Shares of Tesla (TSLA, Financial) fell nearly 1% after Reuters reported that Elon Musk's Department of Government Efficiency—nicknamed “DOGE”—has begun using a customized version of its Grok chatbot across multiple federal departments, including Homeland Security, without formal agency approval.
Three people familiar with the matter told Reuters the aim is to sift data and auto-generate reports, with Grok launched by Musk's xAI in 2023. Analysts warn this unvetted deployment may breach long-standing privacy safeguards and give Musk unfair access to nonpublic federal contracting information.
Two of the sources said DOGE staff pushed DHS officials to adopt Grok, even though it hasn't been vetted; it's unclear what specific datasets have been fed into the system. Privacy advocates say mixing public-sector data with a private AI tool risks regulatory pushback and reputational damage.
On a side note, Anthropic has launched its next-generation Claude models—Claude Opus 4 and Claude Sonnet 4—backed by Amazon (AMZN, Financial) and Alphabet (GOOG, Financial), touting Opus 4 as the world's top coding model and Sonnet 4 for advanced reasoning and tool use, with Claude Code now widely available.)
Why It Matters: Investors should watch for regulatory scrutiny and potential legal fallout as Musk blurs lines between public service and private AI ventures.
