AI washing

Extracted Attributes

• Coined By

  AI Now Institute

• Definition

  Deceptive marketing tactic overstating the role and integration of artificial intelligence in a product or service

• Year Coined

  2019

• Derived From

  Greenwashing

• Regulatory Concerns

  Transparency, investor deception, consumer fraud, and legal compliance

Timeline

• The term 'AI washing' is first defined by the AI Now Institute at New York University. (Source: Wikipedia)

  2019-01-01

• The California Management Review publishes an article analyzing the cultural traps of AI washing and how CEOs can prevent them. (Source: California Management Review)

  2024-12-01

• The U.S. Securities and Exchange Commission (SEC) files a complaint against Alberto Saniger, former CEO of Nate, Inc., for falsely claiming the app was powered by AI. (Source: International Trademark Association)

  2025-04-01

AI washing

AI washing is a deceptive marketing tactic that consists of promoting a product or a service by overstating the role of artificial intelligence (AI) and the integration of it. Companies often involve in the practice to mislead customers to boost their offerings, and to secure funding from investors. The practice raises concerns regarding transparency, and legal issues.

Web Search Results

• AI Washing: An Emerging Topic - International Trademark Association

  The term “AI washing” originated with regulators who adopted it by analogy to “greenwashing,” a term widely used by the U.S. Federal Trade Commission (FTC) and the Securities and Exchange Commission to describe companies that present themselves as more sustainable than they truly are. Similar logic now applies to misleading claims about AI, reflecting growing concern about marketing practices that may mislead consumers and investors. [...] We note that the concept of AI washing is still in its early stages. However, given the increasing prevalence of AI in daily life, courts and legislators are likely to intervene more actively as needed to protect consumers and businesses from misleading or deceptive claims about the use of AI. Between the drafting and publication of this article, the legal landscape may well evolve. Counsel is encouraged to remain closely informed and to monitor this rapidly developing area of law. INTA’s Unfair Competition Committee remains committed to ongoing monitoring on behalf of INTA and its members, and we look forward to providing further reports as appropriate to update these findings. [...] The U.S. Securities and Exchange Commission (SEC) has also initiated several actions involving AI-related claims. For instance, in April 2025, the SEC filed a complaint against Alberto Saniger, former CEO of tech start-up Nate, Inc., alleging that Saniger solicited investments in its app—purportedly powered by AI—to complete users’ purchases and other tasks. In reality, the orders were being entered manually by contract workers in the Philippines and elsewhere.

• “AI Washing” – The New Deceptive Marketing Technique - Pomerantz LLP

  AI washing can take different forms. A company could outright lie about the existence of AI in its products, ex­aggerate AI’s impact on the business or its capabilities, or falsely suggest a new AI system can out-perform existing, non-AI products or systems. AI washing can also involve exaggerating a new AI operation’s sustainability or sug­gesting that AI represents a new direction when its use in a given situation is just a gimmick. AI technology requires massive computing power and data storage as well as up-to-date data sets to feed the algorithm, all of which are costly. It is equally AI washing for a company to tout its new AI system without acknowledging those costs. [...] that com­panies should consider whether AI discussions might be material to investors. Clearly, the SEC will stay focused on this problem. [...] In Hoare v. Oddity Tech Ltd. et al., No. 1:24-cv-06571 (S.D.N.Y.), shareholders of Oddity, a consumer tech platform that uses AI to identify customer needs and solutions in the beauty and wellness products space, allege that the company overstated its AI technology and capabilities, and the extent to which that tech-nology drove sales. According to the suit, the truth emerged in a short seller report describing discussions with former employees who called the company’s AI “nothing but a questionnaire.”

• AI washing - Wikipedia

  AI washing is a deceptive marketing tactic that consists of promoting a product or a service by overstating the role of artificial intelligence (AI) and the integration of it. Companies often involve in the practice to mislead customers to boost their offerings, and to secure funding from investors. The practice raises concerns regarding transparency, and legal issues. ## Definition [edit] [...] AI washing is a deceptive marketing practice. It involves promoting a product or a service by overstating the role of artificial intelligence (AI) and its integration in the design and manufacture of the same. The practice raises concerns regarding transparency, compliance with security regulations, and consumer trust in the AI industry potentially hampering legitimate advancements in AI. The term was first defined by the AI Now Institute, a research institute based at New York University in 2019. The term is derived from greenwashing, another deceptive marketing technique that misrepresents a product's environmental impact in a similar manner. AI washing might involve a company claiming to have used AI in the development or enhancement of its products or services without its actual [...] ## Usage and effects [edit] AI washing can lead to deception of customers and misleading of investors. It is also an illegal and unethical practice that lacks transparency regarding disclosing the details of a product or a service. Companies get involved in such a practice often in response to competition who might have used AI in their offerings. It might also be used as a ploy to secure funding and investment, assuming that it will attract them towards it. AI washing has been compared to dot-com bubble, when businesses appended "dot-com" to the end of the business name to boost their valuation.

• AI Washing: Signs, Symptoms, & Suggested Solutions

  The CFA Institute report “AI Washing: Signs, Symptoms, and Suggested Solutions” addresses the growing concern around AI washing (AIW) — the act of falsely or overly inflating claims about the use of AI in financial products or services. It examines what AIW is, why firms engage in it, how it affects clients and the broader development of AI, and touches on the ethical, regulatory, and technical measures that can help address it. It also offers guidance to asset owners on how to spot both genuine AI use and inflated claims in the marketplace.

• AI Washing: The Cultural Traps That Lead to Exaggeration and How CEOs Can Stop Them | California Management Review

  Without the ability to probe deeply into how AI works—whether it is truly self-learning or merely an advanced form of automation—CEOs and boards may approve and even promote AI initiatives that don’t live up to their billing. This results in AI washing, where the technology’s purported benefits far exceed what it can realistically deliver. [...] Zuboff, S. (2019). The age of surveillance capitalism: The fight for a human future at the new frontier of power. PublicAffairs. Kim, M., & Kim, J. (2021). AI washing and the need for AI governance in businesses. Journal of Business Ethics, 169(4), 567–583. Chui, M., Manyika, J., & Miremadi, M. (2016). Where machines could replace humans—and where they can’t (yet). McKinsey Quarterly, 3, 58–69. Berman, S. J., & Korsten, P. (2018). The next era of AI in business: AI technologies will reshape company capabilities in the digital economy. IBM Institute for Business Value, 12(3), 10–18. [...] Pressure to Keep Up with Industry Trends: CEOs and board members who don’t fully understand AI are often influenced by the broader industry hype surrounding it. They see their competitors adopting AI and feel compelled to follow suit, even if they don’t fully grasp the technology themselves. This creates a top-down pressure to implement AI solutions across the organization, often without sufficient vetting. In this scenario, AI washing becomes a byproduct of leadership’s anxiety about falling behind rather than a calculated attempt to deceive.

• Instance Of

  Q8187769