| The daily disasters, glitches, and money pits of the AI boom. |
| MONDAY, OCTOBER 26, 2026 |
| |
| DAMAGE REPORT |
| How millions get wasted by AI. |
| $260M | the hole in one sum in Deloitte’s AI-assisted report for Western Australia |
|
| $450K | what an 88-year-old lost to a deepfake of Mark Carney selling an investment |
|
| 42% | companies that scrapped most of their AI projects in S&P Global’s 2025 survey |
|
| 2,217 | court cases with AI-invented law, as of Saturday |
|
| |
|
| TODAY'S DISASTER |
| Deloitte Charged Western Australia A$166,000 for an AI-Assisted Report That Can’t Add |
| Do you check the math on your bills? I do… every single line. |
| Western Australia’s government paid Deloitte A$166,000 for a study, and the question was simple… should UWA, Curtin and Murdoch merge into one big school? |
| Here’s what came back. In one merger case, Deloitte listed day-one costs of $514 million, plus $145 million over five years. That’s $659 million. But the report says $399 million… a $260 million hole in one sum. |
| And that wasn’t the only miss. A second case turned $512 million into $823 million. The report called Curtin by an old name it dropped back in 2010… and one cited WHO link even carried a ChatGPT tag. |
| Deloitte says it used generative AI to gather research, summarize and proofread. No engineer taught the tool to get addition wrong. But the tool doesn’t add at all… it writes what a total ought to look like. |
| So who caught it? A Reddit post flagged the fake sources in early October. Then Guardian Australia’s reporters did what the machine never did… they added two numbers. Now the state wants Deloitte to hurry up with a refund. |
| AI CAUGHT LYING |
| |
| I check one list every Monday, and it gets longer every time I look at it. Damien Charlotin tracks every court case where a machine made up the law… and on Saturday he hit 2,217. Let me show you three… |
| Start in Houston. On October 21, Chief Judge Alia Moses fined Eric Lyndell Moore $7,500. He had no lawyer in his fight over the JCPenney bankruptcy… and he later pulled 13 bad citations. So the judge barred him from new filings without the court’s OK. |
| Then Singapore. In March, Justice S Mohan found two bad cases in a defense filing, and one of them was pure fiction. Nobody owned up to AI… but the judge said a tool was most likely used. He ordered lawyers Goh Peck San and Amarjit Singh Sidhu to pay $5,000 each, out of their own pockets. |
| And Quebec. This time the fake law came from the arbitrator, not a lawyer. His award leaned on four court rulings that don’t exist, and Osman Medical had lost a C$1,225,000 claim on that award. But in April, the Superior Court threw it out. |
| AI CASH BURN |
| |
| |
| Anthropic lost $80.7 billion in six months. |
| Read that number twice, because it’s no typo and it isn’t a full year… it’s six months. That’s the first half of 2026, from a draft IPO filing The Wall Street Journal saw. Most of it is a $72 billion accounting charge tied to convertible bonds. But the cash costs are climbing too… compute costs ate $9 billion, up from $2.3 billion a year before. Sales were $16.3 billion. |
| And the promises dwarf the sales. Anthropic has signed $450 billion in cloud deals, most of which can’t be canceled… and it plans to spend $750 billion on compute. Would you sign a lease you can’t break for that kind of money? I wouldn’t, and I doubt you would either if it were your own name on the line. |
| Step back and look at the lenders. Blackstone funds are taking $9 billion of junior debt in Anthropic’s $60 billion chip deal… at a 10% coupon. Firms rated the same pay about 7%. So the lenders want three extra points. And the IPO is expected in November. |
|
|
| AI ROLLBACK TRACKER |
| |
| › Bookshop.org switched off Meta’s AI ad tools this month. A Meta account update had opted the bookseller in… then Meta’s AI added its own drawing to a human-made ad, and nobody at Bookshop knew. On October 30, Meta’s new terms make advertisers carry the blame for what those tools produce. If you advertise on Facebook, mark the date, because after that the mistakes the machine makes in your ad are yours to own. |
| › DPD switched off part of its chatbot in January 2024. Customer Ashley Beauchamp got the UK parcel firm’s bot to swear… then the bot called DPD the worst delivery service in the world. It wrote a haiku too. DPD blamed a system update. |
| › Ofqual dropped its grading algorithm on August 17, 2020. Nearly 36% of England’s A-level grades had come out lower than the grades teachers gave… so students got their teachers’ grades back. Ofqual’s chief, Sally Collier, resigned on August 25. |
| › A Dutch court shut down SyRI in February 2020. The Dutch government used the system to hunt welfare fraud. Privacy groups and the FNV unions sued. And the Hague District Court ruled SyRI broke Europe’s human rights treaty. |
| AI VIDEO SLOP |
| The week in machine-made video. Watch the hands. |
| |
 |
| ► X, OCT 19, NO VIEW COUNT PUBLISHED |
| A deepfake had Sen. Richard Blumenthal calling India a failed state. The 19-second clip started life as an Economic Times video about Russian oil. You can see it for yourself if you watch his mouth while he talks… the lips don’t match the words and the jaw looks wrong. BOOM caught it. A voice checker flagged the audio too. BOOM › |
|
| |
SPAIN
A PARTY’S
AI CONFESSIONS |
| ► PARTY ACCOUNTS, NEARLY 2M VIEWS |
| Spain’s People’s Party posted an AI video of its rivals “confessing” to scandals. AI copies of Begoña Gómez and José Luis Rodríguez Zapatero admit to things both deny. Gómez is the prime minister’s wife. Would you spot the AI notice? It sat at the bottom in tiny, nearly see-through type. So Leire Díez, another target, went to court. UA.NEWS › |
|
| |
BENGALURU
A BLAST
THAT NEVER HAPPENED |
| ► INSTAGRAM, NO VIEW COUNT PUBLISHED |
| An Instagram clip showed Bengaluru’s Vidhana Soudha blowing up. The clip opens on true footage of the statehouse… then an AI blast fills the frame. Nothing blew up. The building’s fine. A police social media officer spotted the clip, and officers traced the account to Hazarat Ali, 25. They arrested him on October 21. MediaNama › |
|
| |
| |
| ALSO MAKING THE ROUNDS |
| Leslie Pickett, 55, spent 10 months talking to a “Jon Bon Jovi” who sent her AI videos. She lost more than $10,000. Mariana van Zeller’s team at National Geographic traced the scammer to a house in Lagos. |
| Scott Colom’s Senate campaign in Mississippi made an AI video of Sen. Cindy Hyde-Smith running from reporters. Then Attorney General Lynn Fitch threatened to go to court… and the campaign pulled it. |
| A “pig squad” clip showed French riot police leading pigs into a Paris protest. French police say dogs are their only four-legged officers. But one repost on X passed 373,000 views before Offbeat Concerns called it. |
| And if you bank in Canada, read this one. Ralph Moore, 88, lost $450,000 to an investment scam pitched by a deepfake of Prime Minister Mark Carney. TD Bank won’t pay it back. Think about that. CBC’s Go Public told his story. |
|
|
| AI IMAGE SLOP |
| Pictures a computer drew, and a brand paid for. |
| |
 |
|
| Patrick White Publishing listed a Hobart storefront that AI made up. The building at 118 Liverpool St holds a food company and an accounting firm… ABC reporter Ashleigh Barraclough went and looked. Software checks also found OpenAI and Google Gemini watermarks on some of the company’s book covers. Would you hand your book, and your money, to a firm whose front door was drawn by a machine? ABC News › |
|
| |
 |
|
| Benjamin Netanyahu’s Instagram posted an AI picture of an atomic bomb falling on Tel Aviv. He shared it on Sunday, two days before Israel votes, with a post calling the country’s other fights a smokescreen next to Iran. No bomb fell… a computer drew the whole scene. And Yair Golan, who leads the Democrats party, accused him of spreading panic. Ynetnews › |
|
| |
I VOTED
CELEBRATING
FVEZDOM |
|
| An “I voted” sticker for America’s 250th birthday garbled its own slogan. Who printed it? I don’t know, and the story doesn’t say. “Celebrating Freedom” came out so mangled that Reddit commenters read it as “FVEZDOM.” The voter who posted it on r/mildlyinfuriating griped that people lean on AI now. The Cool Down › |
|
| BEST OF THE COMMENTS |
| Three people who said it better than we could. |
| |
| |
| Benjamin Netanyahu’s Instagram posted an AI picture of a nuclear blast over Tel Aviv. |
| “I ask that he be kept away from social media.” |
| Yair Golan, chairman of the Democrats party, to Ynetnews. No like count published. |
|
|
| |
| |
| A publishing service borrowed Patrick White’s name and listed offices AI made up. |
| “Patrick White himself would be absolutely furious about this misuse of his name” |
| Jane Novak, literary executor of the Patrick White estate, to ABC News. No like count published. |
|
|
| |
| |
| Students said the University of Louisville’s history department used AI on a course poster. |
| “I love you U of L History Department but why are we using AI” |
| A student on the department’s Instagram post, as printed in The Louisville Cardinal. No like count published. |
|
|
| Found a comment worth printing? Hit reply and send me the screenshot. |
|
| |
| |
| Do you remember HAL 9000? In “2001: A Space Odyssey,” the ship’s computer brags that no 9000 machine has ever made a mistake. That was Hollywood’s AI in 1968… calm, polite and never wrong, the kind of machine you’d trust with the ship and the crew and the math. |
| Here’s what turned up instead. Deloitte’s report for Western Australia added $514 million and $145 million… and got $399 million. HAL at least waited for deep space before it went wrong, but Deloitte’s tool went wrong in an appendix. |
| But Stanley Kubrick got one thing right. The astronaut wins by doing the job himself. And Guardian Australia’s reporters did the same thing… they checked the sum. Here’s what I believe: a number from a machine is a draft until a person adds it up. |
| Keep a hand near the switch. |
| Gus Lehman |
| EDITOR, ARTIFICIAL INCOMPETENCE |
| |
| SOURCES: The Next Web and The Outpost on the Deloitte report and refund (Oct 25), citing Guardian Australia · Times Higher Education on the AFR findings (Oct 16) · Yahoo Finance and The Cool Down on Ralph Moore, citing CBC Go Public (Oct 21) · CIO Dive on the S&P Global survey (Mar 14, 2025) · Damien Charlotin, AI Hallucination Cases database (updated Oct 25) · Moore v. Jackson Walker LLP, S.D. Tex. order (Oct 21) · Tan Hai Peng Micheal v Tan Cheong Joo [2026] SGHC 49 · Blakes on ARIHQ c. Santé Québec, 2026 QCCS 1360 · Quartz and Fortune on Anthropic’s draft IPO filing, citing The Wall Street Journal (Oct 21) · NewsBytes on Project North Star, citing the Financial Times (Oct 17) · Adweek on Bookshop.org and Meta (Oct 22) · TechInformed on DPD (Jan 22, 2024) · Ofqual exam results algorithm (Wikipedia) · DutchNews on SyRI (Feb 5, 2020) · BOOM · UA.NEWS, citing The Guardian · MediaNama · Pulse.ng and ABC30 on the Bon Jovi scam · The Dispatch on Colom and Hyde-Smith (Oct 23) · Offbeat Concerns on the pig squad clip (Oct 25) · ABC News · Ynetnews · The Cool Down · Politixia, republishing The Louisville Cardinal (Oct 25) · Images: BOOM, Patrick White Publishing via ABC News, Benjamin Netanyahu’s Instagram via Ynetnews |
|
|
| ARTIFICIAL INCOMPETENCE |
Sent every weekday morning.
Nothing here is investment advice. Do your own homework. |
