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Y Combinator’s Garry Tan wants U.S. open-weight AI labs to ‘distill’ frontier models, too
Y Combinator CEO Garry Tan urges US open-weight labs to distill frontier models and regulators to stay out, countering Anthropic's crackdown calls.
Y Combinator CEO Garry Tan told CNBC he would "do nothing" about Chinese labs distilling frontier models and floated an "American distillation regime" letting US open-weight labs do the same to American frontier labs. Anthropic this week released its second report alleging Chinese labs conduct "illicit distillation attacks" using hidden identities, fraud, and stolen credentials, and CEO Dario Amodei has called for US regulators to crack down. Tan argued closed labs cannot dictate what customers do with API outputs, noting frontier labs trained on copyrighted material without permission, and called a single monolithic proprietary provider the true AI doomer scenario.
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Open-Source AI & Open Models Reading List
Interconnects publishes a curated open-model reading list covering release strategy, US-China competition, adoption data, and a narrowed 4-6 month open-closed frontier gap.
The list, updated September 11, 2026, compiles essays on open-model strategy, licensing gradients, safety of open weights, adoption data, and Chinese open-source history. It notes leading open models have come from Chinese labs since roughly 2024, citing Kimi K3 and GLM-5.2/5.3, and that the open-closed gap has narrowed to roughly 4-6 months. It also documents Western adoption of Chinese models, including Perplexity's use of DeepSeek R1 and Thomson Reuters moving to Qwen, which has drawn lawmaker probes at DoorDash, Airbnb, Anysphere/Cursor, and Apple.
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Microsoft has new AI privacy rules for schools
Microsoft agreed to enforceable AI safety and privacy principles with the AFT and UFT after New York City and Los Angeles imposed one-year bans on student-facing AI.
Microsoft committed to ten contractually enforceable principles covering AI use in schools, including not training models on student or educator data, limiting data collection, plain-language disclosure to families, prohibiting AI companions, and requiring human review for high-risk decisions. The agreement with the American Federation of Teachers and its NYC affiliate comes after NYC and LA implemented one-year bans on student-facing AI. Districts can adopt the terms into new or existing contracts starting in November.
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Risky Bulletin: Ukraine's top prosecutor resigns amid scam call center scandal
Ukraine's top prosecutor Ruslan Kravchenko resigned after NABU arrested a deputy for taking bribes protecting scam call centers running fake investment platforms.
Ukraine's anti-corruption bureau NABU arrested Serhiy Kropyva, Deputy Head of International Cooperation at the Prosecutor General's Office, alleging officials took monthly protection fees from a network of 100-500 scam call centers luring victims into fake investment platforms, with bribes reportedly growing from $700,000 to $3.5 million per month. Prosecutor General Ruslan Kravchenko resigned on Monday, calling it a political decision, while Kropyva was fired with bail set at 120 million hryvnias ($2.7 million) and over 100 call centers shut down in the past month. The newsletter also briefly covers a cyberattack crippling more than 80 Luxembourg medical practices via payment vendor BMS Engineering, ShinyHunters' claimed theft of 200,000 Florida DMV driver records, a cyberattack on the American Meteor Society, and school closures in Springfield, Massachusetts.
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Automobile Camouflage to Hide from Flock Cameras
Schneier on Security highlights a printed vehicle-camouflage pattern tested to defeat Flock surveillance cameras and Axon body cameras.
The post discusses covering cars with printed patterns designed to fool Flock automated license-plate recognition software, with testing reportedly done against Flock and Axon body cameras. Reader comments question effectiveness against other ALPR vendors, Flock's RF MAC-address upgrade, and whether such camouflage might become regulated. The page also contains off-topic comment threads about anti-bot over-blocking and privacy.
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Microsoft says virtually nobody was grabbing NYT articles through its chatbot
Microsoft files summary judgement briefs in NYT copyright lawsuit, arguing only 59,545 of 8.2M Copilot logs show substantial overlap with news content.
Microsoft filed new legal filings in the consolidated copyright lawsuit brought by The New York Times, authors, and publishers against Microsoft and OpenAI, arguing for summary judgement. Analysis of 8.2 million Copilot chat logs found only 59,545 contained at least 16 words in common with news content, with just 24 responses showing at least 30 matching words in the authors' case. Microsoft argues the numbers support fair use, claiming Copilot rarely reproduces substantive chunks; the Times says discovery shows Microsoft and OpenAI stole from it, and the Trump administration filed a statement of interest supporting OpenAI.
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Risky Bulletin: Dutch intel services to get extensive new powers
Netherlands proposed a bill granting AIVD and MIVD expanded warrantless tapping, faster hacking powers, and forced data disclosure, citing Russia, China, and Iran threats.
The Dutch government introduced a bill greatly expanding surveillance powers of intelligence agencies AIVD and MIVD, allowing up to one year of tapping without pre-approval and simplified hacking operations against 'foreign adversaries'. Agencies could compel Dutch companies or citizens to provide data under threat of charges, share data with the private sector, and oversight bodies would merge into a new CTT board. The bill follows similar overhauls in Ireland, Germany, and France after Russia's invasion of Ukraine. The newsletter also reports Moonwell hacked for $8.7M, a Cosmos EVM bug exploited for ~$3M, ShinyHunters listing McKesson with claimed hundreds of millions of records, and a pro-Kremlin DDoS claim against Norway's government network.
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Medical device firm Boston Scientific says cyberattack has disrupted shipment processes
Boston Scientific says a cyberattack disrupted shipment and operating systems, forcing engagement of an incident response firm with no restoration timeline.
Medical device manufacturer Boston Scientific disclosed a cybersecurity incident discovered Tuesday that impacted access to operating systems and business applications, including processing and shipping customer orders. The company filed documents with the SEC, hired a cybersecurity firm, and told investors full restoration may take weeks. No group has claimed responsibility and it is unclear whether ransomware is involved. The company reported $5.4 billion in net sales in Q2 2026 and produces pacemakers and stents.
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