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#AI hallucinations

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Composite showing three real-world chatbot incidents — Air Canada (February 2024, ruling against the airline), a Chevrolet dealership (December 2023, SUV "sold" for $1), DPD (January 2024, chatbot that insulted its own company) — alongside a well-configured chat widget that illustrates the three defenses of a serious AI assistant: system prompt, document base, and human escalation. Below, language model error rates and the impact of RAG on domain accuracy.
AI chatbot virtual assistant AI hallucinations

What happens when your AI chatbot gets it wrong (and how to limit the damage)

An AI chatbot can say things that aren't true, and now and then it does. From the Air Canada ruling to the actions taken by the Italian competition authority in 2026, one point is settled: the liability rests with whoever publishes the chat. The good news is that a small site has concrete tools to fail far less often — and to handle the failures when they come.

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