS Act)—has gained momentum.

In practice, the GENUIS Act could allow a regulated fintech or trust company to issue a dollar stablecoin under state supervision, so long as it complies with stringent requirements mirroring federal bank-like rules on liquidity and risk. This kind of flexibility, paired with robust standards, can prevent market fragmentation by bringing all credible stablecoin issuers under a regulatory “big tent.” It would also prevent any single point of failure: If one issuer falters, others operating under the same framework can pick up the slack, keeping the system stable.

Critics often voice concerns that digital currencies could enable illicit activity. But in reality, blockchain technology offers more transparency, not less, when properly leveraged. Every transaction on a public blockchain is recorded on an immutable ledger. Law enforcement has successfully traced and busted criminal networks by following the on-chain trail—something much harder to do with cash stuffed in duffel bags. In fact, blockchain’s decentralized ledger offers the potential for even greater transparency, security, and efficiency​. 

Following the momentum from the White House, Congress has a running start on crafting rules that bring stability and clarity to this market now that the budget has passed. Lawmakers should refine and pass a comprehensive stablecoin bill that incorporates the best of both approaches—the prudential rigor of the bank-centric model and the innovation-friendly flexibility of a dual license system. Done right, stablecoin legislation will reinforce the dollar’s role as the bedrock of global finance in the digital age, unlock new fintech innovation and competition domestically, and enhance financial integrity.

The opinions expressed in Fortune.com commentary pieces are solely the views of their authors and do not necessarily reflect the opinions and beliefs of Fortune.

Read more:

• Elon Musk wants the U.S. Treasury to be on a blockchain. That’s a terrible idea—take it from a big proponent of the technology
• Trump’s crypto reserve is being panned by crypto leaders. Here’s why it’s actually a good idea

This story was originally featured on Fortune.com