Deloitte will refund Australian government for AI hallucination-filled report

Deloitte Australia is set to provide a partial refund to the Australian government following the revelation that a recent report was riddled with inaccuracies, including fictitious quotes and references to non-existent research. The report, titled "Targeted Compliance Framework Assurance Review," was completed in July and subsequently released by the Department of Employment and Workplace Relations (DEWR) in August. It cost taxpayers nearly $440,000 AUD (around $290,000 USD) and was intended to evaluate the government's technical framework for automating penalties in the welfare system. Concerns arose shortly after its publication when Chris Rudge, the Deputy Director of Health Law at Sydney University, identified numerous citations that referenced publications that did not exist. Among these were several attributed to Lisa Burton Crawford, a legitimate professor at the University of Sydney law school. Crawford expressed her alarm, stating, "It is concerning to see research attributed to me in this way," and called for Deloitte to clarify how such citations were generated. In a bid to rectify the situation, Deloitte and DEWR incorporated an explanation in an updated version of the report released on a Friday. This update was described as addressing a few corrections to references and footnotes. Notably, on page 58 of the 273-page revised document, Deloitte acknowledged the use of a generative AI tool, specifically an Azure OpenAI GPT-4 based model, in the technical processes that aimed to determine whether the system’s code could be aligned with business requirements and compliance standards.