AI washing is a deceptive marketing tactic that consists of promoting a product or a service by overstating the role of artificial intelligence (AI) integration in it.[1][2] It raises concerns regarding transparency, consumer trust in the AI industry, and compliance with security regulations, potentially hampering legitimate advancements in AI.[3] U.S. Securities and Exchange Commission (SEC) chairman Gary Gensler compared it to greenwashing.[4]
Some companies have been accused and/or shuttered of trying to capitalize on this trend by exaggerating the role of AI in their offerings. In March 2024, the SEC imposed the first civil penalties on two companies, Delphia Inc and Global Predictions Inc, for misleading statements about their use of AI.[5][6] And in July 2024, the SEC shutdown and charged the CEO and founder of Joonko, a supposed AI hiring startup, with fraud alleging (amongst other serious charges) that he "engaged in an old school fraud using new school buzzwords like ‘artificial intelligence’ and ‘automation,’”[7]
References
edit- ^ "AI washing explained: Everything you need to know". Tech_target. 29 February 2024. Retrieved 5 June 2024.
- ^ "Keep your AI claims in check". Federal Trade Commission. 27 February 2023. Retrieved 5 June 2024.
- ^ "Beware businesses claiming to use trailblazing technology. They might just be 'AI washing' to snare investors". The Conversation. Retrieved 5 June 2024.
- ^ "SEC Head Warns Against 'AI Washing,' the High-Tech Version of 'Greenwashing'". The Wall Street Journal. 5 December 2023. Retrieved 5 June 2024.
- ^ "SEC Charges Two Investment Advisers with Making False and Misleading Statements About Their Use of Artificial Intelligence". U.S. Securities and Exchange Commission. 18 March 2024. Retrieved 5 June 2024.
- ^ "Decoding the SEC's First "AI-Washing" Enforcement Actions". Harvard Law School Forum on Corporate Governance. 18 April 2024. Retrieved 5 June 2024.
- ^ "SEC Charges Founder of AI Hiring Startup Joonko with Fraud". U.S. Securities and Exchange Commission. 11 June 2024. Retrieved 17 September 2024.
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