Deloitte will refund Australian government for AI hallucination-filled report - Ars Technica

Deloitte Australia will partially refund a $440,000 AUD government contract after its compliance report was found containing AI-hallucinated citations generated by GPT-4o, including fake publications attributed to real academics and fabricated judicial quotes. The consulting firm quietly acknowledged using “Azure OpenAI GPT-4o” in an updated report that reduced references from 141 to 127 sources, though the government maintains recommendations remain unchanged. Sydney University’s Chris Rudge argues the report cannot be trusted due to its “flawed, originally undisclosed, and non-expert methodology,” highlighting concerns about undisclosed AI use in government consulting and the reliability of AI-generated research citations.​​​​​​​​​​​​​​​​