Free NewsletterPro Login

Warning: Undefined variable $stocks in /var/www/briefs.co/htdocs/wp-content/plugins/oxygen/component-framework/components/classes/code-block.class.php(133) : eval()'d code on line 448

Warning: foreach() argument must be of type array|object, null given in /var/www/briefs.co/htdocs/wp-content/plugins/oxygen/component-framework/components/classes/code-block.class.php(133) : eval()'d code on line 448

Warning: Undefined variable $funds in /var/www/briefs.co/htdocs/wp-content/plugins/oxygen/component-framework/components/classes/code-block.class.php(133) : eval()'d code on line 472

Warning: foreach() argument must be of type array|object, null given in /var/www/briefs.co/htdocs/wp-content/plugins/oxygen/component-framework/components/classes/code-block.class.php(133) : eval()'d code on line 472
/* the link was here */

SpaceX AI Policy Lead Grilled Over Grok, Safety Controls and User Harms

Published Oct 16, 2026
Share:
Summary:
  • SpaceX's AI policy head Gabriela Castillo Madrid faced sharp questioning from NYC Council leaders after Council Speaker Julie Menin said Grok surfaced a sexualized image of her in seconds.
  • Former xAI staffer Devin Kim told the council he helped build Grok's training and evaluation systems and began flagging safety risks in January 2025, claims he says his manager dismissed.
  • SpaceX recently merged with xAI, putting Grok under SpaceX's umbrella; the company later appeared after initially dodging a subpoena to testify alongside other AI firms.

What set off the hearing

SpaceX's Gabriela Castillo Madrid appeared by video before the council's tech committee on Friday and immediately ran into pushback. Menin challenged her assertion that the company has appropriate safeguards, saying she and her team typed her name into Grok that morning and quickly found a sexualized image of her. Castillo Madrid said SpaceX maintains "strict controls" and that its safety team would review the specific case.

Tech committee chair Carmen De La Rosa condemned it as "disgusting" that Grok allows people to transform real women's photos into sexualized material without consent. Menin added, "I just don't understand how you can say that there are these safe models," calling the situation "unacceptable."

Councilmember Mercedes Narcisse pressed on medical use. Castillo Madrid said Grok is "not meant to be a clinician, a doctor," and added, "in terms of privacy, users decide whether their Grok conversations are used to train our models or not." Narcisse warned that telling people on X to upload MRIs or X-rays and expect a firm diagnosis is dangerous, then criticized the SpaceX representative for vague replies: "You're supposed to give us answers, you're not."

Whistleblowers, safety culture and Kim's account

When De La Rosa asked how many whistleblowers SpaceX had terminated, Castillo Madrid replied that she did not know of any. Menin then referenced reporting that former employee Devin Kim was let go after raising serious safety issues. Castillo Madrid said she was not familiar with that case and described a culture where "everybody has a an ability to say something when they see something."

Kim, who serves as President of the nonprofit Center for AI Safety, appeared via video alongside his lawyer. He said he was among the first hires at xAI and "built the systems that researchers use to train and evaluate Grok." He told council members he started escalating concerns in January 2025 and that his manager shut them down, quoting his supervisor as saying, "AI safety was useless, and that AI would kill us and all anyways."

When policy and technology intersect, staying informed matters, so sign up for the free Market Briefs for a quick daily summary.

Kim also said that earlier internal standards permitted "tasteful nudity" and framed it as the goal. He testified that there were three people handling AI safety during his tenure, and that many departed after he left, which he linked to dissatisfaction with how safety was run.

Attendance fight, merger moves and legal pressure

SpaceX initially skipped an Oct. 5 hearing with OpenAI, Anthropic, Google and Meta, defying requests and a subpoena. The company ultimately committed to attend this week once the council warned it would seek a court order to compel attendance. The inquiry follows a month of heated debate about advanced AI risks, and the council says it will use testimony and documents from the probe to shape new rules.

In February, Elon Musk combined SpaceX with xAI, tying his AI and social platform operations to the rocket business, which also operates the Starlink satellite internet network. The merger put Grok under SpaceX's oversight, and the model sees use at certain federal agencies, including the Pentagon. In June, SpaceX debuted on public markets and is valued at roughly $2 trillion. In August, SpaceX closed a $60 billion deal to buy AI coding startup Cursor.

By missing the earlier session, SpaceX avoided questions from U.K. Parliament member Jess Asato, who testified there about being targeted by online abuse fueled by AI. In the U.K., Asato has brought a lawsuit against xAI, claiming Grok users generated and distributed sexualized images of her without consent, and she is seeking damages both for the tort of misuse of private information and for infringements of European data protection laws. The BBC reported she criticized SpaceX's failure to appear as "arrogance." SpaceX failed to provide a comment when asked before the meeting.

Why it matters for your portfolio

Regulatory heat is rising, and this council's findings could inform new AI rules that touch everything from user privacy to model governance. At the same time, SpaceX now controls Grok and has made big corporate moves and claims a multitrillion valuation, while testimony surfaced questions about internal safety resources and standards.

The bottom line: the probe, the merger, and the lawsuit front all point to policy risk joining product risk for a major name in AI and space. For anyone tracking exposure to SpaceX or its partners, watch how City Hall's inquiry, potential regulations, and any follow on disclosures evolve.

When debates over technology are unfolding, it helps to have quick reliable context, so subscribe to Market Briefs newsletter every morning.

Disclosure

Recent News

1 2 3 … 102

Get Market Briefs delivered to your inbox every morning for free!

No fluff. No noise. No politics. Just finance news you can read in 5 minutes.

Blogs

October 5, 2026
What Is the Briefs Connector? A Simple Guide
  • The Briefs Connector lets your favorite AI read Briefs research, like Pro reports and the Briefs Score.
  • Without it, an AI asked about investing can give answers that sound right but aren't backed by that research.
  • It explains the research, but it won't tell you what to buy or sell.
Read More
October 5, 2026
Is a Recession Coming? What the Last Five Rate Hiking Cycles Say
  • The Fed has started raising rates again, and in the last five hiking cycles going back to 1994, a recession never started while the hikes were underway.
  • The pain showed up where there was a bubble to pop - housing in 2008, dot-coms in 2000, the pandemic money-printing boom in 2022 - and usually after the hikes ended.
  • Private equity and private credit are feeling this cycle first, and how far the pain spreads depends on how high rates go and how long they stay there.
Read More
October 2, 2026
Fed Interest Rates May Rise Again in 2026 - and the Newest Culprit Is AI
  • Fed Governor Barr told a meeting our head of investing research attended that higher rates are likely in 2026, lower inflation may not come soon, and AI is now pushing prices up.
  • The same week, President Trump asked the biggest AI companies to police themselves under an accord that's morally but not legally binding, because the White House sees AI as a race with China.
  • Higher rates put downward pressure on asset prices and squeeze borrowers, but the way through hasn't changed: own investments, buy on a schedule, and treat downturns as discounts.
Read More
October 1, 2026
Housing Market 2026: Why Office Buildings Are Cracking Before Houses Do
  • Office buildings are selling for 80% to 95% off because their five-year loans are resetting at much higher rates while half-empty floors have gutted the income those buildings are valued on.
  • Housing is under pressure, not cracking: a $400,000 mortgage costs $975 more a month than at 3%, but six of every seven mortgages are still under 6% and those owners are staying put.
  • Whether pressure turns into cracks is a race between unaffordability and the economy, and either way Jaspreet's rule is to treat your house as a liability and buy only what you can afford.
Read More
September 30, 2026
Dividend Investing vs. Growth Investing: Why the Slower Portfolio Can End Up Bigger
  • "What stock should I buy?" is the wrong first question. Growth, income, or wealth preservation comes first, and the goal changes which stocks even make sense.
  • At $500 a month for 30 years, 13% growth builds about $1.75 million. 10% growth plus a reinvested 4% dividend builds a little more than $2.2 million and pays a little more than $80,000 a year.
  • Income investors have US dividend ETFs, REITs, and international dividend funds to study. Growth investors have the Nasdaq 100, AI and chip funds, and small caps. None of it is a recommendation.
Read More
September 29, 2026
Why Is Gold Going Down? A 5.2% Treasury Yield Just Took Its Job
  • President Trump rejected Iran's deal to reopen the Strait of Hormuz, oil prices jumped back up, and gold fell instead of rising.
  • Treasury yields hit their highest level in more than 20 years, so investors sold gold and bought Treasuries that pay interest.
  • Higher Treasury yields make the national debt, mortgages, car loans, and credit cards more expensive, with the Fed's next rate decision due October 28.
Read More
September 28, 2026
The Strategic Bitcoin Reserve: Why the Government Wants Bitcoin to Explode
  • The US government holds about 328,000 Bitcoin, worth roughly $25 billion, and since a 2025 executive order it keeps seized coins instead of selling them.
  • Washington wants a bigger pile of assets so its $40 trillion national debt looks smaller next to them, which lets it keep borrowing and spending.
  • Bitcoin's wild price swings, and a government holding a coin built to escape governments, are the two risks investors need to watch.
Read More
September 25, 2026
BRIEFS EXCLUSIVE: 43% Of Respondents Say Bills Outran Their Income Over Past Two Years
  • 43% of the 494 Market Briefs readers surveyed said their bills grew faster than their income over the past two years, even though 79% could cover a surprise $5,000 expense tomorrow.
  • Half of readers own gold or crypto, the two classic bets against a weaker dollar, and only 13% bought nothing at all in the last 12 months.
  • The median reader says it takes $150,000 a year to feel financially secure, about $62,000 above the U.S. median household income.
Read More
September 25, 2026
The Economy Is Booming. So Why Did Stocks and Bonds Fall Together?
  • S&P Global says the US economy is growing at its fastest rate since 2021, with corporate profits up 28.9% in a year, almost four times the historical average.
  • Stocks and bonds fell at the same time, which is not how the two markets normally behave, because Treasury yields above 5% now compete with stocks for investors' money.
  • Jaspreet Singh lays out three ways to invest through a shift like this: always be buying, buy the crash, or follow the money before it hits the headlines.
Read More
September 24, 2026
The 2026 Economic Reset Is Starting: Are We in a Recession, or Is the Pain Still Ahead?
  • The Federal Reserve has flipped from stimulating the economy to fighting inflation with higher interest rates, while the White House still wants growth at almost any cost.
  • The national debt tops $40 trillion, has outgrown the entire U.S. economy, and its interest payments are now the government's fastest-growing expense.
  • Higher rates bring pain for private equity, private credit, and speculative assets, but they open opportunities for investors holding cash, treasuries, and value assets.
Read More
1 2 3 … 28
Share via
Copy link