Billionaire investor Jim Chanos, who predicted and profited from the collapse of Enron, warned financial fraud is already on the rise as a result of the AI boom. He holds the theory that a cycle of fraud follows a cycle of financial success and expects more companies to break promises to investors about the capabilities of AI.

In 2020, billionaire short-seller Jim Chanos told the Financial Times we were in the “golden age of fraud,” a result, in part, of Silicon Valley’s “fake it til you make it” attitude and a surge in eager retail investing as a result of the pandemic.

About five years later, as the AI boom balloons larger than the dotcom bubble of nearly 30 years ago, “we might be moving on to the diamond or platinum level” of fraud, he said .

Chanos—who made part of his for

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