Saudi national charged with installing surveillance device at OpenAI

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Abdulrahman Alfozan, a Saudi national, faces charges for allegedly installing an eavesdropping device at OpenAI. Federal prosecutors stated he booked one-way flights to Saudi Arabia prior to his arrest. Alfozan, a former engineering lead at OpenAI, was terminated and is currently in custody; if convicted, he could face up to five years in prison. The case has attracted attention amid ongoing discussions about liquidity and crypto markets. Alfozan is also connected to Raed Ventures, a firm linked to the Saudi royal family. The timing has raised questions in light of the upcoming MiCA (EU Markets in Crypto-Assets Regulation).
CoinDesk reports:

The U.S. federal prosecutor told the judge in a newly unsealed court filing that Abdulrahman Alfozan, the Saudi national accused of secretly installing a recording device in an executive meeting room at OpenAI, had already booked one-way tickets from San Francisco to Saudi Arabia for his wife and another family member prior to his arrest.

The U.S. Attorney’s Office for the Northern District of California, in a filing submitted on October 8, stated that Alfozan “had the means—and the motive—to flee the United States earlier, prior to his arrest, upon learning of this case.” The filing at that time requested the judge to seal the criminal complaint and arrest warrant against him.

The documents state that the flights were booked for October 12 from San Francisco via Istanbul to Saudi Arabia. The judge approved the sealing request, and the U.S. Department of Justice stated that Alfozan was arrested on October 9.

The Department of Justice stated that he has been detained since his arrest.

Alfozan, 35, is a venture partner at a Saudi venture capital firm whose website lists a member of the Saudi royal family as one of its partners.

The venture capital firm Raed Ventures states on its website that Alfozan, a resident of the San Francisco area, is an experienced technology professional with deep expertise in startups, entrepreneurship, and scaling technology companies.

The biography on Raed's website also states: "He is currently the Head of Engineering at OpenAI, focusing on AI Agents and data platforms."

Raed focuses on investments in the Middle East. The company’s website shows that Alfozan joined on February 8, 2025. Two days earlier, Raed announced that Prince Khalid Bin Bader Al Saud of Saudi Arabia had also joined as a venture partner. Venture partners typically hold advisory or project-based roles, rather than being investment partners or directors responsible for fundraising or leading deals.

The Department of Justice stated that Alfozan worked at OpenAI starting in July 2025. OpenAI said it terminated his employment this month.

The Financial Times reported on Wednesday that when Saudi tech influencers visited San Francisco in September, "it was Alfozan who greeted them at OpenAI’s office and showed them around."

A former CIA official, who requested anonymity due to the nature of their past work and extensive experience in the Middle East, told CNBC that Raed Ventures is “essentially a state entity of the Saudi government.” One of Raed’s funds received investment from Saudi Venture Capital in December 2024; Saudi Venture Capital is a subsidiary of SME Bank, which is part of Saudi Arabia’s National Development Fund.

In addition to serving as a risk partner at Raed, Prince Khalid Bin Bader Al Saud is a member of the Saudi ruling family, the Al Saud, and serves as Managing Director and Deputy Chairman of the family’s private office, according to his biography on Raed’s website.

The former CIA official said that if Alfozan’s alleged surveillance of OpenAI is part of a state-sponsored espionage campaign, it indicates that “even the Kingdom of Saudi Arabia has assessed that the risks of conducting economic espionage against a close ally are worth taking amid the AI and tech boom.”

The former official also said that this incident "is likely just the tip of the iceberg."

The criminal complaint against Alfozan does not allege that Raed or his other partners were aware of Alfozan’s alleged installation of recording devices at OpenAI.

The Department of Justice stated that this case is being prosecuted by the National Security, Cyber, and Special Prosecutions Unit of the U.S. Attorney’s Office for the Northern District of California.

Alfozan has been charged in the U.S. District Court for the Northern District of California with one count of using or attempting to use an electronic, mechanical, or other device to intercept oral communications.

He is currently detained and awaiting a detention hearing on October 19, at which his attorney may seek his release on bail. The Department of Justice states that, if convicted, he could face up to five years in prison and a $250,000 fine.

Alfozan has not been accused of corporate espionage or theft of trade secrets.

Earlier this year, OpenAI held discussions with Saudi Arabia’s sovereign wealth fund, the Public Investment Fund, regarding an investment in the AI company.

Raed did not immediately respond to requests for comment. CNBC has also requested comment from the Saudi Embassy in Washington.

Alfozan’s criminal defense attorney, William Pernik, told CNBC via email: “The information available is currently extremely limited, as the charging documents were only unsealed yesterday.”

OpenAI declined to comment on whether it was aware of Alfozan’s position at the Saudi company on Wednesday. The company also stated that, due to operational security concerns, it could not provide further details about the involved meeting room.

The company posted on X on Tuesday: "Currently, we have no indication that this individual improperly accessed or leaked model weights, source code, or customer data."

“We place great emphasis on protecting technology, data, and personnel, which is also a critical matter at the national level,” the company stated. “Our security program is designed to defend against a wide range of threats, from internal risks to cybercriminals and state-level adversaries, and this case is a prime example of how AI helps address these complex security threats.”

During a recent interview on the podcast "Identity Capital," Alfozan mentioned that in July 2016, he and other Saudis working at various tech companies in Silicon Valley met with Crown Prince Mohammed bin Salman, who was then the de facto ruler of Saudi Arabia. The Crown Prince was visiting Silicon Valley to promote his economic diversification plan, Vision 2030.

“One of the issues we discussed was whether we should return now to the Kingdom of Saudi Arabia to bring back technical skills to improve the economy… or whether we should work a few more years first to gain more experience before returning,” Alfozan said in an interview conducted in Arabic, translated by CNBC and published on September 24.

Alfozan said that Bin Salman responded, "The country is undergoing major construction, but there are not yet enough talents to cultivate the next generation to continue these development plans."

Alfozan added that the group of young employees "ultimately decided it was best to continue learning and enhancing our skills before bringing our knowledge back to [Saudi Arabia] to improve the technology industry."

Throughout the podcast, Alfozan detailed his journey from programming in high school in Dammam, Saudi Arabia, to his subsequent development in the United States. During the interview, he referred to himself as “an introverted person,” yet still pushed himself to help other young professionals succeed in Silicon Valley.

Several days after the podcast launched, on September 30, a federal criminal complaint stated that an OpenAI employee discovered "a covert audio recording device plugged into the USB port on the back of a television in a conference room."

The complaint states that the device includes a removable camera sensor, a digital microphone, and a microSD storage card, and was concealed within toilet paper.

According to the complaint, Alfozan is not authorized to enter this meeting room, which is frequently used for discussions of highly confidential technical, commercial, and strategic information.

Complaints state that this meeting room is “bookable only by executives and executive assistants” and is typically used for “internal leadership meetings and technical and product meetings, as well as external briefings with government officials and business partners.”

According to the complaint, CCTV footage from OpenAI shows Alfozan appearing near the meeting room at various times over multiple days in September.

The document also states that in August and September, Alfozan used an AI productivity tool to query OpenAI’s building address, meeting rooms, room capacities, schedules, and “external partner meetings.”

The complaint also states that a chatbot associated with Alfozan’s spouse—whom prosecutors allege shares several identifying characteristics with Alfozan’s own account—supposedly provided detailed instructions on how to build, customize, install, and remotely access recording devices. The complaint does not allege any wrongdoing by the spouse, nor does it name the spouse.

After discovering a recording device in the conference room TV, OpenAI installed a camera in the room, according to the complaint.

The complaint states that at approximately 1:20 PM on October 5, the camera footage showed Alfozan entering the meeting room and "inspecting behind the TV where recording device 1 was plugged in."

The complaint also stated that on the same day, Alfozan left an unattended bag in a printing room at OpenAI.

OpenAI security personnel found his wallet, ID, and "another recording device" inside the bag; the device, according to the complaint, was manufactured by the same Chinese company, Seeed, which also produced the device inserted into the meeting room TV.

The complaint states that the second recording device is identical to the first, “featuring a recording microcontroller” and “customized to conceal any content stored within the device, such as potentially intercepted audio communications.”

The complaint states that Alfozan reported to OpenAI that he had lost a bag, which was subsequently returned to him, but the second recording device was not returned with the bag. Despite asking about other items he claimed to have lost, he did not inquire about the device, according to the complaint.

FBI San Francisco Division Chief Scott Schelble said on Tuesday regarding Alfozan’s arrest: “Any attempt to illegally obtain protected information from U.S. superintelligent and technology companies threatens American innovation and the national security interests supported by these advancements.” He used the term for artificial intelligence preferred by the Trump administration.

Before joining OpenAI, Alfozan had a long career in the Bay Area.

On his LinkedIn page, Alfozan describes himself as a seasoned engineering leader with 11 years of experience building scalable, reliable software systems in data and AI/ML.

His bio also states: “Proven track record in leading engineering teams, delivering complex projects, and enterprise products. Passionate about strong project management and fostering a culture of collaboration and engineering excellence.”

Before joining OpenAI, Alfozan was a founding engineer at AI logistics company Nash, according to his LinkedIn profile.

Prior to Nash, he served as a senior systems engineer at Meta, Facebook’s parent company, from 2017 to 2022, according to his LinkedIn profile. Earlier, he also completed an internship at Microsoft, according to his bio.

Alfozan's LinkedIn profile shows that he studied computer science and engineering at MIT and data science at the University of California, Berkeley.

The MIT Media Relations Office stated that he attended the school from January 2011 to January 2014, and again from February 2016 to May 2016, but did not earn a degree.

A spokesperson for the University of California, Berkeley stated that Alfozan attended the university from January 2023 to May 2025 and earned a master’s degree.

He said on LinkedIn that in 2016, he served as a research intern at King Abdullah University of Science and Technology in Saudi Arabia.

According to this bio, he won the second-place prize of $50,000 in the Saudi COVID-19 Challenge hackathon in 2020.

Alfozan’s residence, located on a hillside in Millbrae, California, overlooks San Francisco Bay and offers views of the Diablo Mountains. This small suburb in San Mateo County is popular among tech professionals, situated about 30 minutes south of San Francisco and roughly 25 minutes north of Stanford University. When a CNBC reporter knocked on the door on Wednesday, there was no answer.

The Financial Times reported that Alfozan "was born in the extremely conservative Qassim region in central Saudi Arabia," but "grew up in Dammam, in the kingdom's oil-rich eastern province."

The Financial Times also reported that in a documentary about Alfozan aired on Saudi television, his father said that as a child, Alfozan participated in a government-supported gifted children program where he studied mathematics, physics, and engineering, and would "read encyclopedias from cover to cover."

“We are awaiting the government’s evidence against my client and look forward to presenting all appropriate defenses in court,” said Pernik.

The lawyer said, “The statement I can make on his behalf is that, like countless Americans, Mr. Alfozan came to this country as a young man with dreams many years ago. He spent years studying, working, and contributing to the U.S. technology industry—a sector largely built by immigrants like him.”

“These allegations seem completely out of character for him,” said Pernik. “We will thoroughly investigate all evidence provided by the government in this case to understand exactly what happened, who is responsible, and any possible motives.”

The attorney noted that Alfozan "was accused of violating federal recording regulations, not of stealing trade secrets or acting as a foreign agent."

“There is currently no evidence to suggest otherwise, at least none that has been disclosed to us,” said Pernik. “Where a person is born does not prove anything, and nationality—in our legal system—should always be a protected status.”

Ashley Capoot, Lora Kolodny, and Reem Nasr contributed to this report.

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