In the UK, AI tools like ChatGPT are making their way into the courtroom, and it's causing serious problems for the justice system. Multiple lawyers have been caught submitting legal filings filled with fake case law. In two recent rulings, one lawyer cited 18 fictional cases in a £90 million lawsuit, and another included five non-existent precedents. The issue has become so widespread that the UK High Court issued an official warning to legal professionals to stop relying blindly on AI.

How Do These AI Errors Happen?

  • Automated Errors, Real Consequences: Lawyers are using generative AI to draft legal summaries and arguments without verifying the information. The result? Completely fabricated cases—so-called “AI hallucinations”—slip into official filings.
  • Courts Crack Down: High Court Judge Dame Victoria Sharp called the practice a threat to public trust in the justice system. Lawyers now face penalties ranging from public reprimands to contempt of court, and even criminal charges if the misuse is deliberate.
  • It’s a Global Issue: This isn’t just a UK problem. In the U.S., even government officials have fallen for AI hallucinations. One high-profile example: a report submitted by Health and Human Services Secretary RFK Jr. included fake studies and inaccurate data created by AI.

AI Hallucinations Could Affect Your Business, Too

The same tools misused by legal professionals and government officials are being used every day in business environments from everything from writing marketing content, contracts, proposals, blog posts, and more. When unchecked, AI-generated content can introduce critical errors into your workflow and damage your credibility.

What should SMBs watch for?

  • Inaccurate Documentation: AI-generated reports may include fabricated data, stats, or sources.
  • Compliance Risks: Legal or HR documents created by AI without review can open your business up to fines or violations.
  • Reputation Damage: Sharing unverified content can break trust with clients, partners, or regulatory bodies.

What You Can Do

  • Always Validate AI Output
    Don’t assume AI is correct. Review everything. Implement a fact-checking process before sharing or publishing content.
  • Train Your Team
    Make sure your employees understand AI is a tool, not a final authority. Knowing where and how to use it is key.
  • Set AI Governance Policies
    Establish clear internal guidelines for how AI should be used, reviewed, and who is responsible for oversight.

Let’s make sure your AI tools are working for you, not against you.
Contact ISM today to schedule an AI policy audit, team training, or implementation strategy.