| The daily disasters, glitches, and money pits of the AI boom. |
| THURSDAY, OCTOBER 29, 2026 |
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| DAMAGE REPORT |
| How millions get wasted by AI. |
| −$9.065B | Alphabet’s free cash flow last quarter, after paying for the AI buildout |
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| $45.2B | what Microsoft spent on buildings and gear in one quarter, leases included |
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| R$20M | fine a Brazilian court gave a lawyer over a ruling nobody could find |
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| 2,231 | court cases with AI-invented law, as of yesterday |
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| TODAY'S DISASTER |
| An AI Impostor Sold Science Magazine a Story Under Caroline Williams’s Name |
| Have you ever seen your own name on work you never did? Caroline Williams has. |
| Williams writes about science from the UK. In June, Science magazine ran a story under her name… about how your heartbeat shapes the way you think. |
| But she didn’t write a word of it. |
| Here’s how the con worked. A fraud took her name and her old clips… and pitched editors by email. Science paid about a thousand dollars for the piece. And later, an AI checker flagged the first draft… and the editors found two quotes lifted from other writers. |
| No engineer told the chatbot to steal a woman’s name. It wrote what it was asked to write… and the fraud signed it. |
| So who caught it? Williams did. Editors at other magazines warned her about strange pitches, so she posted a warning on LinkedIn in capital letters. A Science editor saw her posts… and on September 16, Science pulled the story. |
| AI CAUGHT LYING |
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| Every morning I look at the same scoreboard. Damien Charlotin counts every court case where a machine made up the law… and as of yesterday, he’s at 2,231. Let me show you three, from three countries… |
| Start in Mississippi. On October 21, the state Court of Appeals ordered lawyer Michael Crosby to pay the state $5,000. His briefs cited cases that don’t exist. So the money covers about 40 hours of a state lawyer’s time. He has 30 days to pay. |
| Then Brazil. In June, a court in Paraná fined lawyer Giovanni Antônio de Luca R$20 million. He’d sued iFood, Rappi and Uber for R$1 billion… and leaned on a 2023 ruling from Brazil’s Superior Court of Justice. The judges couldn’t find it on record. So they fined him 2% of what he asked for. He can still appeal. |
| And in January, Mumbai. Justice MM Sathaye of the Bombay High Court ordered Mohammed Yasin to pay ₹50,000 to the court staff’s health fund. Yasin’s papers cited a case the clerks couldn’t trace… and he’d signed them without checking. |
| AI CASH BURN |
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| Alphabet’s free cash flow came in at minus $9.065 billion last quarter. |
| That’s what’s left after the building bills. Google’s parent brought in $42.29 billion from running the business… then spent $51.355 billion on capital projects, racing to build out AI. Three months earlier the hole was $5.855 billion. Would you lend to a business whose hole gets deeper every quarter? I’d want answers first. |
| And Alphabet says next year’s spending will “increase significantly,” and the stock fell more than 8% after hours. Microsoft reported the same night… $45.2 billion of spending in one quarter, leases included. Its free cash flow stayed above zero, at $18.63 billion. But that’s down 27% from a year ago. |
| Step back and you’ll see the pattern. Both firms are growing… and both are paying more for every dollar they keep. So the bill for the boom keeps climbing every quarter, and you’re the one holding the shares when it comes due. |
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| AI ROLLBACK TRACKER |
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| › Denver’s City Council voted 9-3 this month against keeping Sunny, the city’s AI chatbot. The vote killed a five-year, $3.9 million deal with Citibot. Council member Paul Kashmann said if workers are burning out, hire another person… so the city will train three new 311 agents. Sunny’s contract runs out this month. But the mayor’s office still wants Sunny back, and it says it will try to keep the bot. |
| › Amazon lifted a ban on an Ontario shopper’s account this month, after CTV News called. Amazon had cancelled her orders over “policy violations”… and its chatbots couldn’t tell her what she’d done. You can’t argue with a bot that won’t answer. She got her account back, plus a $200 gift card for the trouble. |
| › Apple switched off AI summaries for news apps in January 2025. The feature had sent out a fake BBC alert saying Luigi Mangione shot himself. The BBC complained. Apple’s fix came in iOS 18.3. |
| › Gannett paused its LedeAI high school sports recaps in August 2023. One Columbus Dispatch recap called a game “a close encounter of the athletic kind.” You can guess how readers took that… and LedeAI’s own boss called it a pause with no end date. |
| AI VIDEO SLOP |
| The week in machine-made video. Watch the hands. |
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| ► YOUTUBE AND FACEBOOK, NO VIEW COUNT PUBLISHED |
| A pill seller called Resilia ran more than 8,000 AI cartoon ads. The musical shorts open on ethnic stereotypes and sexual shock… then pitch you garlic and oregano pills minutes later. About 7,000 ran on YouTube. But CNN’s Scottie Andrew asked Google about them. Google said the ads broke its rules… and pulled the ones CNN flagged. CNN via KVIA › |
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SPORTSBET
AI FOOTY STARS |
| ► INSTAGRAM, OCT 14, NO VIEW COUNT PUBLISHED |
| Sportsbet posted AI videos of AFL stars saying lines from movies and speeches. One had Lachie Neale giving Snoop Dogg’s Walk of Fame speech… and thanking himself. The players’ union said nobody asked the players. So the AFL told Sportsbet, its own betting partner, to take them down, and they were gone that afternoon. The Daily Aus › |
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INSTAGRAM
AN AI COMEDIAN
WITH BORROWED JOKES |
| ► INSTAGRAM, 7M+ VIEWS |
| An AI “comedian” called Tiffany Sloan pulled more than 7 million views on one Instagram clip. Nobody knows who runs the account, and it has more than 375,000 followers. Then stand-up George Brett Olson posted his own set beside hers… same joke, same outfit. Olson didn’t need a detector to see it. Kotaku › |
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| ALSO MAKING THE ROUNDS |
| A choir in Tel Aviv singing the Hanuman Chalisa went around as a thank-you to an Indian pilot. But the banner behind the stage turned to mush… and a mark like Gemini’s logo sat in the corner. The Quint’s WebQoof team called it. |
| A newborn with a full moustache fooled TikTok this month. Boatos.org spotted the moustache sliding around between frames. And a TikTok creator who ran it through a detector called the result “heartbreaking.” |
| Fruit Love Island ran 28 AI episodes of talking fruit on a dating show. It drew more than 300 million views on TikTok and YouTube… before TikTok pulled episodes and the show ended in March. |
| And here’s one for anybody who’s worked on a campaign. A fake video aimed at Sherrod Brown in Ohio used the photo of Haya Akbik, a former Brown intern. She said the words put in her mouth were made up… and Clemson’s Darren Linvill said the clip carries the marks of Storm-1516, a Russian network. |
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| AI IMAGE SLOP |
| Pictures a computer drew, and a brand paid for. |
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| Washington State baseball posted an AI poster for its Cougar World Series on October 19. Many of the faces weren’t WSU players, the Cougar logo came out warped, and the campus was nowhere in sight. Followers called it AI slop… and the team took it down within the hour. A player had made the images. Daily Evergreen › |
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| REI ran an Instagram ad with a bike that grew a second set of handlebars out of the seat. REI says Meta signed it up for an AI tool that changed the photo. Reddit users counted too many chains and spotted the scrambled letters… so REI pulled the ad on June 22. Try buying a bike off that picture. Fast Company › |
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| Newfoundland and Labrador’s government ran a vaccine ad for seniors with a six-fingered hand. Opposition member Sarah Stoodley raised it in the House in May… and Minister Lloyd Parrott called the picture a mistake. You can count the fingers. VOCM › |
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| BEST OF THE COMMENTS |
| Three people who said it better than we could. |
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| An AI impostor sold Science a story under Caroline Williams’s name. |
| “EDITORS: THIS IS NOT ME!!!” |
| Caroline Williams on LinkedIn, warning every editor she could reach. No like count published. |
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| REI ran an AI-altered ad with a bike nobody could ride. |
| “REI using AI slop now. So much for caring about the environment” |
| u/Jeffrey_C_Wheaties in r/REI, close to 800 upvotes. |
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| Resilia’s AI cartoon ads open on a shock, then sell garlic pills. |
| “physiological arousal bait” |
| Jacob Teeny, a marketing professor at Northwestern, talking to CNN. |
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| Found a comment worth printing? Hit reply and send me the screenshot. |
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| Let me read you a death notice. GPT-4, the first one, died on October 23, 2026. OpenAI switched off the old gpt-4 snapshot that day… and sent its last users to a newer model. |
| It was born on March 14, 2023, and its maker said it showed “human-level performance” and passed a mock bar exam near the top 10%. But it never got sworn in. And people who trusted chatbots have since filled Charlotin’s list… 2,231 cases deep. |
| Newer models with the same promise survive it. Here’s what I believe: Caroline Williams did more checking this fall than any of them. Rest in peace, old fella… and keep your own eyes open. |
| Keep a hand near the switch. |
| Gus Lehman |
| EDITOR, ARTIFICIAL INCOMPETENCE |
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| SOURCES: Columbia Journalism Review, “Fake Caroline” (Oct 8) · Science editor’s note (Sep 16, via Pharyngula) · Damien Charlotin, AI Hallucination Cases database (updated Oct 28) · Darkhorse Press on the Crosby order (Oct 28) · Tribuna do Paraná on the TJPR fine (Jun 29) · Bar & Bench on the Bombay High Court costs (Jan 15) · TradingKey and The Motley Fool on Alphabet Q3 (Oct 28) · Fortune and The Motley Fool on Microsoft (Oct 28) · Denver7 on Sunny (Oct 21) · CTV News and Vibe Graveyard on the Amazon ban · Vibe Graveyard on Apple and Gannett · CNN via KVIA · The Daily Aus · Kotaku · The Quint · IBTimes UK and Boatos.org · Wikipedia on Fruit Love Island · IBTimes UK on the Brown video (Oct 28) · The Daily Evergreen · Fast Company · VOCM · OpenAI deprecations page and GPT-4 post (Mar 14, 2023) · Images: CNN (Resilia ad), The Daily Evergreen (WSU Baseball), Fast Company (REI ad), VOCM (Government of Newfoundland and Labrador) |
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| ARTIFICIAL INCOMPETENCE |
Sent every weekday morning.
Nothing here is investment advice. Do your own homework. |
