Sun Apr 21 / Puneet Anand

Hallucination Fails: When AI Makes Up Its Mind and Businesses Pay the Price

Stories where AI inaccuracies negatively impacted the operational landscape of businesses.

A confused AI bot representing risks with using AI such as LLMs and Generative AI

Generative AI and Hallucinations

Generative AI promises a future filled with intelligent assistants, personalized content, and groundbreaking innovation, and it’s arguably revolutionizing a few sectors already.

But what happens when these powerful tools start to hallucinate, creating fantasies instead of facts?

This happens because all Gen AI models are probabilistic and non-deterministic. As such, they may incur a few errors, such as:

  • Answering the same question differently every time.
  • Misrepresenting facts.
  • Making up facts (more like fiction).

As the real-world stories we’ve gathered here show, AI hallucinations can have serious consequences for businesses and consumers alike.

Before we dive in further, we want to state that we are big fans of the companies mentioned below and their products…but their AI quality monitoring needs improvement!

1. Air Canada’s chatbot misguides passenger

Air Canada

A tragic circumstance unfolded when Air Canada’s chatbot erroneously assured a passenger of a post-flight discount, only for the airline to renege on the promise.

Despite Air Canada’s attempt to absolve itself of responsibility by attributing the misinformation to the chatbot as a “separate legal entity”, the tribunal ruled in favor of the passenger, holding the airline liable for the erroneous advice.

This case underscores the legal complexities arising from AI’s role in customer interactions and highlights the need for accountability in AI-driven services.

If you want the full story, please head over to this news article.

2. Chevrolet’s OpenAI-powered chatbot gets taken for a ride

Tahoe with ModelX doors

In an attempt to enhance customer support services, Chevrolet introduced a chatbot powered by OpenAI.

However, users quickly discovered its vulnerability to manipulation.

Instead of addressing customer queries, the bot found itself writing code, composing poetry, and even praising Tesla cars over Chevrolet’s offerings.

Soon enough, we saw multiple Reddit and X posts with users sharing exploits, from coaxing the bot into lauding Tesla’s superiority to crafting reasoning about why one should avoid buying a Chevy.

3. Fake lawsuit fiasco

Fined Attorney For Using ChatGPT

A recent legal case (Mata v. Avianca) serves as a stark warning for those who are eager to cut corners.

Lawyers unknowingly used ChatGPT to research a case brief, resulting in fabricated case citations and fake legal extracts.

This “hallucination” had disastrous consequences, leading to the dismissal of the client’s case, sanctions against the lawyers, and public humiliation.

Here’s the full story, as reported by The New York Times.

4. Chevy dealership and the $1 Tahoe

Image

In a bizarre turn of events, a chatbot deployed by a California car dealership offered to sell a 2024 Chevy Tahoe for a mere dollar, citing it as a “legally binding offer.”

The dealership, utilizing a ChatGPT-powered bot, found itself at the center of attention as users exploited the bot’s vulnerabilities for amusement.

This incident serves as a cautionary tale for businesses embracing AI-powered solutions without fully understanding their capabilities and limitations.

From legal repercussions to customer dissatisfaction, the risks of unchecked AI are profound.

The full story, here.

5. Wyoming reporter caught using AI to fabricate stories

Image

A recent incident at the Cody Enterprise, a Wyoming newspaper, has raised serious concerns about the use of AI in journalism.

A reporter was found to have used AI to generate fake quotes and entire stories, including fabricated statements attributed to Wyoming Governor Mark Gordon.

The issue was uncovered by a competing journalist who noticed inconsistencies in the language and content of the articles…and smelled rat.

Following the revelation, the Cody Enterprise issued an apology and committed to establishing strict policies to prevent similar occurrences in the future.

Read more about this story in this news article.

Are AI hallucinations avoidable?

These situations could have been avoided to a great extent.

All companies have a source of truth for their businesses and industries they operate in - often embodied in a variety of documents and data sources like policies, standards, reports, and real-time information in databases.

This source of truth can be used by systems like AIMon Rely to get instant feedback on hallucinations, effectively detecting them as they pop up.

If you’re curious about improving your LLM apps, try AIMon for free.

6. Bonus: That is definitely not reliable!

Reliability mispelled by Image generator

OK, I will throw in a hallucination I fabricated based on a popular Image Generator model. I was creating the Generative AI Reliabilitycommunity on Discord recently and went on to a few image generator models to help me create a logo for it. My prompt was simple - “happy robot that says reliability on its hat”. Guess what only one out of four generated images had the right spelling of Reliability. That is not reliable!

About AIMon

AIMon helps you build more deterministic Generative AI Apps. It offers specialized tools for monitoring and improving the quality of outputs from large language models (LLMs). Leveraging proprietary technology, AIMon identifies and helps mitigate issues like hallucinations, instruction deviation, and RAG retrieval problems. These tools are accessible through APIs and SDKs, enabling offline analysis real-time monitoring of LLM quality issues.