AI washing occurs when companies claim to be using artificial intelligence (AI) technology to enhance their services, but in fact are not. In March of 2024, two investment advisors paid $400,000 in civil penalties “for making false and misleading statements about their purported use of artificial intelligence (AI).” See this statement from the Securities Exchange Commission: SEC Charges Two Investment Advisers with Making False and Misleading Statements About Their Use of Artificial Intelligence.
In April of 2024, Amazon addressed claims that its cashless grocery store experience “Just Walk Out” was run by humans instead of AI.
See also: SEC’s Artificial Intelligence (AI) and Investment Fraud: Investor Alert
[Last updated in July of 2024 by the Wex Definitions Team]