Goldman Sachs, JPMorgan, Citigroup, and Bank of America received subpoenas from the Securities and Exchange Commission to provide records on AI hedge fund Situational Awareness. Regulators are reviewing the fund's trades, leverage, and communications with its lenders after a series of leveraged artificial intelligence bets failed. The fund lost approximately 67% of its portfolio in July, which triggered a forced liquidation of assets.

JPMorgan has reportedly terminated its lending relationship with the fund following the losses. No wrongdoing has been alleged by the SEC at this stage of the probe into Wall Street's financing of leveraged AI positions. The hedge fund, managed by Leopold Aschenbrenner, recently returned to the options market to buy call options in AMD and Bloom Energy.