Stock Markets

US prosecutors see rising threat of AI-generated child sex abuse imagery

Published

1 month ago

October 20, 2024

(This Oct. 17 story has been refiled to change James Silver’s title to deputy chief in paragraph 3)

By Andrew Goudsward

WASHINGTON (Reuters) – U.S. federal prosecutors are stepping up their pursuit of suspects who use artificial intelligence tools to manipulate or create child sex abuse images, as law enforcement fears the technology could spur a flood of illicit material.

The U.S. Justice Department has brought two criminal cases this year against defendants accused of using generative AI systems, which create text or images in response to user prompts, to produce explicit images of children.

“There’s more to come,” said James Silver, the deputy chief of the Justice Department’s Computer Crime and Intellectual Property Section, predicting further similar cases.

“What we’re concerned about is the normalization of this,” Silver said in an interview. “AI makes it easier to generate these kinds of images, and the more that are out there, the more normalized this becomes. That’s something that we really want to stymie and get in front of.”

The rise of generative AI has sparked concerns at the Justice Department that the rapidly advancing technology will be used to carry out cyberattacks, boost the sophistication of cryptocurrency scammers and undermine election security.

Child sex abuse cases mark some of the first times that prosecutors are trying to apply existing U.S. laws to alleged crimes involving AI, and even successful convictions could face appeals as courts weigh how the new technology may alter the legal landscape around child exploitation.

Prosecutors and child safety advocates say generative AI systems can allow offenders to morph and sexualize ordinary photos of children and warn that a proliferation of AI-produced material will make it harder for law enforcement to identify and locate real victims of abuse.

The National Center for Missing and Exploited Children, a nonprofit group that collects tips about online child exploitation, receives an average of about 450 reports each month related to generative AI, according to Yiota Souras, the group’s chief legal officer.

That’s a fraction of the average of 3 million monthly reports of overall online child exploitation the group received last year.

UNTESTED GROUND

Cases involving AI-generated sex abuse imagery are likely to tread new legal ground, particularly when an identifiable child is not depicted.

Silver said in those instances, prosecutors in the Justice Department’s child exploitation section can charge obscenity offenses when child pornography laws do not apply.

Prosecutors indicted Steven Anderegg, a software engineer from Wisconsin, in May on charges including transferring obscene material. Anderegg is accused of using Stable Diffusion, a popular text-to-image AI model, to generate images of young children engaged in sexually explicit conduct and sharing some of those images with a 15-year-old boy, according to court documents.

Anderegg has pleaded not guilty and is seeking to dismiss the charges by arguing that they violate his rights under the U.S. Constitution, court documents show.

He has been released from custody while awaiting trial. His attorney was not available for comment.

Stability AI, the maker of Stable Diffusion, said the case involved a version of the AI model that was released before the company took over the development of Stable Diffusion. The company said it has made investments to prevent “the misuse of AI for the production of harmful content.”

Federal prosecutors also charged a U.S. Army soldier with child pornography offenses in part for allegedly using AI chatbots to morph innocent photos of children he knew to generate violent sexual abuse imagery, court documents show.

The defendant, Seth Herrera, pleaded not guilty and has been ordered held in jail to await trial. Herrera’s lawyer did not respond to a request for comment.

Legal experts said that while sexually explicit depictions of actual children are covered under child pornography laws, the landscape around obscenity and purely AI-generated imagery is less clear.

The U.S. Supreme Court in 2002 struck down as unconstitutional a federal law that criminalized any depiction, including computer-generated imagery, appearing to show minors engaged in sexual activity.

“These prosecutions will be hard if the government is relying on the moral repulsiveness alone to carry the day,” said Jane Bambauer, a law professor at the University of Florida who studies AI and its impact on privacy and law enforcement.

Federal prosecutors have secured convictions in recent years against defendants who possessed sexually explicit images of children that also qualified as obscene under the law.

Advocates are also focusing on preventing AI systems from generating abusive material.

Two nonprofit advocacy groups, Thorn and All Tech Is Human, secured commitments in April from some of the largest players in AI including Alphabet’s (NASDAQ:) Google, Amazon.com (NASDAQ:), Facebook and Instagram parent Meta Platforms (NASDAQ:), OpenAI and Stability AI to avoid training their models on child sex abuse imagery and to monitor their platforms to prevent its creation and spread.

“I don’t want to paint this as a future problem, because it’s not. It’s happening now,” said Rebecca Portnoff, Thorn’s vice president of data science.

“As far as whether it’s a future problem that will get completely out of control, I still have hope that we can act in this window of opportunity to prevent that.”

Stock Markets

Needham initiates coverage on On Holding with buy rating

Published

17 hours ago

November 23, 2024

Investing.com — Needham on Friday initiated its coverage on On Holding AG (NYSE:) with a “buy” rating and a target price of $64.

Brokerage said On has shown industry-leading growth, with impressive revenue increases and healthy margin expansion. The company is likely to keep growing as it increases brand awareness and gains space with top sneaker retailers worldwide.

“We believe the company has a continued runway for strong growth, as they increase brand awareness and gain shelf space with the biggest and best sneaker retailers in the world,” analyst Tom Nikic wrote in the note.

Needham analyst noted that Roger Federer-backed On was valued at 5 times its expected 2025 revenues, which make stock may seem expensive but strong fundamentals could support continued stock momentum.

“Although valuation metrics are lofty, we believe the shares can continue to exhibit momentum as long as fundamentals”

ON is the fastest growing company in Needham’s coverage, with expected 32% revenue growth in 2024. Its Direct-to-Consumer (DTC) growing 43% year-to-date, compared to 24% growth for wholesale sales.

Brokerage highlighted despite this growth, the brand’s awareness is still relatively low. In major markets like the U.S., U.K., France, and Australia, awareness was under 10% a year ago. However, it’s increasing rapidly, with U.S. awareness doubling to around 20%, and tripling in France.

Stock Markets

Toll Brothers Announces Final Opportunity at Verona Estates Community in Chatsworth, California

Published

17 hours ago

November 23, 2024

CHATSWORTH, Calif., Nov. 22, 2024 (GLOBE NEWSWIRE) — Toll Brothers , Inc. (NYSE:), the nation’s leading builder of luxury homes, today announced the final opportunity to own a new home at Verona Estates, an exclusive gated community in Chatsworth, California. Only a few homes remain available for sale in this prestigious community, including the professionally decorated Siena Modern Farmhouse model home.

The intimate gated enclave of Verona Estates is a rare find showcasing award-winning architecture and innovative home designs. Nestled in an established Chatsworth neighborhood south of the Santa Susana Mountains and adjacent to the Vineyards at Porter Ranch, this exceptional community offers a serene and relaxed atmosphere with the convenience of nearby shopping and easy access to freeways, entertainment, and recreation.

Toll Brothers residents in Verona Estates will enjoy distinctive architecture, quality craftsmanship, luxurious home designs with open floor plans, expansive home sites, and proximity to the future 50-acre Porter Ranch community park. Verona Estates offers generous two-story home designs ranging from 4,700 to 6,000+ square feet, with 5 to 6 bedrooms, 4.5 to 6.5 bathrooms, and 3-car garages. The homes also feature popular floor plan options including prep kitchens, guest suites, floating staircases, indoor and outdoor fireplaces, and more. Move-in ready homes in the community are priced from $1,979,995.

We are thrilled to offer the final opportunity to own a home in the exclusive Verona Estates community, said Nick Norvilas, Division President of Toll Brothers in Los Angeles. The Siena model home is a showcase of luxury and design, and we encourage interested home buyers to visit and experience this exceptional home along with the final few quick move-in homes remaining in the community firsthand.

The Siena Modern Farmhouse model home features designer upgrades throughout, including fully landscaped and furnished interiors, offering an unparalleled living experience. The professionally decorated model home is priced at $2,999,995.

For more information, call 844-700-8655 or visit TollBrothers.com/LA. The Sales Center for Verona Estates is located at 20508 Edgewood Court in Chatsworth and is open by appointment only.

About Toll Brothers

Toll Brothers, Inc., a Fortune 500 Company, is the nation’s leading builder of luxury homes. The Company was founded 57 years ago in 1967 and became a public company in 1986. Its common stock is listed on the New York Stock Exchange under the symbol TOL. The Company serves first-time, move-up, empty-nester, active-adult, and second-home buyers, as well as urban and suburban renters. Toll Brothers builds in over 60 markets in 24 states: Arizona, California, Colorado, Connecticut, Delaware, Florida, Georgia, Idaho, Indiana, Maryland, Massachusetts, Michigan, Nevada, New Jersey, New York, North Carolina, Oregon, Pennsylvania, South Carolina, Tennessee, Texas, Utah, Virginia, and Washington, as well as in the District of Columbia. The Company operates its own architectural, engineering, mortgage, title, land development, smart home technology, and landscape subsidiaries. The Company also develops master-planned and golf course communities as well as operates its own lumber distribution, house component assembly, and manufacturing operations.

In 2024, Toll Brothers marked 10 years in a row being named to the Fortune World’s Most Admired Companies™ list and the Company’s Chairman and CEO Douglas C. Yearley, Jr. was named one of 25 Top CEOs by Barron’s magazine. Toll Brothers has also been named Builder of the Year by Builder magazine and is the first two-time recipient of Builder of the Year from Professional Builder magazine. For more information visit TollBrothers.com.

Contact: Andrea Meck | Toll Brothers, Director, Public Relations & Social Media | 215-938-8169 | ameck@tollbrothers.com

A photo accompanying this announcement is available at https://www.globenewswire.com/NewsRoom/AttachmentNg/cbb8cf4a-a018-4df0-955e-3cf4ab63edeb

Sent by Toll Brothers via Regional Globe Newswire (TOLL-REG)

Verona Estates by Toll Brothers

Toll Brothers announced the final opportunity to own a new home at Verona Estates, including the designer-decorated Siena model home, in Chatsworth, California.

Source: Toll Brothers, Inc.

Stock Markets

Northvolt crisis may be make or break for Europe’s EV battery ambitions

Published

17 hours ago

November 23, 2024

By Marie Mannes, Alessandro Parodi and Stine Jacobsen

STOCKHOLM/GDANSK (Reuters) – Northvolt’s financial collapse deals a blow to Europe’s plan to set up its own battery industry to power electric cars, stirring a debate about whether it needs to do more to attract investment as startups struggle to catch up with Chinese rivals.

Europe’s biggest hope for an electric vehicle battery champion filed for U.S. Chapter 11 bankruptcy protection on Thursday after talks with investors and creditors including Volkswagen (ETR:) and Goldman Sachs for funding failed.

The Swedish company, whose motto is “make oil history”, has received more than $10 billion in equity, debt and public financing since its 2016 start-up. Volkswagen and Goldman Sachs each own about one fifth of its shares.

Northvolt said on Friday it needed $1.0-$1.2 billion in new funds under the restructuring process, which it hopes will end by the end of March.

In recent months, it has shrunk the business and cut jobs in a bid to shore up its finances. But it has struggled to produce sufficient volumes of high-quality batteries, and lost a 2 billion euro ($2.1 billion) contract from BMW (ETR:) in June.

That has left Europe’s ambitions to build its own battery industry looking a distant dream.

In recent years, Northvolt led a wave of European startups investing tens of billions of dollars to serve the continent’s automakers as they switch from internal combustion engines to electric vehicles.

But growth in EV demand is moving at a slower pace than many in the industry projected, and China has taken a huge lead in powering EVs, controlling 85% of global battery cell production, International Energy Agency data shows.

Making batteries and cells, the units that store and convert chemical energy into electricity, is a delicate process and doing so at scale is a challenge for any battery maker.

Northvolt has missed some in-house targets and curtailed production at its battery cells plant in northern Sweden, underscoring the difficulties, Reuters reported on Monday.

“The biggest issue is that batteries are not easy to make and Northvolt haven’t satisfied the supply demands of their customers – that is a management issue,” said Andy Palmer, founder of consultancy Palmer Automotive said.

“The Chinese are technologically 10 years ahead of the West in batteries. That’s a fact,” he said.

At least eight companies have postponed or abandoned EV battery projects in Europe this year, including China’s Svolt and joint venture ACC (NS:), led by Stellantis (NYSE:) and Mercedes-Benz (OTC:).

In 2024, Europe’s battery pipeline capacity out to 2030 has fallen by 176 gigawatt-hours, according to data firm Benchmark Minerals. That’s equivalent to almost all the current installed capacity in Europe, according to Reuters calculations.

RETHINK

Some executives say Europe should do more to attract and support home-grown projects so they can compete with Chinese rivals such as CATL and BYD (SZ:).

“Europe needs to rethink how it supports a nascent sector before China eats up the entire value chain, which is due to smart planning,” said James Frith, European head of Volta Energy Technologies, which specialises in battery and energy storage technology.

Among its $5.8 billion in debts, Northvolt owes the European Investment Bank (EIB) some $313 million.

EIB vice president Thomas Östros said it had been a constructive partner to Northvolt, but it needed to safeguard the EIB and EU’s interests.

“It remains the case that Europe has a strategic interest in a European battery industry for electric cars and we will follow developments very closely. But it is much to early to say what the outcome will be,” he said.

The Swedish government has repeatedly said it does not plan to take a stake in Northvolt.

On Friday, Northvolt’s outgoing CEO and co-founder Peter Carlsson said he was a “little worried” Europe is giving up on its dream of competing with China.

He said Europe would regret it in 20 years time if it retreated.

“It’s not a straight journey and right now, we’re all in a bit of a down in that journey where there’s more hesitations, there’s more questions on the speed of the transition from the carmakers, from policymakers, from the investor community,” he told reporters in a call.