Allegation: Indian programmers were behind AI chatbot

The AI start-up builder.ai was supposed to be worth 1.5 billion US dollars – What remains is a shambles after the company announced last week via LinkedIn that it had filed for insolvency. The London-based company is facing massive allegations: In addition to sham deals, the company's core discipline is being called into question. Instead of the AI programming aid Natasha, 700 programmers in India are said to have programmed customer orders.

Builder.ai merely announced that an insolvency administrator had been appointed for the parent company Engineer.ai. Despite "tireless efforts by our current team and exploration of all possible options", the company has not been able to recover from "historical challenges and past decisions that have significantly impacted its financial position", it said cryptically.

Reports of sham transactions

The US financial news agency Bloomberg recently reported, citing unnamed sources, that the AI start-up had allegedly engaged in sham transactions with the Indian social media company VerSe Innovation for years. Between 2021 and 2024, the two companies had billed each other similar amounts - a process known as "round-tripping" to artificially increase sales.

Builder.ai had exaggerated its revenue forecasts for the year by 300 percent as a result. The company finally went bankrupt when creditors had funds seized. According to the report, US authorities are also demanding financial documents and investigating. The start-up's investors include prominent names such as Microsoft and Qatar. Umang Bedi, co-founder of VerSe, denied the allegations to Bloomberg.

Is it all fake?

In addition to the financial accusations, there are now reports that the AI programming kit, which is supposed to work without any knowledge of the customer's code, was just a sham. Programmers in India are actually doing the work. This was reported by the Indian newspaper "Times of India", among others. This accusation is not new. Back in 2019, the Wall Street Journal questioned whether Engineer.ai could actually create mobile apps automatically using AI. The new information is said to come from financial industry circles.

(mki)