What is AI washing?
Quick answer
AI washing is when a company exaggerates or invents its use of AI in marketing, sales pitches or investor materials, such as calling a fixed rule "AI-powered" or an ordinary chatbot "an autonomous agent". The term echoes greenwashing, and regulators treat false AI claims like any other false claim.
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Updated · By Robert Breen
Why it matters for a small business
In March 2024 the US SEC settled charges against two investment advisers for misleading claims about their use of AI, and the FTC has brought cases against deceptive AI claims. The message to businesses is the same as for any product claim: say only what the product really does.
As a buyer, AI washing wastes your money. Ask vendors to show the feature on your data, explain what part is AI and what is fixed rules, and say what happens when it is wrong.
The same honesty applies when you describe your own services. If your firm uses AI to draft and people to check, say exactly that. Clients tend to trust a clear description more than a buzzword.
In a real lesson: AI Agent vs Chatbot vs Automation: One Job Done Three Ways
AI Agent vs Chatbot vs Automation gives you the test to see through a lot of AI washing. Oak Hill Pet Grooming's six invoices go through three tools: a chatbot writes a template with blanks, an automation sends the same reminder to everyone past 14 days, including Ben, who already paid $60 of $120.
Only ChatGPT's Work mode, acting as an agent, notices Ben's partial payment and flags it for Tara. When a vendor calls their product an agent, ask whether it handles the Ben case or just sends the template.
Try this lesson free or read the step-by-step guide.
Common confusions
AI washing vs automation
Plenty of good tools are plain automation with fixed rules. The problem is only when they are sold as AI they are not.
AI washing vs a new AI feature
A real AI feature can be small. AI washing is about claims bigger than the feature.
Tips
- Ask the vendor to demo on your own messy example.
- Ask which steps are AI and which are fixed rules.
- In your own marketing, describe what the AI does in plain words.
Related terms
More Business terms
Where you use it: free lessons
- AI Agent vs Chatbot vs Automation: One Job Done Three Ways (ChatGPT, 7 min)
- ChatGPT Work: Have ChatGPT Do a Multi-Step Task (ChatGPT, 8 min)
Frequently asked questions
- Is AI washing illegal?
- False or misleading claims can break consumer protection and securities rules, whether they are about AI or anything else.
- How do I spot AI washing?
- Vague claims, no demo on real data, and no clear answer to "what exactly does the AI decide?" are the usual signs.
- Is it AI washing to call a chatbot AI?
- Not if it really uses an AI model. It becomes AI washing when the claims go beyond what the product does, such as promising it works on its own when it needs constant help.