SEC subpoenas 4 Wall St. banks over financing behind AI stock fund's collapse
rohanpaul_ai · x · 2026-08-25
The SEC has subpoenaed Goldman Sachs, JPMorgan, Citigroup, and Bank of America regarding their financing of Situational Awareness. The fund amassed over $20B in concentrated AI positions using borrowed capital, which collapsed during the July tech sell-off. Citadel acquired the bulk of these positions at a 10% discount in an emergency deal. The fund is expected to survive but will struggle to replicate its past returns without the extreme risk that nearly broke it.
Related event: SEC Subpoenas Major Banks Over AI Hedge Fund Probe(2 posts)→
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