1st, this technique is not fraud, and fraud is a separate accusation. 2nd, paying customers can legally and legitimately be banned and monitored for breaking terms of service, which probably includes things like using the model against U.S. export restrictions.

> 2nd, paying customers can legally and legitimately be banned and monitored for breaking terms of service

Yes, I said that. If a user is breaking your terms of service, ban them. Continuing to charge them while not providing the service they're paying for is, in fact, literal textbook fraud.

No, it's totally legal to provide degraded quality of service to those breaking your ToS.

In any case this is not what is happening, but it is legal.

Banning is completely different than charging for a service you're silently not providing.

So if I change my timezone to Shanghai I deserve to get banned? Or get shitty model instead of what I’m paying for?

Do paying customers distill? Is it fraud to protect against distillers?

That's what capitalism is all about, baby! Especially if the customers don't notice.